Newbie Needs Some Advice

[Michael Penny]

Here is my situation.  I have a friend whose uncle would like to sell his house and has offered to sell it to him for 80K, even though it is worth around 100-105K (that is the value that I have given it looking at comps).  Unfortunately, my friend does not have credit to buy it.  However, his uncle is willing to let someone else buy it for 80K, if they will let his nephew buy it from them once he can get a loan.

So it looks like there is an opportunity to enter into a lease option arrangement with my friend, but I am not exactly sure how to go about this.  I have a line of credit on my personal residence and that is the only way that I will be able to use any of my own money for financing or going the hard money/private money route.  I have also considered seeing if the uncle will seller finance and then do a lease option with my friend.

Any advice would be greatly appreciated!

Some other pertinent details:

• Property is free and clear
• My friend is currently paying $850/mo and can pay $950.
• My friend is willing to bring in someone else as a roommate and I should be able to charge 1150-1250/mo between the two of them.
• My friend has $3000 dollars for a downpayment/option
• The property is apparently in really good shape (newer HVAC, newer roof, etc.), I am going to try and go there tomorrow to lay eyes on it for myself
• I don't believe that the uncle needs all 80K in one lump sum.
• I have considered the BRRR method as one of my strategies

Thanks BP family,

Mike Penny