Thoughts on a creative investment strategy?

[Daniel Fogg]

I am looking for feedback on an investment strategy to acquire rental income streams from troubled property owners with $0 invested.

When a leveraged rental property owner runs into trouble making payments and faces a foreclosure, might it be possible to structure a deal legally whereby rights to rent that property can be signed away to an investor, who takes over management and instead of charging a management fee, captures the full rental income every month and out of that pays a fixed amount directly to the lender. In return the owner avoids foreclosure, other loss from investiture they may have made in the property, and retains their ability to realize appreciation in the property over time. I see it as a legal agreement where one investors ends up owning the income stream from the rent payments and the other owns the long term appreciation piece of the investment property. The rental income investor upside is profit from rental income at $0 down, downside is the risk of not being able to rent it and the deal falls apart - in which case the owner potentially goes back to facing foreclosure again.

Since the property is not purchased by the investor its really just an agreement on splitting up the different parts of the investment and responsibilities. If the conditions are right perhaps it's possible for an investor to acquire rental income streams by simply signing the right document with the right troubled property owners?

Thanks for reading! Have a great day