So I just got an accepted bid on a short sale property about five minutes from my house. It was built in 2007, is in pretty great shape, and I got it for a heck of a deal! The property value estimate (haven't had an official appraisal yet) is around $72-78k. They were asking $64.5k and I got an accepted bid offer at $62k. For a few months worth of waiting through the short sale garbage, I'd say it's worth it! Instant equity. From what I can tell, the only thing it needs cosmetically is some new carpet, some paint, pressure wash of the outside, some new blinds, and a new fence. Still need an inspection to tell if there is any other damage that I can't see, but it was built in 2007... it shouldn't be THAT bad, if anything. And if it is, I can always get my binder deposit back. New A/C unit and water heater, roof looks really good too. 3br/2ba 1,152sq. feet w/ one car garage. I'm guessing that I should be able to rent it from $950-$1,200 for the area. Not gotten an official estimate on that either yet, but I'd say that knowing rent prices around me, it's pretty fair.
So this is huge for me. I'm excited about it, but nervous about getting shitty renters. I've heard too many horror stories. I was told to always run credit, but not sure what exactly to look for. 650+? Everyones credit is in the dump right now except mine, it seems. I'm thinking of asking for first months rent and a deposit equal to one months rent before move-in. If they have pets, should I charge monthly or do a one time pet fee of say... $300 or so? What about more than one pet? How long should I have the lease for? one year minimum? month-to-month? six months? What about the lease itself? Should I write up my own or maybe go around to an apartment complex and put my name at the top and use theirs (or a slightly edited version of theirs)?
I know about the 1% rule and I'm pretty sure I did well in regards to that. I'll absolutely be able to rent it for $620/mo. in worst case scenario. I'm renting a single room in my house for almost that much. Anything I should be on the lookout for as a new landlord? (And by new, I mean with them having the whole place to themselves without me living there too) Anything I should know?
Oh, and what about taxes? How do I deal with that now? Do I need a business name and incorporate or what? Insurance?