Inheriting tenants on my first deal - what does day 1 look like?

11 Replies

Hi John, congrats! You should be receiving the Contact Info and Leases for the current Residents as you finish the closing process. You can stop by and say hi, give a phone call, or just mail them on who you are, where to send rent, etc. Totally up to you. Carefully review their leases to see what you and they are responsible for, and unfortunately most leases out there stink. If they are month to month, you can get them on your lease that you are comfortable with and negotiate a new rental rate if they are severely under market rate. However, if you are going to do this, it's best to go meet them in person unless you are using Property Management, then they can take care of everything! Just know that the new Residents likely aren't going to trust you, and that inherited Residents sometimes don't work out very well. Just don't get discouraged if things are a little rough in the beginning. Good luck!

@John Bradley , along with what Dave says, you should actually already have a copy of the lease, I would assume.  Day 1 you are bound by those, and hopefully have met the tenants already to understand any issues they are already having: toilet slow to flush, heat intermittently working, etc.  Things that your inspection may have missed.  

Personally, I would make an effort to meet them all before closing, and let them know you will be sending a certified with return signature letter for them with your information, new rent payment address, etc. I would also have a copy available to hand them when you meet them, just to be extra certain. Certified is important, in case they try to agrue that they never received it and therefore mailed rent to the prior landlord.  

From there, tenants will treat you how you train them to.  If you are responsive and professional, tenants will treat you that way. 

In your intro letter, I would also outline your preferred communication channels.  Should repair requests be sent via email, text, phone call.  Should rent checks be mailed, will you pick them up in person, etc, and while you cannot change the lease terms they are under, I would be clear that checks must be RECEIVED, not post marked by the date outlined in the lease, to no be considered late.  I have that language in my lease, tell each tenant at lease signing, and remind them that USPS is inherently slow, but still have people complain when they get a late fee because they mailed their check on the 4th, and so I didn't get until the 7th, with late fees starting on the 5th.

@John Bradley

Congrats!! First get a copy of Brandon Turners book on how to manage rental properties. It’s a must and will help answer questions like these. I would put a letter in each mail box introduce yourself or preferably your company. In that letter it should have your contact info which should be a google voice # and a email address dedicated to your rentals. It should also have the info on how to pay you, preferably online. My letter state several times how on time payments is extremely important. State it then reiterate it. The letter should be mildly warm but stern. Setting the tone is everything. I don’t think door knocking isn’t necessary. Good luck!!!

@Anthony Vander Meer

"Mildly warm but stern" -- spot on. A letter and meeting them in person is a good approach. Just remember they may appear to you on first impression as the best tenants and the most likeable people, and maybe they are, but they're not stupid and they know how to read and play people as needed. The units may even be spotless but it doesn't mean they're going to pay on time or there isn't some kind of drug activity and "cousin Joe" living on the couch. Make sure to enforce and chase down late fees even if it's easier to say "just get it to me by Friday". Be firm and consistent. In my experience, you've probably inherited 2 dream tenants and 2 tenants that will be gone in a year through eviction out turnover. Good luck!

@John Bradley

I don't have a boilerplate letter, but it shouldn't be anything overly complex or customized to each tenant.  

Here are the items you want to make sure you include:
- Managers name and contact info
- Preferred method of communication, any systems you use, etc
- Rent Payment Address and any system they can use to pay rent, i.e. cozy, etc
- First rent check that need to be mailed to that address
- Notice address

I would also include a form for them to complete and return to you to include the name, phone number, email address for each adult residing in the space.