Lending from parents and Levaerage questions

[Robert Obniski]

Here's the deal. A small home became available in my home town that I would like to purchase and rent out.

My parents are willing to loan me the money to purchase this in cash.

Target purchase price is $85k 
Rehab is $30k
Lets say All-In: $120k 
ARV: $160k

My questions...

-If we own the property out right, have 120k into it and it's value is 160k- whats the likely amount we can pull out for the loan?

-If we want everything to be in my name, what would it be best way to structure this? Have them loan me the cash, i handle the project, i go the bank and take a out a loan in my name, then pay them back?

-What kind of records should be kept for tax season? Can they borrow me the cash and then i just pay back and thats it? No one will come after me or my parents for anything official?

[Derek Dombeck]

Robert,

Regardless of who or what entity will the title to the property, your lenders (parents) should have a note and recorded mortgage to protect their loan position. You should also provide a lenders title insurance policy and have them listed as the lender on your Hazzard Insurance policy. These are all standard practice with all lenders and your parents should have the same protection. 

Happy Investing 

Derek Dombeck