I'm assuming that is side by side units and not one above and one below (which those tend to be described as two flats).But could it be that there is a roof leak above that bathroom? 

have a lifetime.In summary, the rent deposit is not meant for the majority of maintenance and typically none of the cap expense items.Your long term hold costs on the scenario you described will be close to $250/month to rent it out. 

The reason why I am asking for rehab cost per SF is because it is. difficult to calculate the rehab cost the way you describe in the book before a general contractor (or yourself) walks through the property.

Obviously, we do not want to create SE income without reason but isn't that more in line with the relationship you're describing?

You're probably okay - if you have a carbon copy of each check, then that's basically equivalent to having a "receipt" for that transaction - it has a date, an amount, a payee, and ideally, a memo line describing the purpose of the transaction.

I was involved in a VERY similar transaction to what he describe 'because the experts' said it would work.

Hi Tyler, I am not an expert, but what you are describing sounds more like a lease option than a owner financed deal. 

That being the case, the scenario I described above no longer makes sense and I'm turning my focus towards maximizing the current property as a rental unit, either as-is or via a renovation/re-build where we can incorporate supplemental units like in-law suites or extensions. 

With the right property (as described above) you also get 12% per annum interest.The cost of quieting title is not an allowable expense upon redemption. 

Storage units, vacation homes, short term rentals, private lending just to mention a few.The advantage of rental units provides 4 conceptsMortgage Reduction - Tenants pay mortgage which pays down the principle.Tax Deductions - Operating a business provides the ability to have write offs.Appreciation - Property increases in value over time.Positive Cash Flow - The ability to put money in your pocket with little active involvement.Mark Kohler (attorney and cpa) describes it this way.Buy a property for 100,000         10,000 down payment                90,000 mortgage                     Mortgage Reduction - PITI reduces mortgage by 2000 - 20% ROI           Tax Deductions - Average cash flow property loses 6000 at 30% tax bracket our return is 2000 20% ROI Appreciation - We will use 5% it equates to 5000 50% ROI              Cash flow of 100 each month or 1000 each year 10% ROITotal return is 100% Buy a rental each year and set yourself up for generational wealth.So be boring and be wealthy.Have a great time investing.