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FirstSource: Any advice about purchasing a house out-of-state?


hinky
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It would be a rental, rented by a very dependable family member. We will use it to build some equity since the prices here are just outrageous. We would probably sell it to the family member after a few years (a lease-option is a possibility). Please ask me any questions you need to.

Thanks!! :)

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Most of the problems you could face are taken care of by the fact that you are renting to a family member.

That is as long as they don't currently own the home you are buying. Then it becomes more interesting.

When you are figuring the $ amount to charge for rent, understand that you can count 75% of the rent as income but have to figure in your debt ratio 100% of the expenses. Allowable rent is normally determined by the range of rents paid for comparable properties in the area. When you get the appraisal you will need a "market Rent Analyisis" in addition to the normal appraisal. that will give you the acceptable range.

Charles

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Normally a FSBO is done to save Realtor commissions, so your seller may not be interested in paying even 1/2 commission. You can ask however.

Also, you might consider using a Real Estate Attorney to either draw up the documents or check them over.

Charles

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