Portfolio of six homes, worth the investment?

[James Whitehead]

This is potentially going to be my first deal so I apologies in advance if my info and idea isn't as succinct as it could be.

My wife's family is in Louisiana and looking to sell 6 rental homes as they are moving out of town and do not want to keep them as they were self managing. They want to sell all of them at once, and not piece meal them out individually, so they are asking for less than market value.

The offer is 6 homes 5 of which currently have renters, for $400,000.
I have been able to talk to a mortgage broker and have been approved for a loan as long as the appraisals accurately reflect the valuation. The lender also ran the numbers to see if I would qualify and the numbers below reflect info given by me to him and his calculations. I am unsure if they are a good investment, but I am leaning towards yes, I don't have anyone around me to ask so I decided to come here.

House 1. rents for $825/m the loan will cost me $13,000 as a down payment and $6,000 closing costs, and should cash flow approx $275/m after mortgage payment are made.

House 2. rents for $600/m the loan will cost me $13,000 as a down payment and $6,000 closing costs, and should cash flow approx $50/m after
mortgage payment are made.  The man currently living there is a retired wheelchair bound vet who always pays on time and so they have never felt right raising the rent as hes only living on his Army paycheck.

House 3. rents for $800/m the loan will cost me $14,000 as a down payment and $6,000 closing costs, and should cash flow approx $225/m after
mortgage payment are made.

House 4.  can rent for $825/m the loan will cost me $13,000 as a down payment and $6,000 closing costs, and should cash flow approx $275~/m after mortgage payment are made. This house currently has no renter though they are actively looking to put one in the home.

House 5. rents for $725/m the loan will cost me $13,000 as a down payment and $6,000 closing costs, and should cash flow approx $275/m after
mortgage payment are made.

House 6. rents for $725/m the loan will cost me $14,000 as a down payment and $6,000 closing costs, and should cash flow approx $250/m after
mortgage payment are made.

To be able to make this down payment I have the option to:

HELOC my current home which cost me about $850/m in repayments

OR

I can find a hard money lender who would be interested in working with me, I am currently putting together a hard money lender proposal to show a couple family members that would basically look like this: No repayment in the first 12 months, all income going into an account to allow for repairs and emergencies, after that taking the cash flow and splitting it 75/25 to the lender paying it off in approximately 13 years, sooner if we can make extra payments on it and giving the lender an 8% return on his money(about .5% less than what I was quoted for my HELOC).

OR

I can potentially do a deal with my brother who is also looking to get into real estate and we split the properties 3 a piece.

These properties are right outside of a military base in a low income city but have done well for the family currently owning them with consistent long term renters in them.

I am looking for any advice as to whether or not this is a deal worth pursuing. For anyone who took the time to read this and can share any advice, warnings or encouragement, thank you.

J Whitehead

[Theresa Harris]

Does that include insurance, property taxes, vacancy and repairs? Do tenants pay utilities? What major expenses can you expect in the next 5 years (eg roof, HVAC) for each property?  How long have the tenants been in the 5 homes that are rented and do they take care of the property?