Land contract on apartments, 5yr balloon, new to investing.

[Brian Fosmore]

I'm currently managing a small apartment complex, and the owner has offered it to me for below market value on a land contract. Roughly $240K value, LC would be $200K with a 5yr balloon. Balance due in 5 years will be approximately $150K. $10K down payment would be on a personal loan from my fiancee's stepdad, to be repaid within 36 months, first payment not due for 90 days.

At current rental rates, assuming 90% occupancy (there are ten units, total), after land contract payment, profit would be $600/mo. Rental prices are below what they should be, and as tenants rotate out, rent will be going up, after minor improvements are made in each unit. (10 month ROI for each unit's upgrades, at the higher rent tier)

After rent is at the higher tier, profit each month will increase to roughly $1500/mo.

I know forming an LLC will be in my best interest for this, but here's where I'm not finding anything useful online.

My personal credit score is about a 590, and my fiancee's isn't much better. By having the income from the apartments paying for all costs, and none of my own cash out of pocket into the deal, how much will my personal credit score affect any future business financing deals? When the 5yr balloon payment is due, will a 5yr positive P/L ratio likely be sufficient to refinance the property? I'm going to attempt to get a business credit card to pay for all utilities, taxes, maintenance, and other incidental costs. Or, is credit card utilization not the best way to build a business credit rating? I will be speaking with the current owner to see if the land contract will be reported to credit bureaus, as well as S&P.

Oh, and my personal credit rating is improving all the time, as I pay off old debts... (divorce)