All Forum Posts by: Filipe Pereira

We don't charge an application fee. Some of the states we operate in (Massachusetts, I'm looking at you) simply don't allow it. 

We collect and review applications for free. 

If we think a tenant is a good fit, we send them a request to do the background and credit checks through cozy.co. 

Cozy charges the tenant (I believe it's $40) to do the reports and then the tenants share it with us. 

We don't make a dime off of the fees, and that's the way I like it. I never want someone to feel that I told them to apply just so that I could make a buck. This is why I review apps before asking tenants to do the background / credit checks. 

Someone who is dragging their feet with the credit/background check is also the person who will drag their feet with the application. Basically they will do it wherever the "gate" is. The gate in this case is payment. The conversations are the same at that point "Hey are you going to do this? When are you going to do it? etc. etc." I'd argue there isn't a bunch of time saved by charging a app fee on the front end. 

Yes @Nadir M., do the background checks, and don't increase the rent unless you are expecting significant increases in utility usage. 

Here is our addendum. It is a separate document: 

Change in Terms of Lease Addendum

This addendum dated ___/___/___ shall be incorporated into and made part of the Lease Agreement dated ___/___/___ between ________________________________________________(Tenant) and ________________________________________(Landlord) for the property located at ___________ ________________________________________.

The above named Tenant and Landlord each understand and agree to the following changes to the Lease Agreement: ___________________________________________________________________________________

___________________________________________________________________________________

___________________________________________________________________________________

___________________________________________________________________________________

___________________________________________________________________________________

___________________________________________________________________________________

___________________________________________________________________________________

___________________________________________________________________________________

Except for the adjustments made herein, all other terms and conditions of the Lease Agreement shall remain the same and in full force.

Dated as of this ____________day of ________________________________, 20__________

_____________________________________ _____________________________________

Landlord/Manager 

_____________________________________

Tenant

_____________________________________

Tenant

_____________________________________

Tenant

I'm a fan of keeping things simple and easy to understand @Andrew Threet. I have one checking account and one savings account. The savings account is for any "permanent" money - reserves, cashflow being saved for the next investment, etc. The checking account is for any funds that are transient. Think of it like money comes in and out of this account. Rents come in, mortgage costs go out, reserve funds get transferred to the savings account, etc. The checking account gets brought down to a $0 balance at the end of each month. The money is either used up in expenses, or transferred over to the savings.

As for security deposits, I have found this to be state specific. For example, in Connecticut, we are required to hold the money in an interest bearing escrow account in the name of the tenant. It's pretty easy to set up and we've had good results using a local bank out here. Credit unions do not offer them unfortunately. Check your state laws to see if this is a requirement for you. 

I am anti homes with pools unless your market requires it @Jesse Hodges. 

If your market supports having a pool I would definitely include the cost to maintain it and keep it operational as a part of the rent. It can be very expensive to get a pool back into shape after it's been neglected for a while. Periodic maintenance is the way to go on that. Also make sure the pool pump is wired to a timer not a switch that the tenants will have to turn on / off. You don't want them forgetting each night/day. 

There's always going to be a huge liability potential with a pool. Speak to an insurance co, and carry enough insurance. We put up a fence around our in-ground pool but that's a local requirement. 

Hey @Gary B. I am not familiar with CA law, but why do you have to keep her on payroll? Is that a law in CA? Me thinks that if she's not doing anything....she shouldn't be paid for anything! 

Here's some ideas off the top of my head: 
-Show vacant units (if allowed)

-Sweep/mop/vacuum common areas.
-Post any notifications to common area bulletin boards.

-Do any tasks that do not require a license (swap bulbs, key codes, that sort of thing)

-Clean any glass doors / windows in common areas. 

-Maintain a log of any service work being done

-Schedule routing service calls - servicing AC / Heaters as an example. 

-Create a positive morale in the building - decorate for the seasons. 

Congrats on the purchase @Andrew Bourquin! In addition to what Nathan mentioned, you should also ask the management companies you are considering what their rent collection rate has been through COVID. Depending on your market you will have an idea of just how much of a go getter this property management company is. You don't want to hire the property management company that says "it was about 50%" and then throws their arms up in that "such is life" attitude. 

@Remington Lyman is in Ohio. I have no idea if Canal Fulton is even remotely near where he is, but he does seem well connected and may be able to give you a recommendation. 

New England is the "bees knees" @Clayton Murray! Where else can you get what it offers? Coastline, 4 seasons, just the right amount of rain, mountains for days mmmmmmm *it just smells of freedom* (ok, I'm probably describing NH more than I am all of NE, but that's because of my admiration for the state, lol. 

CT native here, but if you're thinking of CT or NH, I vote NH all day long both for quality of life and tenant / landlord laws. New Hampshire still has Connecticut beat in that regard. BUT! Don't discount us! While our immediate neighbors (MA and NY) struggle to cashflow in their most populous areas, CT still holds it's own in the cashflow market. We do struggle on appreciation as a whole, but there are some submarkets that have done very well (think West Hartford).

House hacking is an excellent plan. Don't fall into the trap of thinking that you HAVE TO find a property that will cashflow with you living there. It's difficult, especially in this market. If you can break even, or even if you have to chip in a couple bucks a month, you will be years ahead of someone paying a full rent bill. 

Good luck! 

Yes, we have something like this as an online resource @Joe M.. Let me know if you can't find it and I can email it to you.  

It's against forum rules for me to link you to my website, unfortunately. 

Yes, absolutely @Account Closed. There isn't a specific license for mutli family.

Hi @Gregory Zakas, 

1. 12 month is fairly typical. 24 month sounds too long. 

2. Lease fee of 1 month's rent should only be paid for finding a tenant for a vacant unit, not on tenants already in place. That should be pretty clear and obvious. 

3. No, not to me. We don't do surcharges, but we also don't charge 6% as a PM Fee. It really depends on what they are charging as their base PM Fee. 

Hit me with more questions if you have 'em.