My father has a house (3 br, 1 bath, 2 c. gar) that I am looking to lease option from him. I am about to run the full numbers on it but I feel that I could possibly pull $300/mo. income on this property when it’s rented.
I have so so credit (550) and nothing in savings, this would also be my first “deal”.
From what I have listed how does this look? Workable? Thoughts?
I figure I could LO the property with the option in 3-5 years and use the rental income track record to show to the bank to finance the property at that point.
If I decide to move forward with it, I could use a bit of direction on what to do as far as paperwork and forms.
Thanks in advance.
Anytime you can pick up $300 positive cash flow, the deal looks good!! Keep the LO under 3 years to keep the lender off your back. Rent it on a triple net basis so you get credit for 100% of the rental income rather than only 75%. My only concern is doing business with family; in my experience it’s a recipe for disaster.
I agree with David. It can be a “recipe for disaster”. Put everything in writting! People can forget and/or remember things that may or may not have been said. I do deals with my family as if they were someone off the street. There’s a lot of love here and I want to keep it that way. That being said, I have seen alot of families that just like to fight. Fortunatley, that’s not my case.
Also, when I deal with my family (or anyone else) it’s always win-win. Share the love.