Hello BP Members,
Currently my mom and my aunt own a 4 family home that they had inherited from a family member. The property is paid off (mortgage free) and all of the units are rented. My aunt is looking to sell her portion of the property as she is getting up there in age. My mom would like to keep the property as it currently pays all of its bills and all of her property taxes on her single family home.
I was asked if I was interested in purchasing her half and then have opportunity to own all of it in the near future. The property is very well maintained and rents quite fast.
I do not want to purchase into the property using a conventional loan putting 20%-30% down.
My thinking was to have my name placed on the title of the home as an owner and letting my aunt keep the cash flow from the rents for a year. Then when the year is up refinance with a lower interest rate loan. Essentially this is like receiving a private loan from my aunt and then after it seasons refinance at a lower rate. Is this even possible?
If not what other options do I have? How may I obtain this property with 0 or low money down?
House hacking is not an option for me as a do own a SFH with my wife.
Thank You for your help
Do your mother and aunt own the property as Joint tenants or tenants in common? How they hold the property will impact the options available to you and the financial impact on your mother and aunt.
The unwieldy acronym "BRRR" is not really applicable here, however you could purchase your aunt's interest through an instalment sale - though her name would typically remain on title until you had completed the transaction. If they are Tenants in Common your Aunt could sell her portion with little immediate impact on your mother, if they are Joint Tenants, this may not be the case. You - and your mother/aunt - should consult with an accountant and/or attorney, who practices real estate, prior to structuring any deal.
Thank You for the reply! I will find out that information and most likely consult with a real estate attorney
Is your goal to get money out of the property, or own the property? If it is to own the property, would your aunt consider seller financing the property to you for a period of time?
My goal is to own. My aunt would like t take her half and buy a home out of NJ as she has retired and widowed
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