Something that you should give him a heads up on before you do so.Then there is the situation that you may potentially be required to report the income and not the interest expense.If your income is above $150,000 - you may not be entitled to the rental deduction(which includes 50% of the interest expense); but you may be required to report 100% of the interest income associated with providing a loan to the business.

I am interested in investing in some of the outer areas of St Louis including Florrisant, Ferguson, Calverton Park and so on.

If you want to include him in on the profits it becomes more complicated.

Very often a divorce includes bankruptcy.

My mil has excellent credit, 800+, with no debt.Any ideas on how make this happen.Heloc would be great, but the 15 year term makes the payment too hight.A 3-1 ARM would work, with co-signer, as we would refi after the second year with solid rental history adding to my mil's income so she would qualify at that time.Below are some quick numbers for this project$180k - ADU Budget$142k - Current mortgage$942 - Current monthly mortgage$585k - Current Value of home/property (no including basement refinish or ADU/Garage)$1800 - market rent on ADU$500 - current walkout basement rent ($1200 market)$2200 - mil's fixed budget (PERA retirementThoughts?

However, the benefit I have right now is the fact that the rents are not yet registered with the town.So keeping the tenants as is with the low rents will set me up for low rent registration.Instead, I would rather get them all out, do the necessary renovation, including separating the boilers, this way each tenant pays their own heat and hot water.

If you are making a bunch of improvements before you make the unit available for rent, you can include it in the cost basis and depreciate over 27.5 years, but you may not want to.

What other expenditures should I include when evaluating if a deal will give me good cash flow and cash on cash return?

I know a lot of speculation, but if I have multiple exit strategies including possibly holding the property for much longer up to 5-7 years then it may not truly matter; although going in on higher cap may always be better because you have a greater chance of lowering.I don't know, just feel like, I am talking myself into it, buying now.Best time to buy may be brief period when the cap eventually goes high with market crash or adjustment and eventually the interest rates will need to be lowered to revive economy!

Zoning, financing, environmental Phase I and Phase II, you may want to include geo for raw land.