With some prepaid interest, you can extend it a little more. 

Points are pre-paid interest and amortized over the life of the loan.You cost basis for depreciation is from your costs of acquisition as may be allocated, less the fair market value of the land if that value is not stated in the purchase contract, which you should do, state the value as opposed to claiming a valuation or using an assessed value that would usually be lower. :)

Here are the $s:-purchased at $56k-rehab cost of $14k-prepaid interest with my hard money loan (no payments now)-$900/mo projected rental income with tenant paying utilities-appraised at $99,900-I have an offer on the table for $89,900 plus $3,000 seller paid closing costs.I learned s lot on this deal and it wasn't a great one, so neither option (keep or sell) is an awesome one, but I'm new to this and trying to start small and learn.

It seems like a lot of money up front until you consider:Assume the tenant prepaid their last months rent at the old place.

Netspend which is a prepaid credit card has a free savings account that is attached to it you can earn 5% interest on paid quarterly (on up to $1000 above that and the interest rate drops).

One of the tenants has prepaid rent through August 2017.

Rents: $2,350 per monthTop Unit: rented through August 2017 at $1,250 per month (prepaid = no worry about collecting)Bottom Unit: assume it can be rented for $1,100 per month based on Trulia comps with a 2-car garage included and washer/dryer Monthly Expenses: $650 per month$80 Water & Sewer$60 Trash$71 Insurance$200 Taxes$98 Allowance for vacancy$141 Allowance for maintenanceElectricity and heat are separate and covered by tenants.

I then also prorate the last month based on the days of occupancy, and it is all spelled out in the lease.If we are within a few days (generally less than a week) then I won't prorate- say they move in on the 3rd, I just charge one month's rent each month, then the last month they move out on the 3rd and don't owe anything for that month since they prepaid up front if that makes sense. 

My inclination is to refund her within 30 days after the moveout date but she is citing that that is illegal in TX as prepaid rent can't be used as a security deposit.

Don't forget to consider the Prepaids for your taxes and insurances as well.