The most efficient way to handle this IMO is to pay have your friend hold a note or if he wants and equity position treat it as if he is holding a mortgage at an agreed rate of interest and you may even want to include him in on a percent of the gain if the property is sold.

If it falls thru, then there's nothing gained, and very little lost.Lynn (FL)

I think at best we may see small gains in some markets, but many will remain flat or continue to decline.

I would actually prefer to have a steady passive income/cashflow rather than assets.

I am concerned because in case I want to sell the house at some point, I'd like to reduce my capital gains taxes as much as possible.

If you live in it for 2 years, there's no tax on your gain.

If I can get a quick sale I'll avoid the capitals gain tax, but that may not happen.

Once I purchase at tax sale, I drive to the house, gain access and change the locks.

(assume that I'd be able to get qualified for the loan and that it would be "reasonable" to be able to pay back the 40K in the time specified)after re-reading, i assume the investor would need to be a lienholder from the beginner under any circumstance...but is that even possible, or would I have to buy the house "with" the investor, which i'd rather not do...also, do not dwell upon the legal details of the arrangement, i have people that I could do this with on a verbal contract not to mention a seperate written contract that protected their investment+interest in the event I sold the property for a gain...I'm much more concerned about the actual numbers/percentages and how realistic this proposition is from an investment standpoint, not a legal one..

I hope to gain some insight from your experience!