All Forum Posts by: Ralph S.

Boy, your broker has a pair, doesn't he? I think he's at much greater risk than you, and I'm surprised they would agree to this. Given your B in the A-B B-C, if the A selling agent is in your office, I think it's your broker who could be in the hot seat.

Not a lawyer, and don't know your state, but it seems like a Texas two-step around a net listing. The broker picks up 3 sides, maybe 4, with the "net" portion going to an agent of the broker (you). That could be trouble.

Hi Tom
Here's opinion #3. Get a thicker skin.

Your OP leaves me wondering what your role is in these two transactions. You state "I just received offers on two of my properties..." and then states "the listing agent is also in my office." So, are you the seller and not the listing agent? Are you buying SS and flipping them retail? It's not clear to me. And, you don't disclose what exactly these two are objecting to, or what they think you've done that is unethical or fraudulent. So, I'll take it for granted you've made all the disclosures, know the line you're walking as investor/agent and are in the right.

Anyway it shakes out, my advice is to simply thicken the skin, and walk the walk. Now that you're in this spot, and it seems that formal complaints have not been filed with the state or local association, do what you can to protect yourself and make this go away, watch your words and work closely with your broker. Surely your broker is involved, and he/she has been around the block.

Rich's words are wise regarding E&O and Liability. It would be a good idea for you to review yours. I don't think E&O will insure an agent/investor conducting transactions for themselves, only when acting as an agent for another, so make sure, even if you are 100% right and ethical, you are protected even against unjust claims.

On the hang-it-up or not question, if you are unhappy with the job, that would be a good reason to hang it up. If you let these two run you off, IMHO, that is not, by itself. But, the last straw is still just a straw like any other. Good luck.

If you're going to spring a claim of a environmental contamination on the seller, you're going to have to, IMHO, provide some sort of third party validation to support the claim. Saying hey, I found an oil spot and the neighbors say... isn't going to carry much weight.
If you do get (and maybe even pay for) and inspection and estimate to support your claim, then be prepared to remediate the problem as well, since the property is selling as-is.
The upside is an estimate will be worst case, and you might actually spend much less to dig up and replace the soil. The downside is that after paying for an inspection, it turns out to be nothing.

One Big A@@ Mistake America

All good stuff, so I'll throw in my two cents, having interviewed several and rejected every one.

It just seems like "Oh, you want a gun to shoot me with, AND you want me to load it before I give it to you." In every case, IMHO, a fee based schedule that rewards failure. Makes me want to ask, "should I just hold it to my head and pull the trigger, too?"

A couple of my favorites (I think some of these could have been candidates for the Guru Scam Words thread):

"Everybody charges for this, it's standard in this area...."

"We charge less than others."

"Since we work with so many investors, we really can't tailor our service offerings for each investor."

"Well, we don't like when an owner wants to do their own minor repairs, we find their work is often not up to our standards. That's why we prefer to use our hand selected handymen." Q: Are these handymen employees or contracted out? A: "Contracted."

Q: Explain how, when a call from a tenant comes in for a repair, how it is handled. A: "We send out a handyman who determines what is needed." Q: Who determines what really has to be done, checks the work being done, or checks to see if it is done at all, and that the charge is not inflated? A: "Oh, all of our handymen are hand selected and have worked for us for a long time. They've earned our trust."

"Our hourly handyman charge is $35/hour." Q: Does this hourly rate include running to the home center for a box of nails? A: "It could."

Q: Is your husband, by chance, one of your handymen? A: "he is."

"The owner provides a checking account, maintaining a minimum balance of $1,000, with our company as a signor on the account. You must agree that we can spend up to $650 per incident without notification."

Q: Your eviction fee of $600. (I knew a lawyer would cost $500 including court costs and total court costs amount to $140), is that with a lawyer or do you do it? A: "we do."

The Q that drew a deer-in-the-headlight stare every time: It seems that if I let you choose and place a tenant in my unit, that, according to your transaction based fee schedule, you would actually make a lot more profit, if that tenant you chose turns out a bad tenant, stops paying rent, trashes the place and has to be evicted. Is that right?

And, my all time favorite, when talking to a prospective PM about a 3/2 SFR that had just gone through a $40K full gut renovation, "oh, we could get a Section 8 tenant in this right away." :shoot:

Sorry. All those questions posted before me are good questions. But, if a PM is ever going to get my business, they are going to have to show me that because they are professional and do this full time for a living, that they can do a better job, at less cost, than I can do myself. In essence, chosing a PM is the right financial decision and not a great big hairy risk and surrender of control. That they can locate, and retain, better tenants than I can. That the average length of stay is longer, that vacancy between tenants is shorter, and the tenants are lower maintance. That they can provide adequate assurance that they can control costs and aren't taking me for a ride.

Guess I'll never use a PM.

It was on Nightly News, too. Along with covering the rage of those ranting that it bails out individual irresponsibility with tax dollars.

Said it was in response to the failed $XXX billion plan that has only helped 200K homeowners restructure, and it failed to say how much the bank incentives would offset the principal reduction.

More fuel on the fire.

