Coronavirus: How to Maximize Rent Collections During a Crisis

Coronavirus: How to Maximize Rent Collections During a Crisis

2 min read
Brandon Turner

Brandon Turner is an active real estate investor, entrepreneur, writer, and podcaster. He is a nationally recognized leader in the real estate education space and has taught millions of people how to find, finance, and manage real estate investments.

Experience
Brandon began buying rental properties and flipping houses at the age of 21. He started with a single family home, where he rented out the bedrooms, but quickly moved on to a duplex, where he lived in half and rented out the other half.

From there, Brandon began buying both single family and multifamily rental properties, as well as fix and flipping single family homes in Washington state. Later, he expanded to larger apartments and mobile home parks across the country.

Today, Brandon is the managing member at Open Door Capital, where he raises money to purchase and turn around large mobile home parks and apartment complexes. He owns nearly 300 units across four states.

In addition to real estate investing experience, Brandon is also a best-selling author, having published four full-length non-fiction books, two e-books, and two personal development daily success journals. He has sold more than 400,000 books worldwide. His top-selling title, The Book on Rental Property Investing, is consistently ranked in the top 50 of all business books in the world on Amazon.com, having also garnered nearly 700 five-star reviews on the Amazon platform.

In addition to books, Brandon also publishes regular audio and video content that reaches millions each year. His videos on YouTube have been watched cumulatively more than 10,000,000 times, and the podcast he hosts weekly, the BiggerPockets Podcast, is the top-ranked real estate podcast in the world, with more than 75,000,000 downloads over 350 unique episodes. The show also has over 10,000 five-star reviews in iTunes and is consistently in the top 10 of all business podcasts on iTunes.

A life-long adventurer, Brandon (along with Heather and daughter Rosie and son Wilder) spends his time surfing, snorkeling, hiking, and swimming in the ocean near his home in Maui, Hawaii.

Press
Brandon’s writing has been featured on Forbes.com, Entrepreneur.com, FoxNews.com, Money Magazine, and numerous other publications across the web and in print media.

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YouTube
Instagram @beardybrandon
Open Door Capital

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I was a little worried a month and a half ago when this all started going down. I thought, “Oh, man. What if rent doesn’t come in?!”

Then we were at like 96% rent collected for April—about where we would normally be.

My personal investments were 100%. My mobile home park fund? We’re at almost 100.

Because of this, I feel a lot more confident now than I did a month and a half ago. But even then, we had a pretty solid plan in place.

This Is Why I Don’t Fear Not Getting Rent

Just because “tenants don’t have to pay rent because you can’t enforce that right now”—because the government’s basically saying you can’t evict—eventually they still owe that money.

And so, even dumb tenants are going to realize that they’re going to owe that money eventually, and they’re never going to able to come up with it.

Why would they suddenly have five times that much five months from now? That is not going to happen.

Related: 12 Influential Investors Weigh in on How to Survive the Coronavirus Crisis

So they all realize that yes, they can play that game if they wanted to, but they’re not going to.

Now, some people just literally could not afford it. Like if they really lost their job, they couldn’t afford it.

Well, thankfully, the government stepped in (or maybe not thankfully, depending on how you look at it). They threw $2.5 trillion at people to help with that. That’s going to help a lot for the short-term.

Brandon writing in notebook

This Is When I Would Start to Worry

Now, if this goes on for the next year and people are out of work for a year, we’ve got some serious problems and discussions to have.

But if that happens, we’re looking at a complete meltdown of the entire American financial system. And something will happen whether or not every single solitary person goes bankrupt in the country, or they do a reset, or they change the laws or whatever. Something will happen.

I’m not worried about that because they can’t let the entire world meltdown. They’re not going to. At some point, laws will change or people will figure things out.

Related: How to Be a Hero (& Grow Your Wealth) Amid the Coronavirus Meltdown

So anyway, we’ve had a solid plan in place. And if people really couldn’t pay, we would put them on a payment plan—like a 12-month or 10-month payment plan.

You didn’t pay your $500 rent? OK. We’re going to spread it out over the next 10 months, and you pay $50 extra each month. Then at the end of the year, we’re all good. Not a big deal.

And so again, I don’t invest in real estate for a week or for a month. I invest in real estate for the next 10 years. So 10, 20 years down the road, when I look back and go, “I remember that weird time where we had rent that was delayed by a year, and we had to spread it out for 10 percent of our client tenants. Yeah, that was weird.”

But it hasn’t really been that crazy for me as a landlord (yet!).

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What has your experience been so far?

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As a landlord, I was a little worried when the coronavirus first started disrupting lives, causing layoffs, and so on. Would tenants pay? But so far, most of our rents have been collected. And for the few tenants who fell on hard times and really are unable to pay, here's how I've been handling it.