So Those capitalized expenses do reduce your net profit.Unfortunately though, if you do a 1031 exchange as @Drew Reynolds, you must reinvest all your cash proceeds and purchase at least as much as your net sale in order to defer all tax.  

Do not use credit karma or any of those other credit report websites those sites do not give your real credit score but a consumer score which can be 5 points to 100 points difference.

Using the proceeds wisely for another great deal on another home and maybe a Multi Family investment.

You can also ask the seller to pay closing costs out of his proceeds so that you come out of pocket even less.

I'm ready to purchase the property and I wanted some advice on how to proceed with the tittle transfer etc.

Hi Rao, I am curious, did you proceed with the purchase of this daycare property?

You can proceed with eviction if you wish, but in CA the courts are always backed up so it might take some time, even with a default.

He then proceeded to call the tenant and offer her 200 off her rent to stay! 

Use the proceeds for additional investment properties.  

It's probably best to proceed at $30,000 if it works for you.