Purchased Rental with Tenants and lease

[Chad Brady]

Investment Info:

Single-family residence buy & hold investment in New Braunfels.

Purchase price: $211,000
Cash invested: $45,000

This was the 3rd rental for our portfolio. I purchased this one with tenants and a 10 month lease in place.

What made you interested in investing in this type of deal?

I was interested in this one because it already had tenants that had been in the home for a year and had just extended their lease for another year.

How did you find this deal and how did you negotiate it?

I found it on the MLS. My main focus was to minimize my initial investment so I focused on getting closing costs paid for.

How did you finance this deal?

Conv 30yr Fixed rate with 20% down.

How did you add value to the deal?

No value added.

What was the outcome?

It was fun closing on the 30th and walking out the door with a check from the owner for the deposit as well as getting the rent check the very next day.

Lessons learned? Challenges?

I learned that it is nice to buy an investment that already has a tenant and lease. The drawback is that this lease is written slightly differently than my usual leases so I have to remember that the grace period and other things are not the same as my normal leases. I also didn't get to screen the tenants so I don't have a relationship with them like I usually do with my tenants.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Nick Drake