Partnership with Tenant

[John Padget]

My 19 year old daughter wants to buy a property and try house hacking, either by long term roommates or Air BNB. She has been saving since she was a little kid has a down payment saved but, I doubt she would qualify for a mortgage with her income. My wife and I talked about buying a place and just renting it out to her but, I would like my daughter to have some skin in the game and learn a skill as well.

I have never owned a rental and would like to start learning. I have been thinking about carrying the mortgage for a property and form a partnership with her. I have been looking at partnership structures but, I haven't found anyone who has partnered with the actual tenant. 

At first, I would say we would take all profits and get her down payment back. I think typically there would be a 50-50 split after that but, with her being one of the tenants, what would be the best way to do the split? Would she just pay rent like a normal tenant but, just take that out of her rent? 

Has anyone structured a deal this way or have any advice on if this is a good idea or not?

Thanks

[Shiela R.]

@John Padget yes, I have structured deals in various ways that look more like partnerships.  And I view my tenants as partners.  Obv, you would want to approach this deal with your daughter in the same way.

In a lease option, you hold the option payment (essentially, her down payment) and credit it to the purchase price when she eventually exercises her option.  You should also keep payment records (my company bank statements have always worked).  Lenders will appreciate this because that will prove proof of consistent, on time payments.  My option payments are always non-refundable but always creditable (is that a word?) toward the end purchase price.  This is where the skin in the game comes in.  Not only do you have her down payment, you have her in an ownership mindset and she will take care of the property (I'm not saying she wouldn't, but it's a great incentive).  I also do rent credits where I credit a couple hundred dollars of the monthly payment toward additional down payment funds.  Feel free to DM me.  I've found LO to be simpler than wraps.