All Forum Posts by: Nathan Gesner

I think the entire state of Illinois is considered more Landlord friendly. Chicago is very tenant-friendly.

Eat the cost. You can try asking the Seller to pay you the remainder but they are under no obligation and probably won't even bother responding.

Your offer to purchase should include a requirement that they provide all documentation and agree to sign an estoppel certificate (also called estoppel form or agreement). The estoppel certificate is a form filled out by the tenant and then confirmed by the Landlord. It's supposed to ensure there are no surprises after closing. For example, you buy the place and the tenant could claim the Seller allowed them to paint the walls black or that their security deposit was twice what the Seller claimed. How will you know? An estoppel certificate fixes this problem.

Some things it may include:

1. Tenant name, contact information, and address

2. Occupancy date

3. Is there a written lease? If so, review it to ensure it matches the estoppel certificate

4. Are there any modifications to the written lease?

5. Are there any verbal agreements or arrangements between the current Landlord and Tenant?

6. Current lease term (expiration date, month-to-month)

7. Current rent rate

8. Rent due date

9. Security deposit amount

You can find plenty of examples by searching for "tenant estoppel certificate doc" or exchange "doc" with "pdf" for more options.

Here is an example and explanation: https://eforms.com/rental/estoppel-certificate/

Some have a lot of legal jargon but this document does not need to be so detailed. This is an important tool for anyone buying a tenant-occupied property.

I believe in honesty but you don't have to be detailed about it.

"Due to some lease violations in the past year, we've decided not to renew your lease and expect you to vacate no later than November 15, 2018."

Yes, they may return the home damaged and dirty. But they would probably do worse if you left them there. Get them out, use the deposit, and find better tenants next time.

It could be you listed it too low. It could be the way you've advertised it and you're just getting a bunch of lookers that aren't seriously interested. When I first started managing rentals, I would get 10-15 calls in the first couple of days. Once I announced that I would require an application fee and run credit/criminal background checks, the calls dropped to a few a week.

You should inspect the lease as part of your inspection phase, long before closing. If the Seller tells you the units are all renting for $1,000 a month, you need to verify that. If the Seller says the tenant put down a $2,000 deposit or that they don't have animals or that they pay rent on time every month, or that they've lived there for 16 years, you should verify all of that so you know exactly what you are getting.

As mentioned, you can do this with an estoppel certificate or estoppel letter, a review of the lease agreements, and a detailed inspection of every unit. The estoppel certificate is a form filled out by the tenant and then confirmed by the Landlord. It's supposed to ensure there are no surprises after closing. For example, you buy the place and the tenant could claim the Seller allowed them to paint the walls black or that their security deposit was twice what the Seller claimed. How will you know? An estoppel certificate fixes this problem.

Some things it may include:

1. Tenant name, contact information, and address

2. Occupancy date

3. Is there a written lease? If so, review it to ensure it matches the estoppel certificate

4. Are there any modifications to the written lease?

5. Are there any verbal agreements or arrangements between the current Landlord and Tenant?

6. Current lease term (expiration date, month-to-month)

7. Current rent rate

8. Rent due date

9. Security deposit amount

You can find plenty of examples by searching for "tenant estoppel certificate doc" or exchange "doc" with "pdf" for more options.

Here is an example and explanation: https://eforms.com/rental/estoppel-certificate/

Some have a lot of legal jargon but this document does not need to be so detailed. This is an important tool for anyone buying a tenant-occupied property.

You should sell. If you hold on to it, you will lose $850 every month it is occupied. You will lose more when it's vacant and you have to cover utilities, particularly in a colder climate. This means you'll probably lose at least $10,000 a year.

You don't say how much equity you have in the home but I would seriously consider selling it, even if you have to take a loss. If you put 3% down and you've owned it for a few years, you should be able to keep the losses to a minimum. It's probably much cheaper to sell than to hold onto it and potentially lose far more.

Does zoning permit a commercial business?

Does your kitchen meet commercial requirements?

How are they qualifying for Section 8 while running a business?

I would deny them and I would also report them to HUD, particularly if you have this in writing.

I don't know any personally but you can start by going to www.narpm.org and search their directory of managers. These are professionals with additional training and a stricter code of ethics. It's no guarantee but it's a good place to start.

1. Ask how many units they manage and how much experience they have. If it's a larger organization, feel free to inquire about their different staff qualifications.

2. Review their management agreement. Make sure it explicitly explains the process for termination if you are unhappy with their services, but especially if they violate the terms of your agreement.

3. Understand the fees involved and calculate the total cost for an entire year of management so you can compare the different managers. It may sound nice to pay a 5% management fee but the extra fees can add up to be more than the other company that charges 10% with no add-on fees. Fees should be clearly stated, easy to understand, and justifiable. If you ask the manager to justify a fee and he starts hemming and hawing, move on or require them to remove the fee. Don't be afraid to negotiate!

4. Review their lease agreement and addendums. Think of all the things that could go wrong and see if the lease addresses them: unauthorized pets or tenants, early termination, security deposit, lease violations, late rent, eviction, lawn maintenance, parking, etc.

5. Don't just read the lease! Ask the manager to explain their process for dealing with maintenance or problem tenants. If they are professional, they can explain this quickly and easily. If they are VERY professional, they will have their processes in writing as verification that it is enforced equally and fairly by their entire staff.

6. Ask to speak with some of their current owners and current/former tenants. You can also check their reviews online at Google, Facebook, or Yelp. Just remember: most negative reviews are written by problematic tenants. The fact they are complaining online might be an indication the property manager dealt with them properly so be sure to ask the manager for their side of the story.

I hope this basic guide helps. If you have specific questions about property management, I'll be happy to help!

Big red flag.

I run a background check for a variety of reasons but one of them is criminal history. I run it on everyone. It's very common to have a squeeky clean woman dating a "bad boy" with terrible credit and criminal history. I had one woman apply to rent from me and then learned her boyfriend just got out of prison for sexual assault.

it doesn't matter who is footing the bill. Check every person, every time.

As soon as I saw your headline, I knew it was a tenant leaving early. In my experience, tenants terminate early about 80% of the time on leases longer than 12 months. I can't explain why.

I only allow one-year leases and I include a termination clause that requires them to give 30 days notice in writing and pay a penalty for terminating early. If they meet my requirements, they walk away free-and-clear, get a good Landlord reference, etc. This is a money-maker about 90% of the time. The remaining 10% opt to take their chances and continue paying rent while looking for a replacement tenant. We almost always get a new lease before they leave or shortly thereafter, so the tenant doesn't pay much out of pocket.

The last tenant to move out and cause a loss was almost two years ago. I attribute a lot of this to proper screening and a higher-quality tenant.