Factor in the down payment, closing costs, and potential renovations.Cash Flow Analysis: Ensure the rental income from both units will cover your mortgage, taxes, insurance, and maintenance costs, leaving room for profit.

Property taxes and insurance are typically the two biggest recurring costs.

Plus I pay his insurance .. its taken 3 years so 300k a year and I do all the admin etc..

This cost is typically 0.5% to 1% of the loan amount.Title search and title insurance: The lender carries out checks to ensure no issues with the property’s title, like a tax lien.

If your purchase price (always the largest expense) plus the rehab estimate (the second largest) total no more than 70% of the ARV, the remaining 30% must cover your HML charges, agent commission, property and hazard insurance, property taxes, title insurance, escrow, staging, all else, and your profit.

I am in talks with an insurance lawyer now, but how can I ensure to have max payout?

@Robert Morris it can work - until it doesn't via a lawsuit.Challenges:1) They are NOT professionals2) They are not licensed, so may cause you legal headaches3) They won't have insurance, so what happens when their actions lead to a lawsuit?

some of the charges are driving with a suspended license criminal littering/ pollution on private property no mandatory insurance unsafe lane changecriminal trespassing...showed bonded out and later dismissed disorderly conduct...later dismissed driving with no head lanps

@Alexander F PollockYou may lose a tax benefit of a stepped up basis for capital gains purposes transerring interest away from her parents.Also consider conducting a judgment searches on all parties to the transaction to confirm there will be no title problems for would come up when the LLC sells in the future because you will not have title insurance to cover prior owner issues.

some people are saying save your $800 and buy umbrella insurance.