House #5 - An Experiment

So, my brother is in a position where they are expecting and the house they are currently renting isn't going to cut it anymore.  He doesn't have the cash to buy yet so he's going to rent.  We decided to look for a house for the company to purchase and him to rent.  There are many different schools of though on doing stuff like this with family and friends, so we'll see how it goes.  We all agreed to the following approaches to ensure there are no surprises and it goes smoothly.

-- The company has certain criteria so it must meet them.  We agreed that the house must cash flow $300/month for it to be worth it to the company.  We agreed that rent would be whatever it needs to be to make that happen.  This ensures that the following is met.
-- Emotion would come out of it.  This is easier said than done.  My brother would find the house and it will be the sole discretion of myself and my father as to whether or not we would purchase.  This takes his emotions out of it.  Again, if we turn down a house he really wants that could cause contention but we have a relationship level that transcends that in my opinion.

With that being said, we identified a house.  Turns out the realtor refused to pay the referral fee to my Father's appraisal company (which is a requirement of every deal we do).  This caused my father and I to say no to the deal.  My brother whole heartedly agreed and we walked away.

We've identified a second house (which is a short sale) that meets our requirements.  We've made the offer.  However, short sales are different animals and this is a new venture for us.  We've been told it can take up to 90 days to close.  None of us have ever bought on a short sale before so we're researching it and I'm sure the process will be full of lessons (hopefully none that we have to learn the hard way).  We don't even know if we're past the point where someone can come in and offer more.  With that being said, every thing we do in this process will be run by all 3 of us before a decision is made so we can reduce the chance of mistakes.  I'll keep everyone posted.  Should be an interesting experience!

UPDATE (9/1/13):
We had a timeline and we never did get an acceptance back from the bank so instead of looking for another house, my brother decided to just rent from someone else.  Probably a good decision in the grand scheme of things.  So now, no matter what happens, where he lives is separate from our company and no harm can come out of it.