@Craig Sweeney  That's a very open-ended question depending on your circumstances, other assets, relationship with your sister-in-law, budget, type of property, type of tenants, risk tolerance, etc. 

We are finalizing our team with PMs, brokers, GCs and asset managers and still need an attorney.

You may also want to contact an attorney about the LLC because, as far as I know, a single member LLC offers little asset protection when push comes to shove.

@Adrian Jones  We can approve client on basis of credit, assets and income but not appraisal.

Happens in every market, in every asset. 

@Chris Martin  excellent post.. the reality this is as I stated NO warrenties and ALL risk on the buyer type of way to acquire assets. 

My favorite asset so far is the Small Multi-Family, I encourage you to look hard at those, but first and foremost I encourage you to find your "Why".

There are asset depletion loans where you can qualify based on liquid assets, and bank statement loans if he has a lot of money coming in but writes off a lot of expenses on his taxes. 

Maybe compromise by keeping a larger emergency fund than normal, an bigger umbrella policy, obtaining mortgages in your own name so she remains debt-free, etc.   

If the house burns to the ground I need enough $$ to actually replace that asset and put me back like I was before the incident.