I know that arranging for a cash out refi in advance is en vogue, but there are some concerns that it may not appear you intended to reinvest all of your equity.

Local landlord tenant laws say that I have to mail the deposit via first class mail to the last known place of residence unless tenants make other arrangements in writing. 

Hi - I'm now considering, instead of selling my flip, to lease purchase to my parents who cannot obtain a conventional loan and love the property we rehabbed. I understand the premise of Lease Purchase, but want to kn...

Rob, have as much stuff in writing as possible on your arrangement.  

If so, we could arrange to do all this while you are gone AND have the tub replaced as well.

I'm super happy with this arrangement as it all pretty passive from my perspective. 

Technically you could make arrangements to buy the property now at a much lower price so the family can use the money immediately with the life tenant remaining until their death when it would revert to you, but that gets pretty sticky. 

Find a property with a better cap or arrange for the current seller to have the rentals increased and lock the renters into a lease.  

@Tony SanFilippo, FYI, in most of the Denver Metro Area, this arrangement would violate zoning ordinances by exceeding occupancy limits.  

I am consuming all of the information I can learn at the moment, and my wife and I are starting to arrange our personal finances to get started.