How to buy a house from family with an investor state of mind?

[Ricky R.]

So I'm just starting out with investing and home ownership and have an opportunity to buy my grandparents home in Durham NC. I was originally offered to rent the place (which is paid off) but now offered to purchase the home. My grandfather passed recently and grandmother has dementia so I'm fairly certain my uncle has power of attorney. Him and my mom will be splitting proceeds from the sale. I'm moving there in late April and he's mentioned me renting until he figures out how and what to sell it for. I've showed him tax value and recent comps just to be fair and help him decide, as it is family. I'm also trying to steer him in the right direction on this process because he was thinking he would need a realtor and all this other stuff. I don't qualify for a conventional loan for approximately another year but can get financed through my credit union with 10% down. I'm leaning more towards seller financing or other financing options that doesn't require money down and that will still be beneficial to all of us. I don't really know what my family would agree to at this point so I made an appt with a real estate atty who knows estate law so all three of us can sit down and be told and discuss our options/tax advantages/loopholes etc. One part of me is thinking like an investor but then again I want what's best and fair for my family also. I've researched a little and read about equity gifts, quit claim deeds w/ refinance later, etc. So my question is, does anyone know about or has dealt with this in the past that could give me any advice? A perfect world would be to get in the house with no down payment, at a great price so I start with equity, and still satisfy my mom and uncle. To make an informed and tactical decision from an investor, tax, cost effective and respectable standpoint; for both me and my family. I'm planning to live there long enough to straighten things out but ultimately looking to house hack a multifamily property as soon as I can with my current financial situation. Just a lot going on and Im thinking a real estate atty could provide options but I've never done this before so Im kind of playing it by ear. Do I also need to see a tax professional to find out the different tax implications of all options from them selling and me buying? Also not sure if I should do this under an LLC or my own name. Lol I have so many questions. Not sure if there's an inexpensive way that's beneficial to us all that even exists! Thanks BP.

[Mark Hove]

@Ricky Rigsbee excited you have this opportunity! If you want to be fair to your family and your family wants to continue to get income from the property like they would if someone were to rent, I would really suggest you go the seller finance route. Hire 2 appraisers, average their 2 appraised values. Subtract 6% (realtor fees they saved by not putting on market) and do 10% down seller finance at a slightly above market interest rate on a 15 or 20 year note, my guess is your family doesn’t want a 30 year note. In this scenario, you take the deed, you can fix it up, you can choose to sell or rent if you want. Gives you most control. Super fair approach from what I know of your situation. Good luck!