The idea is to place debt (in the form of a mortgage note) on the property you bought, renovated, and rented out to recoup some (or all) of the funds you spent on the purchase and rehab. 

But basically, most of them have the form of one partner putting up most or all of the funding, the other doing most of the work, and then profits split 50/50 upon an exit. 

Payments that you make normally fall into one of 3 buckets100% of the payment can be factored in somewhere on the returnPartial payment can be factored somewhere on the return0% of the payment can be factored in somewhere on the returnHouse-hacking also has considerable tax implications in the event that you want to sell this property.You can potentially defer a portion or all of the gain on the investment property with 1031 exclusion.You can potentially exclude a portion or all of the gain on the personal residence with section 121 exclusionThe answer to your $10,000 question is it depends on if the unit is in service and what the breakdown of the $10,000 is(repair vs improvement) and if there is any safe harbor/election to currently expense the items.

With that in-law, you can either live in that or the main house, and subsidize the rest (or ALL) of your mortgage.

An advantage of that is the if there are varied joist widths and depths it can fully fill the cavity.

Which means that if your W-2 income is higher than $100,000, then some or all of the rental loss will be suspended and carried forward to subsequent years.

some loans you could get earlier this year are no longer offered by most or all lenders.Best of luck!

or all 3 to make a deal work.

I believe you have a typo there.This property is bank-owned are they allowing financing or all cash?

The tenant was on a month-to-month lease (only orally recorded), of which arose from a written long-term lease from several years ago.