All Forum Posts by: Nathan Trotter

@Matthew Irish-Jones haven’t checked BP in a long time, but man this was presumptuous of you.

My mom owns a home in McKinney, TX. Current loan outstanding is 190K on 3% interest. House needs updating but resale value is around 350-375k.

She wants to sell the house to move closer to me and her grandkids. She’ll need the money from the sale for down payment on her new home.

McKinney is such a great location and I could easily rent the home for 2x her current monthly mortgage payment, but I’m trying to figure out how to buy the house from her in a way that makes sense for both of us. I want her to get a fair offer, but I also feel like there’s an investment opportunity here somehow.

Anyone have thoughts on a creative way to do this deal?

@Theresa Harris

Thanks! My sibling is on board with me doing this.

Still trying to work out the details of what renting to her would look like!

@Dwayne Poster I have one sibling but I have run it by them to see if they wanted in. They don’t have the cash currently but they were fine with it. I told him he could always buy in later on some sort of proration.

My mom is open to the idea but wants to know all scenarios of the deal (up front deal, but also all of the clauses and what-ifs for the future if she loses her job, something breaks, I need to sell for some reason, etc..)

@John Carbone thanks! I will check it out.

Long story short, I am trying to run scenarios for purchasing my moms home from her and renting it back to her. Her current mortgage is 200k but she could probably sell as is for 325-350k. It could use a lot of updating but she could not afford to make the updates. She can’t afford a higher monthly payment and would prefer not to do a cash out refi. Her loan is not assumable.

The thought is that I could buy the house at her current mortgage rate and then rent the house back to her at a discount for a couple years so that she has a little more financial breathing room. I would also redo the floors, kitchen and backyard (est. 40-50k improvements) within a reasonable time frame.

She would get cheaper monthly payment and an updated house that she can enjoy more. I would be getting a good chunk of equity.

My question is: does anyone have any creative ideas on how we could structure this deal? This will be my first “investment home” and it’s obviously not a traditional route in that I would be negative cash flowing for a while with a good amount invested up front. Keep in mind I’m trying to help my mom, but I also want to make sure it’s a good deal long term for me.

Another thought would be to buy it for 250k with the idea that she would hand over the 50k payout to us to use for the improvements.

Any thoughts appreciated!