ADVICE WANTED FOR UNIQUE SITUATION

[Eric Gesswein]

I have a friend that is not a member of BP, so he wanted me to post this. Ron owns a 2800 Sq ft house in Las Vegas that was built in 2004 and was purchased a year ago for $230,000 . 5 3/4 % 30 yr fixed. Its value is now close to 215,000. He stated his downpayment was $5,000 and now has a mortgage of $1,800 a month. A friend of his lost his house recently and is paying $2,200 a month for a rental house. Rons idea is to offer his friend to live in his current house for $1,900 a month AND offer him 50% equity in the sale of the house 5 to 7 years down the road when the housing market gets better. In the meantime,Ron is going to purchase another property to live in while he rents out his current residence to his friend. Ron also owns a rental property in Kansas City with a $600 a month mortgage with a renter that pays $1,200 a month for rent.( I believe he put down a large down payment on this property, but thats an entirely different story!) Ron is curious if this is a good idea/bad idea or crazy idea and just wanted some other peoples opinions about his idea of the 50% equity stake to help out his friend. Any advice on this situation would be greatly appreciated.

Eric