At a minimum. the investor needs to cover all monthly, debt service, taxes, management fees, expensive, and reserves out of the monthly rental income.

Still, current projected rent is $3,200/month.Current owner (in keeping with the deferred maintenance theme) has very few financial records but does prove up the following actual numbers:-Property taxes, $1,900/year-Insurance, $2,320/year-Owner-paid utilities, $3,429/yearEstimated:-10% vacancy-10% management-15% for maintenance/repairs, and -Reserving $700/month for CAPEXBOTTOM LINE is $34,560 net rental income less $24,700 expenses = $9,900 NOI.Offered $95,000 with $10,000 reimbursed at closing for immediate CAPEX (roof and A/C units).  20% down, loan on balance ($76k) at 6% for 30 years.Cap rate with $400/month rents is 10.1%, cash ROI is 20.3%, and annual cash flow is $4,400. 

. - Confirming that the tenant is on month-to-month lease.

That is only going to kill my reserves and my cash flow numbers. 

foreclosures on the auction sites seem like bargains, but you can't win until you meet a "reserve."  

I would also confirm salary history and reason for the move (job transfer?).

Purchase Price: $425,000Down payment: $100,000Financing: Seller financed, 5% interest, 30-year amortization, 10-year balloonAnnual rental income: $64,620; increases to $68,220 after the $20/mo. increaseTotal Annual Expenses: $48,200 Electric: $600 Maintenance $1,200Sewage: $2,000Insurance: $3,500Capex Reserves: $2,100Vacancy: $2,100Mandorty debt payments: $20,940Taxes: $15,760Net income: $16,420; increases to $20,020 after lot rent increaseThank you! 

Then I have to go to try to find it on Loopnet or Google or go to the Property Tax Website to try and confirm the square footage. 

Provided the plan is approved (confirmed) & the payments are made on time, the mortgage is brought current and the borrower is out of foreclosure.

This is a reserve holding.