He moved out in the first week of Sept but started defaulting on rents from Sept and didn't pay early lease termination fee (which is 85% of rent).

:Class A Properties:Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.Vacancy Est: Historically 10%, 5% the more recent norm.Tenant Pool: Majority will have FICO scores of 680+ (roughly 5% probability of default), zero evictions in last 7 years.Class B Properties:Cashflow vs Appreciation: Typically, decent amount of relative rent & value appreciation.Vacancy Est: Historically 10%, 5% should be applied only if proper research done to support.Tenant Pool: Majority will have FICO scores of 620-680 (around 10% probability of default), some blemishes, but should have no evictions in last 5 yearsClass C Properties:Cashflow vs Appreciation: Typically, high cashflow and at the lower end of relative rent & value appreciation.

If there are hiccups along the way, such as a long vacancy, my staff is trained to call or email the landlord with updates (weekly is the default, but some landlords don't want that).A five-month vacancy cost you $7,000 in lost income, plus utilities, landscaping, and other expenses.

:Class A Properties:Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.Vacancy Est: Historically 10%, 5% the more recent norm.Tenant Pool: Majority will have FICO scores of 680+ (roughly 5% probability of default), zero evictions in last 7 years.Class B Properties:Cashflow vs Appreciation: Typically, decent amount of relative rent & value appreciation.Vacancy Est: Historically 10%, 5% should be applied only if proper research done to support.Tenant Pool: Majority will have FICO scores of 620-680 (around 10% probability of default), some blemishes, but should have no evictions in last 5 yearsClass C Properties:Cashflow vs Appreciation: Typically, high cashflow and at the lower end of relative rent & value appreciation.

Play the 'friend in common' card if possible.Regarding seller financing, I don't see this being a viable option since they are in default on their current loan.If funding could be an issue for you, take a step back and work on that first.

If some applicants fall below your requirements, then everyone would be considered "conditional," you can raise the security deposit to mitigate your risk of someone breaking up or defaulting. 

I think they got screwed 5 or 6 years ago with a rash of inexperienced or even fraudulent borrowers who defaulted on their loans, and have since gotten much, much stricter. 

Rougher parts of town have increased maintenance/cap ex, vacancy, rent delinquencies and defaults, and level of effort to manage.  

With an attorney handling the eviction, you can not only ensure proper handling but also take advantage settlement agreements to prevent having to restart the process if the tenant were to default again and get automatic final judgment when the tenant defaults on the settlement agreement. 

Since the borrower had already signed on for $3 million, this was not an increase to make a deal happen, simply Peerstreet personal operating without any understanding of the loan industry and having no intent to listen to the consultant they hired and paid for.Anyway, Peerstreet made the $4.8 million loan, less than one year later it was in default.