My intention is to move into buying REO bundles as soon as I finish a transaction I am working on which will leave me with a little over $100 million, and that is due to close by Christmas.

That leaves you a BIG montly negative.

I include a clause in my lease that changes it to 20 days, that way notice can be provided in the first week of the month for a change either by me or the tenant if they want to leave.

It would lower his taxable income and reduce his taxes owed, so he gets a benefit there.In the end, if Mike wanted to leave, then Joe does not have to quit-claim or sell the property to another LLC.

If its occupied, show up at the door right after you win the auction and offer them something to leave.

From my drive-by it looks like the "worst property on a good block"; not in disrepair just a little unkept; ugly mailboxes, dirty siding; leaves not picked up; no sign, very little landscaping.According to local banks, cap rates on deals are 8.5% on the low side to 10.5% in the mid-high side.What would you guys offer?

So we would be have a monthly interest only payment of $1868.75 at 7.5%.Leaving a reserve of $131.25 to save for repairs and what not.

Sounds like you have a freak for management on your hands...Some landlords and property owners think and feel they have to run the lives of their tenants… I am more of a "I will leave you alone, if you leave me alone" type of manager.

Doesn't leave much margin against the inevitable issues that crop up, though, so I think I'd tend to stay at a lower purchase price.You do get free living space for a year.You want to avoid it becoming "your house" and letting your own tastes have too much influence over what you do.A risk is that the market may be very different a year from now than it is now.

I think you are asking for trouble if you leave it to your tenants, but then it is only an opinion.