For the property managers on here....
I own a property management company and I have a potential client with 30 units. Normally all clients funds are run through the trust account (duh). This owner is requesting that he be allowed to set up an owner regulated business checking for his properties (that our broker will be a signer on). Does anyone allow this to happen? I wouldn't consider it with a smaller portfolio because I don't want to have to do it for every owner. Would it ever make sense to separate out a portfolio?
We do currently manage a 68 unit that has its own owner regulated account, which seems ok given the large amount of funds that one deals with (63k in rental income; 19K mortgage) a month.
Thank you for your thoughts!
I'm wondering if you might get more responses in a different forum, such as the landlord and rentals forum.
I worked as an on-site manager and have dealt with private property management companies in the past, but I'm not an expert in your field.
But, just from life experience, when someone asks for an exception, it raises my spidey sensor. In this situation, then, I'd first wonder why he's looking for a new PM. In fact, you might just ask him. Many people have bad experiences with property mangers, so maybe he's been ripped off, or felt he was being ripped off, so he's shopping. The down side to that, is he may be already looking for proof you're going to rip him off.
So, you may have to spend a lot of time assuaging his fears. That's the first thing.
Then, will this cause you more work than it's worth? Or, will it put you in any kind of a liability situation? Would it be possible for him to say you made money disappear that he actually spent, etc.? Or that the broker paid himself money he shouldn't have, etc.? That just seems like an awkward situation, to pay yourself out of someone else's account.
As I say, this is not my area of expertise, so maybe none of the above is relevant. But, sometimes it's helpful to have someone outside to look at a situation from a completely neutral perspective. I guess mainly, regardless of what type of business anyone runs in customer service, it's helpful to ask yourself if a higher-maintenance customer is worth the money.
When I was screening tenants, and an applicant started asking a bunch of questions that made it clear they would be high-maintenance, I learned to avoid them like the plague, because their requests or complaints would never end. Like an applicant asking if we would put in hardwood floors, or paint the walls a different color, or buy them room-darkening curtains because the street lights might keep them awake at night, etc. You probably have to deal with that, too, but I'm just wondering if it might also apply to owners who appear to be high-maintenance clients.