All Forum Posts by: Kaycee Miller

@Peter Sik your PM is probably using a property management software program to process this echeck. echeck's are essentially identical to ACH payments and are super secure. It's exactly what power companies use for an online bill pay system, student loan payments, and mortgage payments are done this way too. 

I doubt your PM would put his business at risk by using a system that doesn't protect his tenant's information and all the bank and accounting information he has on his end (to pay employees, disperse funds to owners, etc.) In most cases, for a pm to get set up as a merchant processor for managing rent payments, he has to get approved by a bank or merchant provider that ensures bank grade security by the software. He will also has to prove to be PCI compliant. If you still feel insecure, talk to your bank and ask them what kind of protection they provide you against theft via authorized payments.  You should be able to dispute an unauthorized payment, but it might take a little longer than doing a credit card charge back.

If you still don't feel comfortable with online rent payments, check with your state laws - in most states a landlord HAS to accept more than one form of payment, like cash or check on top of e-payments. (Unless a tenant has a history of late payments or bounced checks). Good luck! 

First off, you should absolutely get your new tenants to sign a lease agreement with you, especially for the month-to-month renters. 

I would ease the month to month tenants into a rent increase, as in, give them a 60-90 day notice that it is going up. 

For unit #2, let them know that due to inflation/taxes/etc., rent is going up to match market rate for the area.  You can either raise the rent by $100 (12%) at first. Or raise it by $50 this year, and another $50 next year to get it to the $875 target. The flaw in the latter plan is that you may need to raise it by more than $50 next year if market rental rates keep increasing. 

If the previous landlord didn't raise the rent on them, they must be expecting a rent increase. And if they can't afford the new rental rates, you are better off finding new qualified renters you meet your income requirements. 

After this, I would suggest building regular rent increases into your lease agreements. Keep them small at $10-$20 per year. A small increase like this wont scare away current tenants but will prevent you from having to do a $100 increase in 5 years, which could price a rental out of someone's budget.

As renter, I would give my landlord a bottle of wine or a gift card to a coffee shop along with a personalized card with every December rent check. As a real estate writer, I write articles about gifts for landlords and gifts landlords can give their renters during the holidays this time of year. It's a nice gesture to form a personal landlord-tenant relationship.  

However, this was the first year I did not personally send an extra gift to my landlord with my December rent check. Like @Thomas S. says, I think it is nice but it can cross the line of professional vs friendly when it comes to a business relationship - which all landlord-tenant relationships should be. 

You do not need to tell the tenant why you are stopping the application process like Greg says.  You can merely say the house is unavailable. Since you didn't collect an application or application fees, you are pretty safe.  However you should keep good notes in your own records just in case an applicant does bring up a case for fair housing. 

It sounds like you already have a written tenant screening criteria. You do not need to share all your qualifying criteria with your future applicants, you can keep these to yourself; as long as you use the same criteria every time you should be able to prove to a judge that you were following fair housing guidelines.  I see no problem in creating a checklist for a home visit as a pre-screening procedure before any prospect submits an application.  Does the home visit reveal excessive wear and tear? Yes =Fail. Does the home visit reveal animals present? Yes = Fail. Does the home visit reveal a well kept property? Yes =Pass ; tenant is invited to submit an application!  Seems pretty straightforward to me.

Look reviews of your management company on social media and online. Renters can be quick to complain about poor management and you will know if they have a reputation of ignoring calls or maintenance requests.

Tell your PM you would like to have quarterly inspections of the property, to ensure there isn't any damage that is going unreported by your renters or ignored by your PM.

Q3 - It makes sense for a good property manager to find you great rent paying tenants that stay put because that is easy money for them. They can essentially collect 10% of the rent and not have to do anything. 

IF they find bad tenants (per your scenario in Q3) they have to spend extra time and energy going through a legal eviction process for you. It is very time consuming and a cumbersum process to go through every part of the eviction- posting notices, contacting the tenant, filing legal docs, going to court, completing the move-out inspection, itemizing damage (this is why you pay them in the first place btw) However, even if they get 100% of a month's rent as a placement fee, I don't think any manager wants to go through that process every month. Then on top of that, they have to would have to spend more time finding a new tenant for their next payday. 

Rather than spend all that time processing evcitions and approving bad tenants just for the placement fee...they can spend that time growing their PM business and getting more clients and houses to place easy good renters that won't require any effort to manage.

I'd say give them a break, they need to start their rental history somewhere. Don't forget to do a criminal background check too though! If they have good credit, jobs and income and a positive criminal background you could be good. 

Just make sure to go over the lease with them in extra detail and have a print out with highlights for each of them and then one posted on the fridge. Be sure to emphasize the consequences if they break any property rules or lease terms. Make it easy for them to report maintenance issues (especially water damage!) but go over what constitutes an emergency and what is their renter-required maintenance. Do quarterly inspections to check in and catch any lease violations early so they don't go a whole year unnoticed. Emphasize that all these rules are so they get their full security deposit returned and so they don't even have an eviction their record. 

You should try and avoid getting mixed up in any roommate drama. That would lead to them constantly complaining to you and making you mediate for them every time a problem comes up. 

You should relate to all your renters that they should establish a roommate agreement (essentially a legal document/agreement) that would make a contract between the roommates about expectations to pay shared bills etc. That would keep you out of their drama. 

You can empower these college students to start handling their issues without an "adult's help" to bail them out. What happens when they buy a house and one of the neighbors doesn't pay the HOA dues--who do they run to then?

Good luck!

Renters who deal in cash are a big red flag for a lot of landlords. I would pass and keep looking. 

You should also consider WHY they would want to live this way. My guess is that someone in the household would not qualify for another rental, which is why they are willing to concede on space in order to stay at your property. The fact that they are willing to pay more money to stay at your place confirms that it's not about saving money, more about the fear of getting denied somewhere else. That being said, IF the new occupants would fail some other tenant screening requirements, do you really want them living in your property. It is bound to cause problems down the road. 

If you decide the extra rental income is worth it (and you check with occupancy laws), make sure to require the new adults submit an application that allows you to check their credit report, eviction history and criminal record. Also consider a higher deposit, 8 people (especially with kids) is going to put a lot of wear on your property.