If it is a loan, and you claim it as a gift on the mortgage application, it is fraud and very slippery slope.Tread carefully. 

For example, there was a triplex that is out of my current monthly payment range; however, with the potential rental income, the mortgage payments will only be a few dollars over. 

I recently finished up a flip project less than a mile away from this property and the seller is interested in purchasing this home and they have already been preapproved for a conventional mortgage. 

For purposes of the home mortgage interest deduction and for the §121 capital gain exclusion, the IRS does treat the contract for sale as if you received title on the date you entered the contract.  

I never considered looking it up on public record:So on December 13th, 2012 the mortgage company recorded a demand for sale by public trustee (Trust Deed state I guess).

I do own the house...there's no mortgage on it.

More likely we would have had higher holding costs for holding it while it was on the market and then under contract until it closed.My portion of the profit when split with my partner = $12,406.50Lease OptionPurchase price $72,150 (includes closing costs)Rehab $40,353Holding costs $2,184AVR based on appraisal $150,000Option price $159,900 for 5-year optionFinanced $112,500 on a 20 year mortgage at 4.69% (adjusts after 5 years)Bank closing costs $1,992Option fee $6,500Total into the property -$2,320 (each of us got $1,160 after getting the loan)Monthly cash flow $195.06 (97.53 each)If the optionee exercises the option just before it expires then we will get the difference between what we still owe on the property and what we are selling the property for and we will split another $50,258 ($25,129 each).Total profit $64,283 ($32,141.50 each).In summary, we will get paid a little less than 3 times the amount than if we were to just sell it.  

Nobody is really checking these items after you close but you will sign about 3 different items stating you understand that you must occupy the property and that mortgage fraud comes with a $10,000 penalty.  

In that case, we are equal 1/3 owners of the property, but only 1 is the mortgage guarantor. 

Any body have options for a 5% down mortgage on a 575k purchase price for owner occupied home in Lake Tahoe, California?