I prefer vacant properties to be able to place best quality tenants based on my standards. Unfortunately the vast majority of landlords do not screen very well and rarely understand human nature. This is not to say that they have not placed a good tennat and would not rule out a inherited tenant. I would however thoroughly investigate any tenants record. I dislike have to train another landlords poorly trained tennats.
Bottom line is do your due dilligance and be prepared to replace any inherited tenant.
@Charles Simon McEntee - there is no 'best way' in practically every area of life. Michael and Thomas mentioned some of the benefits/ drawbacks of inherited tenants/ some of the things to be careful when in such a situation.
One way to know what your property might rent out for is checking local rental listings on Craigslist, apartment.com and other such websites.
Good luck and keep asking your questions on BP! :)
I prefer vacant units. If you buy a rental and inherit tenants, I highly recommend you learn how to use the estoppel certificate. What is an estoppel certificate? I'm glad you asked!
The estoppel certificate is a form filled out by the tenant and then confirmed by the Landlord. It's supposed to ensure there are no surprises after closing. For example, you buy the place and the tenant could claim the Seller allowed them to paint the walls black or that their security deposit was twice what the Seller claimed. How will you know? An estoppel certificate fixes this problem.
Some things it may include:
1. Tenant name, contact information, and address
2. Occupancy date
3. Is there a written lease? If so, review it to ensure it matches the estoppel certificate
4. Are there any modifications to the written lease?
5. Are there any verbal agreements or arrangements between the current Landlord and Tenant?
6. Current lease term (expiration date, month-to-month)
7. Current rent rate
8. Rent due date
9. Security deposit amount
You can find plenty of examples by searching for "tenant estoppel certificate doc" or exchange "doc" with "pdf" for more options.
Here is an example and explanation: https://eforms.com/rental/estoppel-certificate/
Some have a lot of legal jargon but this document does not need to be so detailed. This is an important tool for anyone buying a tenant-occupied property.
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