Advice Needed House hack in my parents muliti family home?

[Louis Zameryka]

Here’s a situation that one of my relatives is in.

If anyone has advice or experience I’d appreciate it.

I have a family member that is in a bad spot. They have personal loans, heloc, and mortgage they cannot pay based on a newly reduced household income.

Their parents want to help but also have shakey finances.

However his parents have a 2 family investment home, that is free and clear of debt (in addition to the parents primary) but the parents need income from that home for their retirement (now) and also both the parents primary and the investment property need rehab soon.

I'm trying to think of a way where maybe my family member can sell their own primary, use the equity to pay off some of the highest interest of debts, then pay their parents some equity that allows the parents to renovate their own primary, then my family member move into the multi family as a tenant, but also pays a bit more than normal rent, so the parents get the cash flow they need, and maybe the "rent" is at least a portion of it rent to own, (in a way that limits taxes for the parents?) maybe via an LLC the house is put into where my family member gains shares of ownership annually over time?

Am I dreaming that there is a playbook for this?

[Jaron Walling]

@Louis Zameryka Hmmm yes you're dreaming. In a perfect world something you described could be pulled off but in reality it's not going to happen. The parents control all the cards. They have all the equity and PAID FOR properties. For them to sell and "gift" this equity is a big ask. From what you described they're already in or close to retirement. Older people don't like risk. Selling an asset that's paid for or has a low fixed rate (can't get those right now) is crazy. 

Nobody likes talking about the hard work in the background; just the success stories. The family member needs a plan. They need a job and stable income. What are they giving up to get out of debt?? What sacrifices can they make to implement the plan you laid out. It's not impossible but the parents need some security along the way.