I'm going to be closing on a short sale duplex this week and inheriting tenants in each side who are on month to month leases. My loan conditions require me to reside in the property, so I will have to give a notice to one side. I'm having trouble deciding who to give notice to. I've met them all already while doing work on the house to satisfy the inspector's requirements. Both sides desperately want to stay and seem like great people. But they also both have some issues. I ran their names through CCAP and found lots of issues.

Side 1 has a foreclosure on their record. They have 2 cats, 1 dog and the adult daughter living with them has lots of other pets kept in cages (pets like guinea pigs, snakes, rabbits, etc.) The place kind of smells like animals when you walk in. It does not smell like urine or anything of that nature, it just has an animal smell. I also found that the daughter has several felony convictions (damage to property and battery) and that the parents are having their wages garnished in the amount of $45,000. This has apparently never stopped them from making a timely payment however. They seem like very friendly people who want to stay.

The second set of tenants has apparently had issues making their rent in the past according to the current landlord, but since they have found new jobs (within the past 6 months) and now make more money they have not had this issue anymore. However, I found that they also have a foreclosure on their record and that apparently the man has an upcoming lawsuit being brought against him from a medical provider. This has me concerneed as to whether or not they will be able to make payments as well. They are very good people and have actually contributed to the property by fixing it up in some ways. I had originally leaned toward keeping them but now the medical lawsuit has me concerned.

Both tenants have issues, but I do not want to get rid of both sides. This will be my first rental propery and I do not want to start out looking for tenants when I already have tenants who love the property, want to stay and pay rent. I realize that I could also eventually do a credit check to make a more informed decision, but I am not yet the current landlord and time is very much of the essence in my situation. Also, I feel like CCAP has given me a lot of information already that could help me make an informed decision. I am just looking for advice from other more experienced investors on what I should do in this situation.

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