I would collect the data for all these factors you described above, narrow down the list to a few then speak to a few real estate agents and property managers in the area. 

If this is Non-Owner occupied, then what you are describing is Hard Money.

That said, when underwriting the LOC itself, my experience matches what @Daniel B. describes, which is the underwriter only approving the LOC if DTI can support a 100% draw of the potential line.  

The terms that you describe sound likely to be a non-recourse loan but you should clarify with your lender. 

He could just be paid out his percentage of profits as a part owner for doing his duties as described in their partnership agreement.

@Humberto Perez what you describe doesn’t quite square up.  

@Trago WAllaceIt’s exactly as you described.

We use short term money to BUY (because it closes faster and has less out of pocket) and then use a 30 year, fixed rate to REFINANCE because we built in the necessary 20% of equity.I hope that makes sense how I am describing this but that's essentially how it works. 

Hey Blake,We own some student rentals in Athens, OH which sounds like a similar student housing situation that you're describing. 

Separates out ownership and operations.However, we ended up going the nominee route described by Sunny.