All Forum Posts by: Bryan Faust

The non-occupant option defeats any benefit to the FHA mortgage in the first place. What I'm trying to do is let my partner purchase the property on his own, and then jump in as an equity partner after he's secured the loan. I'm not sure if there's a way to do that contractually between the two of us without being on the actual title or mortgage.

I know in the corporate world such a thing exists where you can buy "ghost shares" of a privately held company; in that you are entitled to your percentage of the profits and losses of a company from an operational standpoint, but technically don't own it.  This is all I'm truly after.  

From what I understand, due on sale is virtually never an actual issue.  Though that's certainly not a given.  But many people on here discuss the topic and very few, if any, actually experience the problem.

I don't want to be a property manger, I want to be an equity partner.  If we had vast sums of cash to pool, we wouldn't need each other's help.  I guess I didn't literally mean "these are your two units and these are mine" it's just a simple way of looking at it for running the math to see what it should be worth to me.  Essentially it would be like each buying a duplex.  We wouldn't keep the maintenance costs separate physically that would just be silly.  

All I'm asking here, and nobody seems to be able to give me an answer, is whether or not there's a way to become an equity partner with someone who buys a 4-family with an FHA and house hacks it. I know most people do that alone, but if he wants to house hack for a year and then buy his own actual long term house, I'd be essentially providing him with the down payment for his future house in order to buy into the 4-family.

Additionally, he could get the mortgage, and then I could "buy in" through a personal contract somehow after the fact couldn't I?

It's not that he doesn't have the money, he wants to partner with me for my experience as a landlord and abilities with maintenance. I'm not clear on what legally happens to be granted an equity share in a property. That was my question and reason for suggesting he and I form a 50/50 LLC somehow.

Is there a way to do what I'm suggesting somehow that I'm not asking correctly then? Essentially I'm looking to become a 50% equity partner with someone who would house hack a 4-family with an FHA loan.

I don't need to be on the mortgage to do that do I ?

I wouldn't put the mortgage in the LLC, I would use the LLC as the basis of our agreement, then I'd have a way to claim ownership of half the property. Essentially all I'm trying to do is create an equity share agreement by providing the down payment money. It doesn't strike me as that crazy when everyone on here talks about being creative about things. Maybe it is.

Forgive me if this has been discussed, I couldn't find anything on it.  I have a great tenant who wants to buy a house next year.  He's never done any rental work or investing, but he's very interested.  I'm wondering if this is possible:

1. Create an LLC for the two of us
2. Contract to provide him a down payment for a 4-family in exchange for 50% ownership, and agree to be responsible for half the mortgage amount (to the LLC & eachother, not the bank)
3. He acquires an FHA loan on the property himself, and moves in. He gets to rent out one other unit
4. I rent out 2 units
5. After a year or two, he can move out and rent both of his units