All Forum Posts by: Paul Ronto

Check out lawdepot.com , they have a ton of free forms including leases. 

@Matthew Porcaro there are many ways to take payment, cash, check, money order, ACH, credit card, wire transfer so you just need to understand the pros and cons or each so you can make the best choice for you. 

Cash: Cash may seem great, it's real and doesn't bounce, however, it usually means you have to meet your renter in person to collect which can be a pain and it's hard to keep track of. You need a system that you manually enter amounts and dates and it's easily lost without any way to recover those funds. I would warn against cash. 

Personal Check: This is the number one way tenants pay rent. It's easy for renters and landlords. They can be mailed and deposited from afar. The downside is bounced checks which cost you, the landlord, extra money and time to deal with. They can be canceled by the tenant at any point as well.

Money Orders/Cashiers Check: These are considered safer than personal checks because you need to use verified funds to purchase them, however, although it's harder they can still be canceled before you deposit them and they are a burden for the tenant to get and for you to electronically deposit through most bank apps, which means you have to take a trip to the bank. 

ACH: This is a direct deposit from tenant to a landlords banking account, is usually free to both parties but can take 4-7 days to process. It's easy but not quick. 

Credit Card: Easy for everyone usually involved but there tend to be steep charges to the person collecting, typically 2-4% of the total amount, so on a 2K rent, you could be paying out 80$ just to accept payment. Also, Credit cards are easy to reverse the charges on up to 120-180 down the road. So although you get payment today, if your tenant decides to charge back 6 months down the road because they are unhappy with you about something they can, and most large CC companies like Visa protect the end user over the person collecting the payment.

Wire Transfer: These are bank to bank transfers and are usually the safest way to transfer money, they are fast, almost immediately in most cases and cannot be easily reversed. However, they tend to cost 20-30$ per transfer.

Anyway, there's the quick rundown on a few of the most common payment methods. Our suggestion is to find an online payment system that helps you navigate these and track them in one place. I would urge you not to share your personal bank information with a tenant like an account and routing number as mentioned above, some online payment systems out there let you sign up and submit all your bank info, and then invite tenants to pay. They are connected to your account but never actually see or have access to your sensitive banking info.

Hope this helps! Feel free to reach out directly if you have any other questions about collecting rent payments. 

I agree with both the comments above. Pros are you are cash flowing from the day you close, no stress about finding new tenants ASAP which may make you cut corners on screening just to get someone in there that first month before the mortgage payment is due. The cons are obvious, you didn't vet the tenants, they could be terrible. The last owner may have gotten them in there just to cover costs but didn't do any deep screening. 

If they are bad, you can always ask if them if they want out of the lease early and if it's mutual you can terminate the lease together, this is unlikely, but maybe not, you never know what tenants need until you ask. You could also ask them if they would agree to terminate the old lease to move to a new lease that you create, they may agree since a change in ownership can bring about changes like these, can't hurt to ask... 

I'd say, review the current lease, have a lawyer review it as well. Have a new lease ready if you want to keep them, and have them use the new lease once the old lease is over if nothing else. Make sure you have good documentation on property condition before they moved in, and on their security deposit so you have recourse should they destroy the place by the time they move out. 

Good luck, hope it works out. We've bought places with renters in them and it's been fine, but I could see it going the other way too. 

There are a ton of great software choices out there today, the main concern is finding one that has the features you need and the price point that makes sense for your rental business. Landlording can be hard, but with the right tools it becomes more and more profitable and easier to manage as a side project. 

Welcome to the land of landlording by the way! You're in the right place so if you have questions feel free to post or reach out through direct message. 

If you're looking for an easy way to whittle down the number of tenants who apply to a bucket of people that you'd actually rent to, I would require them all to apply online, and pull credit, criminal and eviction reports. From there, you'll have a handful of names you can further investigate through reference calls to past landlords and current employers. 

I'm sure this sounds like a broken record but a better tenant is worth way more than a few more bucks a month. Good luck!

I second @G. Brian Davis in saying congrats! Landlording is an exciting adventure that has a ton of upsides if done correctly. Make sure you find good forums to use, and I'd advise having a lawyer look everything over so you're sure you have everything covered. 

Be sure to look up any state, county and city-specific laws that you will need to follow or add to your form collection. A lot of places have occupancy limits for example, with steep fines should you not comply. You local city site should have info or even a whole department that can usually answer you questions. 

The biggest advice a seasoned landlord will give you is to make sure you set up your renter criteria and stick to it, and be sure not to take shortcuts on tenant screening. Bad tenants will cost you in more ways than you'd imagine. Good tenants make being a landlord fun and easy though, so be sure to ask all the appropriate questions during screening, call references like past landlords, current employees and always pull credit, criminal and eviction reports. 

Feel free to reach out directly if more questions pop up as you start looking for tenants and good luck, you're making a great financial decision in owning rental property!

I live in a college town and rent almost exclusively to students, and have been for 10 years now. I require a co-signer for any of them that don't meet my income requirements. I agree with some of the comments above, that if they have good or no credit than I am willing to keep them as an option, but bad credit or evictions are a red flag for me obviously. 

This comes down to your judgment as well, does their job seem temporary like possibly a serving job, or are they getting a stipend from the university? I rent to a lot of grad students who get a stipend for teaching from the school which is pretty solid until they graduate. In theory, they could drop out and lose their income, but anyone can lose their income, student or not. 

Most students and parents are understanding of the need for a co-signer, so I typically get one co-signer for each tenant, and I make the tenant and their co-signer both submit applications which pull credit, background and eviction reports. 

It's always better to be safe than sorry. If you are getting desperate to rent a property, my solution is to lower the price a touch before I start dropping my screening processes. I'd rather have a good tenant paying less than a bad tenant paying more. 

I agree with @Anthony Hurlburt , I would tread carefully here as it could be twisted to appear as an unfair practice by Fair Housing laws. You're safer bet is to go with household total income as a 3x of the rent, which can include income producing people on the lease but not add additional provisions for non-income producing occupants. 

There are really two ways to look at this. On the one hand, doing in-depth screening before you even show the property saves you a lot of time by weeding out people that don't meet your criteria. On the other hand, you will scare off some prospective tenants if you make them apply before they even get to see the property. 

I think the best solution, as stated in some other responses is to thoroughly pre-screen people over the phone, here's a simple list of 7 questions that will get you headed down the right path. 

1. Is this rental for you or someone else?

2. Why are you moving?

3. What is your planned move-in date?

4. How many people do you plan on living with?

5. What’s your current monthly income?

6. Can you provide employer and landlord references?

7. Are you willing to submit a credit and background check?

If you make it through those I would say, time for a showing. If you wanted to go a step further, you could do credit and background checks after this call, before screening but this still may scare some potentials away if there's a lot of competition out there that are willing to do showings pre screening. 

Feel free to DM me if you want to chat a little more about this, I have a few good resources I could dig up and share with you on tenant screening that may make this all a little easier for you to find good tenants for your properties. 

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