There are also additional costs of operating and maintaining an LLC, like separate bank accounts, annual report filings, tax filings, etc.2.

Should I talk to an appraiser before the bank gets an appraisal?

The property is zoned as a SFR house and likely in a neighborhood of the same.Was the property not appraised by the bank when you got your mortgage?

.: Quote from @Jay Hinrichs: Quote from @Matthew Banks: Very interesting post John.

Hard to do right now, if you are using bank money.

At it's basic level:Assumption: Asking the bank to turn the loan over to you and going through the normal underwriting process, credit, income, DTI ratio etc SubTo: Taking over the loan without telling the bank, no underwriting, no credit check, no income verificationBoth have risks, but it's not my intent to be detailed in this post.

The idea is to convert a multi-family building into condos; but not in the traditional sense where you separate pre-existing apartments into their own condos; but in a way where you combine the common areas of all of the apartments in that whole building, and turn the individual rooms within those apartments into condos themselves; thus transforming the hallways, kitchens, bathrooms, living rooms, dining rooms, porches, balconies into common areas of the condos. 

I am trying to calculate my returns over a 10-year period using the rent-by-room strategy, which results in significantly more cash flow than traditional rentals.

Bank pushed us to 40% down payment so also executed a $85K seller carry-back loan to cross the finish line.

That $250k sitting in the bank with no chance of vacancy or capex could earn you $11,250/yr at 4.5%.