I saw that by adding a 4th bedroom the comps in the area took a considerable jump.

I would JV with her, do the work, secure the debt of rehab w a mechanic's lien, have an option to buy x% of equity for $10 plus services rendered as consideration, record the option, sell the house, make a profit, win win.

Even so, it doesn't relieve the borrower from meeting the obligation or the ability to pay in combination with the factors mentioned above.The term of the transaction can be a factor as well, a seller financed note that is of a short duration, less than a year for example, should be under less risk considerations if there is no other risk activity, like construction.

Long story short, there was a $1M verdict against the defendants, all of which was covered by insurance.I would say the LLC worked because there was zero consideration given to suing the passive owners of the property who had nothing to do with the management or operation of the property.

@Chris Piperhey thanks much I will make sure to take all those numbers in to consideration and i like the 85% of MAO it gives a little wiggle room.

Give this serious consideration before making your decision.

I'll double check anyway, but if your info is consistently accurate, you'll quickly rise up in the ranks as my first choice for inventory.

Where you rent out a property and while you are holding negative cash flow the value of the property is rising significantly faster than your losses.

The 50% assumption is more of an instant consideration for a buyer or lender considering a new or additional unit.The size of your portfolio or units under management.Maintenance is a variable expense.

In some states, those take considerable time.In some sense, you are now the owner subject to the first.