If you decide to allow your tenant to continue (but now paying a premium), be sure to get insurance from a company that specializes in short-term rental coverage.

. * buy/rent in restrictive areas where rent can’t fluctuate drastically* Look in restrictive areas — cost to build barriers of entry * 65% debt coverage* Cranes in the air, beware — means addition of supply* P&L — profit and lossCardonecapital.com——————————————Ep 260 Chris Voss* Fundrise — fundrise.com/biggerpockets * Never Split the Difference — Chris Voss* People are afraid of negotiating because they don’t like conflict, or the feeling of beating someone else down* Last impression is a lasting impression* There’s always something more important to someone in a negotiation than making the deal — lots of people just want to be heard-out* Seek first to understand then be understood * You get what you want by hearing the other side out — people want to be respected, heard, appreciated* People want to “feel” good about the negotiation * Offer, “Ok we’ll do it your way” * Let them feel in control — “how are we going to do that?”

The available options for warranties break down into things like:exterior main water line coverageexterior main sewer line coverageinterior plumbing line coverageHVAC (cooling system) coverageHVAC (heating system) coveragehot water heater coverageelectrical system coverageWe broke down two viable options:Option 1:  Evaluate Risk/reward likelihood on each property as to whether we get individual coverage, total yearly cost of this is ~$2100/yr which comes to approximately ~2% of our gross rentsOption 2: Go with full coverage on every property we own, total yearly cost of this is ~$5100/yr, which comes to approximately 4.5% of our gross rents.We usually work off a 15% goal/assumption (of gross rents) that allows for costs tied to vacancy/maintenance/capEx items, which so far (been operating for 3-4 years) we have been significantly under that. 

This should be his insurance liability not yours.Yep, his comprehensive coverage on the truck.

However, I don't buy units that lease for under $600/door, and I like a 150% debt service coverage ratio.Hope this helps frame your search!

@Casey Charkowick I think you need to do some more research to narrow down your expected rents a bit more - the range $2400 to $3000 is pretty wide, and makes a big difference.By my estimation, it's about a 2% cash on cash return if the rents are $2400/mo, and about 5.5% if they're $3000/mo, with debt service coverage ratios of about 1.18 (bad) and 1.48 (very good), respectively.If the realistic expected rent is $2400 I would not do this deal.

The bank pays $200/ month for insurance with $700k in coverage.

It's one of the most comprehensive on wholesaling that I can recall. 

I am pricing out insurance companies right now and I’m swimming in coverage line items.

When in doubt, most people who aren't experienced with this type of thing will find the local REALTOR association contract to be the most comprehensive as well as fairest to both parties.Myself personally I would use a simple one pager with terms favoring ME.