If not, you don't exercise the option.Working off of your numbers above, there may be about $40K in equity in the house after all commissions/fees/taxes, making it break even (and saving 6-12 months of $1500 rent payments somewhere else).

The best $250 I ever spent was for an older real estate attorney who provided me knowledge about a problem and a beautiful solution that made me about $500,000 in equity over 20 years ago. 

For example, if the ARV is $400K but the homeowner has $140K in equity and is comfortable living there as it is, would it be a good deal for the investor?

You would not realize any gain in equity by principal pay down until you liquidate the property.

Or, you can spend money on a lawyer, get proper documents, get a domain, order some business cards, worry about asset protection, file an out of state LLC, get a phone and fax number, get an email address, take that next seminar, read that book, post more questions on here....Meanwhile, I ripped another $100K in equity on a wholesale property I bought and decided to keep, using a 1 page Word doc.

The latter is a frequently stated maxim which is also expressed in the principle that he who has done inequity shall not have equity.

So that means investing in equity, which does mean taking on some additional risk since it will have debt and could possibly default. 

A court can sit in equity as well as law.

Hello BP,I am buying a property for 20,000 and wondered what the pro's opinions are.Should I pay 20% down and get a 30 yr loan at 4% and obviously pay all the fees involved with this orI have another property worth 70,000 and have 50,000 in equity.

It's a 30 year loan at 3.25%.We now have about $175K in equity.