Buying a duplex with HUD tenants

[Slade S.]

I am now under contract with a seller for a duplex. In our purchase agreement the seller and I agreed that the house would be vacant and it is the seller's responsibility to give notice and pay any costs to remove tenants. My realtor assured me the tenants would be gone at closing.

Now my realtor tells me her and the sellers realtor made a mistake and these are HUD tenants and have a contract that cannot be terminated, but once I own the house, I can terminate their leases.

My plan was to house hack this duplex, but I cannot do that if the units are not vacant. My deal analysis only turns a profit if I increase the rent. I am now hesitant to move forward, worried about contingency periods, worried I will lose my deposit, worried Ill purchase a duplex with an income lower than my expenses!

This is my first rental property purchase and I have limited knowledge on how HUD rentals operate. Please if anyone can offer some advice please do.