Thanks in advanceDown payment: ~90k (25% downpayment)Rent per month: 2300 (5Bed, 4 Bath) with 2100sqftProperty management: ~150 (monthly)Outstanding loan around : ~268k (7.675% APR) 30years fixedLandlord Insurance: 1500$ (per year)HOA: 1600$ (per year)Keeping an eye on interest rates for refinance, so I can then move this property to an LLC instead.

However, I did take issue with the tone of the message, especially the part where they told me how they’d be paying rent.For context, there are no outstanding maintenance or repair issues, so I’m unsure what the tenant is referring to. 

Phoenix contains a rare combination of elements that have created an outstanding market for distressed property investments, including the following:Cost Savings: Distressed properties are sold below their market value and enable investors to take hold of properties at a trifle compared to traditionally listed properties.Strong Market Fundamentals: Being among the fastest-growing cities in the country, Phoenix ensures a high demand in housing and rentals, hence good potential for resale or income from rentals.Value Creation Opportunities: Most distressed properties need renovations; thus, such situations present opportunities for investors to increase equity by adding value.Population and Economic Growth: Phoenix remains among those cities in the country which are attracting more and more residents and business; therefore, this presents good, long-term appreciation possibilities of property appreciation and income creation.Challenges to ConsiderWhile the rewards can be great, distressed property investment is not without its challenges.

Tenant covenants and agrees to pay interest at the maximum lawful rate or eighteen percent (18%) interest, whichever is less, compounded annually, on all unpaid Rent, damages, and other amounts owed by Tenant, excluding late fees, from that date of Landlord’s final accounting until such time Tenant pays all such outstanding amounts.

Some people only want 10-20% of their outstanding lines/debt balances available while the other 80-90% to be in fixed rate notes.

If you've done a complete renovation—say, updating a 60-year-old building to 2025 standards—their quote could be outstanding.

For your 1st time, pay a Property/Land/Transaction Attorney to review the title commitment with you to make sure that there are only the outstanding liens on the property, and that the owner has title.- Collect Tax Certificate to verify Property Taxes are Paid- Get a current statement from the seller to verify the existing balance, if they are delinquent, you can get the bank on the phone to verify the amount to make the loan current.- Review the loan documents, there is most likely a due on sale clause, which is why you won't find a title company to process these for you.

We have a HELOC of 80k outstanding so I think the cash on cash return is only going to be 2%.

The reality is though... your only going to be making about $500k on the outstanding principle.

In today’s market most homes will be worth more than their outstanding loan balance unless they are VERY recent purchases with little to no money down.