Yes…so if the rental property has. Down payment of $250,000, presumably that $250,000 would be the equity in the property…and would count as an asset. Plus the rents wouldmbe income.
But the bigger question…the family is borrowing $250,000 for the down payment. The mortgage would then be $400,000. What lending institution would lend $400,000 to folks with an annual income of $25,000.
Something isn’t adding up.
But back to my advice.
This student needs to talk college finances with the parents. Find out what the parents can and will pay for college.