OK folks I've got a challenge for all you creative thinkers out there.
I have a nephew that is graduating college this spring. He has been listening to me and watching what I do with my rental properties. He has asked me to assist him with the purchase of a MFH this summer so he and his wife can get started. He did not specify what kind of help he needed but I'm sure he has no money.
So I was looking through some REO listings and found a 4 plex listed for 124,900. I probably could get it for $110,000. Zillow puts current value at $181,000 and the local CAD says $147,870. I don't yet know the neighborhood or the rent rates of the area. Assuming $600/month rents it would be close to break even with 3 units rented.
I am assuming I would need to come up with the down($25,000) and sign my name to the papers. I am sure they will live in one unit and want to collect the rent on the 3 others. Do you have any creative ways that would allow this to be a win/win for both of us? I don't really like the idea of all the risk and no reward for me.
I could carry the $25000 for 4 years at 8% and their payment would be $610/month. Would it also be appropriate for me to want a percentage of the profits at sale? Maybe 20%?
Any creative thinkers out there?
I have a nephew that is graduating college this spring. He has been listening to me and watching what I do with my rental properties. He has asked me to assist him with the purchase of a MFH this summer so he and his wife can get started. He did not specify what kind of help he needed but I'm sure he has no money.
So I was looking through some REO listings and found a 4 plex listed for 124,900. I probably could get it for $110,000. Zillow puts current value at $181,000 and the local CAD says $147,870. I don't yet know the neighborhood or the rent rates of the area. Assuming $600/month rents it would be close to break even with 3 units rented.
I am assuming I would need to come up with the down($25,000) and sign my name to the papers. I am sure they will live in one unit and want to collect the rent on the 3 others. Do you have any creative ways that would allow this to be a win/win for both of us? I don't really like the idea of all the risk and no reward for me.
I could carry the $25000 for 4 years at 8% and their payment would be $610/month. Would it also be appropriate for me to want a percentage of the profits at sale? Maybe 20%?
Any creative thinkers out there?
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