This was easy

[Mineto Anfield]

Helped someone else out, but this one is paying off. Relative did not want to make mortgage payments on current home and new home purchase. I suggested that he rent the current home to cover the mortgage, but he didn't want the hazzle. All he wanted was to be free of the payment. I took over the payments and the property is deeded to me now. I have a signed lease for a tenant moving in 1 April whose rent payment will more than cover the mortgage. My plans are to refinance the property to get a lower payment and better cash flow. Is the refi a good idea?
I'm really starting to like this real estate investing:)

[Don Konipol]

Sounds good, but please be aware that rental property expenses are always much greater than just the mortgage payments. Even if your payments escrow for taxes and insurance, you still have to contend with vacancy loss, repairs, maintenance, depreciation, tax preparation and planning expense, occupancy permits, special assessments, tenant damage, any casualty loss up to insurance deductible, property management fees, etc. On average operating costs (all costs save mortgage interest) tend to run 40 -50% of income. Some of these are easy to miss since they occur infrequently - like repairs. Others like depreciation may not occur until you sell - when you need to discount your price - or when you need to replace the roof and haven't reserved anything in a depreciation account to make this improvement.

Not trying to discourage you at all - just trying to give you some important information. Since you were able to purchase the property with little or no cash outlay, and rent the property for more than the payments, you probably have a profitable deal.

What you have done is called purchasing a property subject to the existing mortgage. Search the forums on this site for "subject to" and you will get enough information to decide whether you want to pursue this type of real estate investing.

Anyway, Congratulations and the best success for you!