An Interesting Proposition

Let me preface this by saying that this is fairly hypothetical and very much up in the air at the moment, but it's something for Mike and I to think about in the coming weeks.

A few years back, my BIL bought a house out in the country near where Mike and I would someday like to buy a home as well. At the time, he was engaged and his finace and him worked extensively on fixing up this house so that it would be move in ready by the time they were planning to be married. As it happened, they broke off the engagement and decided to go their seperate ways. His fiance moved out and he remained in the home. The agreement at that time was that within a few months, they would transition the mortgage over into his name only. Well, months turned into years and he never did get the mortgage switched over. Finally, after much prodding by my MIL, he finally starting working to get this done last summer. Apparantly, he doesn't have the best credit and has been unable to be approved for a mortgage in his name only for the home, which brings me to today.

Over the weekend, BIL mentioned to Mike that he would just like to sell the home at this point and be done with it. Obviously, it's up to his ex-fiance as to whether or not she'd like to live in the house at that point (she would most likely be approved on her own) since it's still legally hers, but Mike's interest was instantly piqued by this as we would very much like to buy the home if they decide to sell it. The pros to the situation would be:

1.) While the house would need some cosmetic work, it's in great condition structurally and most of the large projects have already been done to it by BIL and his ex. It has alot of potential.
2.) The only room that would need to be completely updated would be the bathroom.
3.) It is much larger than the house we have now so when we do have children, we can stay in the house longer before needing to move (current home that we rent would only accomodate one child comfortably).
4.) There is a large backyard.
5.) House is on a quiet road that would be great for walking the dog.
6.) We could take advantage of the very low mortgage rates right now and possibly the first-time homebuyer tax credit for 2009.
7.) Since it is much less expensive than homes we are currently saving for, we would have a very nice downpayment and decent equity in it (potentially).
8.) We could get out of the city (which we hate) and finally live out where we'd like to.
9.) Since I'll be graduating in a few months, I'll have the time to devote to working on the home.
10.) It has a two-car garage. We currently can't use our one-car garage because DH works out of it as part of his side business.

The cons include:
1.) Doing business with a family member.
2.) The added expenses since we weren't planning on buying for a few years.
3.) The bathroom will need a complete renovation.
4.) The kitchen will also need some updates.
5.) There is no landscaping to speak of at all.
6.) We'd have to fence in the backyard for the dog.
7.) It would add about 10-15 min. onto my commute each day and about 20 min. to Mike's.

Mike mentioned something to his brother about possibly being interested in it last night so we'll see how it goes. BIL is always staying overnight at our house since he works in the city and spends most of his time at the downtown bars on the weekends. We've always joked that we should switch houses (we currently rent from my MIL - his mother), but for the first time it actually sounds like it may be a viable option for us.

I'm trying not to get too excited at the potential prospect just yet, but it's proving to be more difficult than I thought.