All Forum Posts by: Laura Kayes

Hi Syed,

Security deposit laws vary by state so check the laws first. In most states, if the tenant does not pay the rent, the landlord can use the deposit to cover the unpaid rent. If the deposit doesn't cover all of the rent due and owing, then the landlord can sue the tenant for the rent still owed. If that is the case in your state, then yes you'd keep the $6k security deposit as rent owed and invoice the tenant for the remaining. 

-LK

Hi @Jim Bryant,

Eviction laws and time frames vary based on the state you're in, however in most states the first step in the eviction process is the notice to vacate letter due to non-payment of rent. Once this letter is served, there is a time frame before an eviction can be filed in the courts (some states it is 3 days, some it is 5 ect.) If the tenants moved out before an eviction was filed in the court, then you cannot file a formal eviction, but you can sue them for damages and keep their security deposit. 

-LK

Hi @Spencer Dillinger,

It really depends how hands on you are wanting to be. Typical management fees are 6-10% of the gross monthly income, as well as a fee for releasing the units (up to a month of the first month's rent). A good property manager can bring tremendous value, but a bad one can cause a financial disaster. This is the same for self-managing your properties. 

If you decide to self manage, I'd highly suggest hiring an agent from a PM firm to initially lease the properties for you, and then you takeover after. 

-LK

Hi @Sean Ade,

Pros are guaranteed monthly rent. This is a great way to go if you have properties in lower income areas with the majority of your prospective tenants not able to qualify based on income requirements. HOWEVER, make sure to still properly screen these tenants as they could be higher risk for property destruction ect. 

-LK

Hi @Caleb Clay,

Make sure you background and credit check the tenants. Do not take anything to be credible just from word of mouth. If it is verified that their credit is mainly wrecked by medical bills then yes I'd consider them as long as they meet your other criteria for tenants like verifiable income, good rental history, clean backgrounds ect. Medical bills are an area I usually do not take into consideration as I know first hand how financially wrecking they can be. 

As far as security deposits, the laws vary by state. Here in Texas there are now laws that limit how much a landlord can charge, so often charging 2x rent as a deposit for a higher risk tenant is used to offset that risk. A quick search on google and I found that Alabama does have a limit for a deposit as copied and pasted below: 

-LK

Hi @Diana Johnson,

I would ONLY consider this if the property is in a low-income, high crime area with low rental rates. Not every property is going to be able to have the same standards. For example a property in a rougher area of town that rents for $600/month versus a SF home in a quiet suburban neighborhood that rents for $1450/month. 

If your property is the latter, then PASS. 4 charges in 10 years is really not a good sign, and no conviction really doesn't matter. She sounds like she may be a good manipulative liar. Property destruction and a charge from 1 year ago are huge red flags. 

-LK

Hi @Bryson Cox,

PM fees vary based on property, location ect. but typically range between 6-10% with most being closer to 10%. It is also pretty standard to charge one month's rent when finding a NEW tenant as two brokerages typically are being paid out, but there should be a flat-fee rate when it is just a lease renewal. 

However, I'd be really concerned with the vacancy rates of your units, and the PM company should be as well. I find that more times than not, when a property is remaining vacant that is habitable and priced correctly, the broker is the problem. Try calling as a prospective tenant and see how they handle the leasing process. This may give you some insight as to how to proceed with the company, and possibly find another manager. 

-LK

Hi @Val J.,

Give the tenants 30 day notice to move out per the M2M lease and continue with the eviction process if rent is still not paid. The eviction process in Texas once filed in the courts takes 21 business days. 

Most buyers will be inclined to take cash offers... however, it does depend on the deal. To be honest, I wouldn’t think offering these two options would set you up for success. My opinion and experience is that one offer is sufficient with counters if needed. Adding more to the table can often set you up for less offers. 

Hi @David Kirkland, I am copying and pasting below a list I made on another post :) 

In regards to fees:

1) What are your monthly management fees?

2) Do you collect management fees when a unit is vacant?

3) Are there miscellaneous fees that I should expect to incur?

4) What is the escrow reserve amount?

5) What is your re-leasing fee?

6) What do you charge for lease renewals?

7) Do you up-charge for repairs?

8) Are there any start-up fees?

9) What is your repair allowance?

10) Are there cancellation fees if I am unhappy with service?

11) Who keeps the late fees?

For Leasing:

1) What is your procedure for qualifying tenants?

2) What is your average days on market?

3) What leasing agreement do you utilize?

4) What strategies do you use to fill vacant units quickly?

5) How do you set your rental rates?

6) Who can show the properties? (Do they utilize self-showing, lockboxes, supra keys ect.)

7) Do you have any tenant guarantee for tenants you place in the property?

8) How do you handle evictions? What is your eviction rate?

9) Are tenants required to maintain renters insurance?

10) How long are your leasing agreements?

In regards to maintaining your property:

1) Do you have an in-house maintenance team?

2) Do you have a relationship with vendors in this area?

3) How many properties do you currently manage?

4) Will you visit the property regularly? (Try & find a company that does quarterly inspections)

5) What is your procedure if a tenant is violating their lease agreement? (trashing the property, not changing air filters, overlooking repairs, unauthorized pets)

6) What is your process for handling service requests?

7) How often will you provide me updates about my property?

Other questions:

1) Do you have one property manager I will communicate with? If not, how do you handle communication with owners?

2) Are you a licensed property manager?

3) What types of properties do you manage/how many properties/ what areas?

4) How do you send reports? Is there an online interface for tenants/owners?

5) How often am I updated on the property accounting?

6) How is rent collected?

7) How long is the management agreement for?

8) Do you have references?

9) Do I have to sell my property with you if I list it for sale?

10) Can you provide copies of your contracts?

Good luck! :)