Bought a house with a tenant in it.

[Mitchell Litam]

Hey guys!

Very excited to have purchased my first investment house!!

The numbers made sense. It came with tenants that I met. They are currently living there until next Novemeber and hopefully longer.

How does that work with the current lease?

Do I have them sign a new lease or do we all just initial the current lease?

How do I make sure the water and electric bill are all in their names?

Can they put it in their names?

Any common mistakes I could avoid would be greatly appreciated!

Thanks for all your help!

SOOOOO Excited I finally pulled the trigger!

[Mindy Jensen]

@Mitchell Litam , the existing lease runs with the property until it ends, however make sure to read your state's landlord tenant laws, so you know how you can make changes once it comes up for renewal, how much notice you have to give them, etc.

Water/electric bills in their names is a matter for their current lease and your utility company's policies. Some utility companies do not allow the utilities to be put in the name of anyone other than the homeowner. 

Some common mistakes to avoid:

1. Did you get their security deposit transferred to you at closing? Make sure to deposit it into an account that complies with your state laws. (Some states require that you pay interest on the deposit, some require that it be kept separate from any other funds, etc.) 

2. Did you get a Tenant Estoppel Statement before closing? This is an account of the terms of their rental agreement with the landlord. The lease might say $1,000/mo rent, due on the first, but they had a verbal agreement to pay on the 14th, and only $750. 

3. Have you introduced yourself to them and given them a new place to pay rent? Absolutely do this now.

4. Ask them for any repairs that may need to be done on the home. Not requests for things they want, but a list of broken or damaged items that need repair or replacement.

5. Did your seller provide a move-in sheet, that details the condition of the home when they moved in? If not, you need to go over now and take notes about what the property looks like. This current condition is the only one you can charge for when they go to move out. 

But landlord tenant laws are the most important thing. Read them.