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Updated over 17 years ago,
How to structure this deal......
Ok so I have a deal in the works that could really work out for me. I'm trying to be fair about this....
My neighbor, who is 96 years old (and looks and acts like a 65 year old) is really poor. I mean she's been living off social security now for MANY years. Her husbands long gone, no pension, etc.....
She lives right next door to me (my house appraised at $165k, most two units are 190k or so) but owns a semi 2 unit (top and bottom). The utilities are not split. The home is on the townships books as a two unit, just that the utilities are not split. It is rather run down. The house exterior wise needs 20k of repairs (roof, siding, windows...already have 2 quotes for 17k, just using 20k high side)....inside, kinda the same....both kitchens and baths are in poor shape, and same with pretty much the rest of the house. Really just carpet/paint, and then the bath and kitchens (so around 20k also).
Now here's where I need some help. Do I buy the house outright (thinking around 60k or so) and the give her life rights and rent it back to her? Or do I pay even less, and give her life rights? I don't want to make her leave, she's been there 55+ years, and she really doesn't want to leave. Whats the fairest way to go about this?
Both units would be able to be rented for $700 easy. They are 3 bedroom (large), 1 bath, with offstreet parking and a nice fenced in yard with a stream in the back....traffic is high, but there is a scheduled road change which would make this street quiet as can be....
Also whats the best way to fund this? I don't have a ton of cash to use for the rehab....Mortgage the property, hard money for the rehab, then refi and cashflow it??