Help me learn: I rushed an occupied multifamily purchase

[Marcus S.]

Hey everybody! I’m both super excited and second guessing an accepted offer I put on my very first property, a nice four family building with upside for increased rents and overall value. My contract didn’t include any language around the current tenants, security deposits, etc. I can already see issues (annoyances) my rushing will bring me which at the very least includes having to evict a currently non-paying tenant. Fortunately, I’m in Missouri and my understanding is the landlord tenant laws are favorable to landlords.

I’m sure I’ll get through everything, but I’m hoping you all can help me:

1. Identify what should be in offers where there are tenants in place

2. Identify actions (if any) I should be taking on this current property between now, the inspection and closing to minimize my risk exposure

Thanks in advance!

[Jack Luzecky]

Yes, all great responses above. I usually recommend newer investors submit offers contingent on viewing rental verification (income/basic expenses), leases, ledgers or rent rolls. This is a good start to ensure the tenants are paying, expenses are not out of the ordinary, and a timeline for when tenants leases are up for renewal. 

Best of luck. Reach out with any questions.