@Sue Kelly @George Despotopoulos Thank your for your responses! Super helpful!
Person A has fine credit, income is too low to qualify for a rental property in this area, would not be able to front any money if rental is vacant for one or more months, and 30K was a gift and not savings.
Person B & C are married and looking to invest in a rental property. The 40K are in a sense from both B&C, but primarily B. B switched jobs recently to commission and banks are telling us he won't qualify for anything for at least 2 yrs.
Person C can contribute to downpayment if needed. Person C qualifies for the mortgage and would be able to float the mortgage if reserve funds dry up and the rental is vacant.
B & C can certainly save up for an additional year and come up with 100% of downpayment. Person A is a family member who is looking to increase cash flow too, which is why we invited him to consider purchasing this property with us.
The plan is that once the mortgage is secured to move the deed to the LLC which would include A, B, and C so all parties would own the property. I guess what I'm wondering is what others value the risk of mortgage vs downpayment cash. So for every cash dollar put towards a down payment what would that "fairly" equal in mortgage dollars? Everyone wants to do this investment, but we are having a hard time figuring out how to fairly split. A thinks he should get more than 33% bc he is putting in 42% of downpayment. So what is the risk of a $210K mortgage equal to in this equation? One way I was looking at it was if all three parties contributed $20K towards the downpayment what percentage extra should C get for the financial risk of the added $200K in mortgage?
