Typical length is 6-12 months.

ALWAYS verify the comps with someone that can make sure they are arms length (normal sale) transactions and confirm condition.

And Scott Sewell - Typical terms would be fees between 2-7% (usually added to the loan) interest between 10%-15%, and term length usually 6 months to 2 years.

It's always great going in and people jump in quick and gloss over things.They pay the price later when they are looking for an out.It is hard to find a good property manager.Frankly I have studied the business at length and have friends that manage hundreds of units.I just do not see money in it for the headache.I do much better transacting commercial deals and having a life.

IMO, having seperate LLCs for every property deal is just plain crazy, totally unnecessary and has absolutely no real value in limiting any liability whatsoever that can not be accomplished with insurance.You'll also have the issue of keeping at arms length between these LLCs as a single member or very limited member LLC.

The lender is going to scrutinize this pretty closely because its not an arm's length transaction.Also keep in mind that selling the house creates a taxable event for your folks.

My only source of income is from a few rental properties but my length of time in this industry is less than 3 years.

If it's clay it is likely broken in places or if it's galvanized it is corroded from the inside and leaking outside underground.To replace just this one pipe depends on the length of run from the street to the building(s) and if certain sections are under one of your roads or your parking lot.This can cost tens of thousands to a hundred thousand in some cases to fix just to replace the pipe to the building.So that one item only can add up to another 2,500 per door in rehab costs to a 40 unit.Another one is EPA cleanup.You would need to look at what properties are around it for possible contamination and get a Phase 1 report completed.I haven't even gotten into if the building does not have a sprinkler system and the city or county wants one installed to bring up to code.5.You need to look at down trending of rents.With the foreclosures you want to rehab fast and pick from the most qualified tenants to release up.So just on basic info you have posted and not knowing anything else.40 units at 325 rent is 13,000 a month X 12 = 156,000 yearly gross156,000 minus expenses7% property management10% vacancy (your numbers are based off low rent so vacancy upon rehab should be less than going for full market rents)38% operating and expenses55% expense= 85,800 156,000 - 85,800 = 70,200 NOI once stabilized (1 year turn around expected for full rehab and rent up depending on what is needed)Value at a 10 cap is 720,000 before resale costs.Cost per unit for rehab 10k = 400kPurchase price = 150k550k - 720k new value = 170,000 forced equity.You have to remember the level of rehab needed per unit and the expected rents will play a large factor.This is just an estimate.I would find someone knowledgable to partner with if you plan to proceed otherwise you will have angry partners who lose money and multiple lawsuits will ensue when it goes bad.I by no means put an exhaustive analysis here just the basics.

Typically, a recent arms length sale of properties that were advertised for sale publicly is deemed to be persuasive evidence of the property's actual market value.

It sounds like there is enough of an arms length from you, who is not related by blood, to a mother of an in-law.