Hi Kin,Transferring your share of the property to your brother may have tax implications, including gift tax if the transfer is considered a gift.

You could look into forming a C Corp as an alternative way to own this property that could affect your tax returns differently, I am not a CPA or giving tax advise.

Specifically:Will the lender only consider the rental income from the two legally zoned units, even though all three rental incomes are declared on your tax return?

Line Item Fee Collected Rents 10% of All Collected Rents New Tenant Search & Onboarding $500 Business Hour Service Calls $80/hour + Materials Cost + Tax After Hour Service Calls $110/hour + Materials Cost + Tax HVAC Cleaning & InspectionGutter CleaningSpring/Fall Exterior CleanupSeasonal Mowing & Weed TrimmingSeasonal Snow PlowingGeneral Contractor Vendor Cost + 10% Oversight Fee

Quote from @Devin James: Im currently learning this lesson with New Builds that have taken twice as long to complete than anticipated.....Finishing a Real Estate project ASAP is critical because...1) Holding Costs add up quickly- Loan Interest- Property Taxes- Insurance2) Investor Capital- Our financial projections are dependent on how fast we can turn our investors capital.

They are so tax beneficial! 

Absolutely.If a landlord is listed as additional insured (rather than additional interest) they cannot make a claim against one another's liability policy for damages - it could completely jeopardize the coverage they think they're making it easier to get. 

Zero capital gain tax, next to zero income tax, property Tax is super small.  

What is the claim - that someone is going to sue them, or kidnap their child, or what? 

Bear in mind that the fiscal treatment of the two options in Mexico is different (withholding tax on the gross income with the fideicomiso vs cost deductions with the corporation).