@Joe SplitrockIt's pretty easy to verify who is correct based on the Schedule E instructions... 

thanks a lot for your feedback.I have some close family and friends that will invest initially and hopefully with a proven track record other investors will join.

After the house is occupied, the best, most cooperative tenants may be willing to show it to replacement tenants that you screen if you make that part of your agreement when the initial tenants being leasing.

I get calls almost every day from sellers questioning "cash" contracts on this topic to verify proof of funds. 

Is there any benefit for letting the tenant reside there until we have a contract OR would you initiate termination ASAP to mitigate any potential marketing/sale conflicts with the tenant/tenant's family?

Verify the rents are correct and the tenants are current on all their payments.Why are you moving one of the tenants out? 

This makes it less than 2 months from making an offer to having a tenant in place for more than I initially budgeted for rent. 

The issue was initially diagnosed as an air conditioner that was low on Freon.

If not offset it, reverse it, adjust it or...IT is not about the journal entry, it is about your financial reports in your accounting software that you need to look, verify and then take the step for accurate numbers.

Most commercial mortgages are adjustable rate, but have an initial period of maybe 3-5 years where the rate is locked.