Up to bat. RE coming my way, but which way to swing

[Joseph Bagley]

Hey BP,

Been reading, listening and now I have an opportunity to buy some RE.  The property is less than $2k from being owned out right.  My mother wants her sons (me and my brothers) to take it, but not without taking care of her first.  Mom has another house bought that she lives in.  I'm the son that's be rambling about building a RE Empire. But now that it's my time to swing at RE.... how do I do this best?

I need to give my mom about $70k so she enjoy her golden years without worrying of bills after retirement.  My brother currently lives there and pays my mom on the current remaining mortgage but can't get a loan on the property.  I have enough money to pay of the $2k now.  My mom wants to avoid paying taxes her tax attorney says if I buy more than $90k she'll have to pay taxes and she wants to avoid that.  Aaand there's a $13k bill left to pay from getting new windows installed.  We believe property value to be about $120k-$140k.

Should I pay the $2k then have her sign the house over to us (me and my 2 brothers) then cash-out refi?  Get the $83k needed to take care of the debts.

OR buy it with my brothers for $83k then give her what she needs?

Looking into the future I would like to either get a roommate in their with my brother.  Or use the equity to start other deals down the line.

[Damaso Bautista]

@Joseph Bagley

Just from the small glimpse of your situation, to me having your other two brothers owning the property with you when you are the only one who is really bought into building a real estate empire is very difficult.  If I was you I would run the numbers for you to buy and pay everyone off and see how much meat is left on the bone for you.  After doing this exercise you may find out that there is no way to make money in this deal.  Family situations are hard especially when there are multiple owners all having a different idea of what the plan is.  

Now if you run the numbers and pay everyone off and you have plenty of meat on the bone left for you to make money, then it might be worth it.  

Still you would have to convince your brothers to sell to you.  If your brothers are set on living there and holding on to their piece of the pie, I would stand by and wait for your inheritance portions later on down the road. 

Good luck!