If a tenant (friend) needed to move, I wouldn’t want to be in a bad situation financially.

If a tenant (friend) needed to move, I wouldn’t want to be in a bad situation financially.

You would have to go after the one individual for non-payment and you could only remove the other three by going through the legal process like you would for someone on a verbal agreement, which puts you in a he-said, she-said situation. 

While institutional lenders would probably need a number years proof of collections before considering the income from the wrap, private lenders, such as myself would look upon the situation more favorably.  

Hi @Leah Miller,That’s a frustrating situation, and unfortunately, it’s not uncommon.

@Frankie Paterno I have talked with a number of investors in your situation. 

Here is how we usually handle situations like this: if a tenant communicates with us, we usually try to work something out with the tenant. 

Your property is fairly destruction proof, costs near nothing to maintain, yet you can charge above market rents.If your property is nicer (class B) where the carpet alone might be $6k or more to replace when the tenant spills hair dye everywhere, you won't be as happy as in the situation above.  

I would encourage the use of a warranty deed to the situation that @Steve Vaughan mentioned above.

The technicals (migration rates, job growth, tax situation, debt cost, etc) to work as well.