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Updated about 4 years ago on . Most recent reply

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19
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James Lin
  • Investor
  • Los angeles, CA
0
Votes |
19
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Should I purchase and inherit tenant without a tenant lease?

James Lin
  • Investor
  • Los angeles, CA
Posted

I want to purchase this duplex in cleveland 44120 with tenant in it.  I contacted the agent, she said the current owner of the duplex didn't have a sign lease contract with the tenant.  The tenant called the agent that they want to continue the rent "as is".  Let me put her quote on this message.  

-------------------------


"When purchasing a property with tenants in place, usually the seller has your requested information available.
This is not the case.
From my understanding From tenants who started just recently calling me That they want to continue** as is**With new owner.

That's usually what happen When good tenants don't have leases.
Soon as property transfer title to you. Not before because no leases is in place.
A one year lease would be the only requirement from you as the new owner
As long as tenants pay you your rents on time and is good rental Property tenants
You explained to me it was important to have tenants in place in Properties that you was interested in.
I will wait before sending purchase agreement until I know if there is any security deposits /amounts For purchase agreement. that is credited to you at title transfer
at the title company
It's a easy process All is explained in details
It could be your property In 12 days.
With all terms approved by you the buyer and the seller
Yes Seller is ready to move forward.

--------------------

 It is just month to month.  She said once I take over the title, I can put a simple rental lease and continue as is.  

Please give advise. ...

Most Popular Reply

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239
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224
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James Maradits
  • Real Estate Broker
  • Cleveland, OH
224
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239
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James Maradits
  • Real Estate Broker
  • Cleveland, OH
Replied

Between this and your other recent discussions, it definitely sounds like you did not chose the right agent to work with on this deal.  I would be more careful moving forward to ensure that you find someone familiar with dealing with investment properties like this one.

It's fairly common to take on an occupied property without leases in place and often times it can be an opportunity.  When doing this, it's extremely important to verify that there are in fact no leases in place to protect yourself against the event of a tenant actually having a lease with terms that were not accurately stated (example: if the seller says the tenant is paying $1000 a month but they actually have a lease for the next 10 years at $500/month that you would be stuck with).

It's probably a good idea to assume/budget that you will make no profit the first 3-6 months of ownership until the property is stabilized (repaired, rented, whatever you need to do).  This might not be the case, but it would be better to prepare for the worst rather than put yourself into a risky situation.

  • James Maradits
  • Loading replies...