Confirming a business transaction is different than a written, properly executed contract. I think you'll find that email is missing one very important element of contract law, a proper signature. There are some methods, in some states, that will allow for an e-signature process, but they don't, to my knowledge, include email.

If he is converting a SFR into a Duplex, I would imagine the permit to do so must be posted at the site. Check the windows as (in my experience) the permit needs to be in a location that is visible from the outside. It would likely also require electrical, plumbing and HVAC permits.

If your municipalities Neighborhood Services Department (whatever the permit issuing/inspecting department is named) is available via website, check to see if issued permits are available there, in some larger cities they are.

If your assessor (city or county) has property data available on the internet, you could look up the address and see what the current zoning is. It will tell whether it is currently SFR or two family.

Then there is the visit to the department, or an anonymous phone call questioning whether the work at this address is permitted. That would spark an investigation while keeping your name out of it.

Originally posted by Ryan A.:

You said they do not get their security back if they leave. For what reasons?
......
I have a clause in my lease that says "The security deposit is not a payment of rent and may not be applied toward any rent or fees." Which protects me from tenants trashing the place then skipping on the last month of rent.

But because of that clause I won't be able to keep the security to cover missed rent.
..........
I'm thinking of adding a similar clause if RI allows it.

Ryan
Most states understand when a MTM tenant doesn't give a 30 day notice, or when a lease is broken, that this "breach of contract" or possibly even a violation of state statutes, causes financial harm to the landlord in the form of increased costs and lost rent. LL/Tenant laws protect both LL and tenant, and tend to spell out what is required, is not required or is/is not allowed. There are forbidden clauses that could render your agreement null, there could be, as in Wisconsin, standard clauses, non-standard clauses, and forbidden clauses. You may or may not be able to state in your lease that the tenant must pay for professional carpet cleaning (WI forbids it), but still, I can charge and deduct for Stanley Steamer when the time comes.

In the case of breaking a lease with a very short notice, the tenants, by defaulting, are forcing Rodney to spend time and money advertising and showing, in addition to experiencing a vacancy (lost rent). That is Rodney's cost because they defaulted, not he, on their agreement. It's enough to make you scream, "there ought to be a law against that!" I think you'll find there is, and Rodney is entitled to compensation for his losses caused by the tenants, and you are, too.

Even if you have the "Deposit shall not be applied against rent" clause in your lease, I think you'll find the State law will still allow you to apply any remaining deposit, after subracting for damages, unpaid rents or other charges and fees owed. The "not be applied" clause, as you correctly stated, is meant to prevent the tenant from pulling the "Take the last month's rent out of the deposit" schtic, and you'll likely find that is one of those things already forbidden by state law, unless "agreed upon by both parties." You might also insert the word, "Tenant" in front, just to be clear, but I don't include it in my lease because it is already state law.

It really can't be understated: Know your state's LL/Tenant laws. Know your lease protects you, too, and is not contradicting state law. Know your rights and what you are entitled to, and the rights of tenants. Every time I hear someone say "I gotta see if my state..." or "if RI allows it," or (I think) your misconception about the "not be applied" clause, I cringe. You gotta know this stuff for your own protection. Not knowing will cost you money, even if you don't know it is.

I had already evicted several tenants before finding out that for the unpaid rent from the end of the 5 day notice until the day they were actually evicted, I was entitled to double the rent amount, all I had to do was ask for it, and I didn't know to ask. While a judgement rarely gets paid anyway, I have used that rule, along with the 30-day rule (a 30 day notice is required by law, therefore the LL is entitled to 30 days rent from the time written notice is given, regardless of when the tenant actually moves) to deduct from the deposit.

The Wisconsin Dept of Agriculture, Trade and Consumer Protection published a book of about 100 pages, "The Wisconsin Way; a Guide for Landlords and Tenants." A pdf is found at:

http://datcp.state.wi.us/cp/consumerinfo/cp/factsheets/pdf/cp-127web.pdf

It contains not only the legal-speak state statutes, but the plain english explainations of who can, who can't, penalties and entitlements. I urge everyone to seek something similar for their state, and don't be afraid of talking with a lawyer.

Why even bring up the subject at this point in time? I know, you're a bored, filthy rich landlord needing a little drama in your life! :lol:

Normally, and I would assume this applies in NC, the LL has a certain amount of time after a tenant moves out to determine charges, if any, to apply against the deposit. After tenant damages are addressed, any remainder can be applied to lost rent due to breaking the lease, lack of notice, etc. This is an activity that happens after they move out, not when notice is received.

My suggestion is to let that sleeping dog lie. Let them get the bad news after they are gone and can no longer do any damage. When you send the letter explaining why you're not refunding any of their deposit, make sure your letter is supported by your lease, their notice and NC law. By bringing this to their attention now, they're going to want to argue, and realize there is no reason what-so-ever to leave the place clean and may even do damage as their going away present to you. What fun.

As long as they are in the apartment, my response is always "your deposit will be returned in accordance with the lease agreement and state landlord laws regarding the return of a deposit. Until you move, we won't know. I suggest you leave the place as clean as possible and damage free to ensure you get every dollar back you're entitled to."

They've already decided to move and holding the deposit over their head is not going to get them to stay. That they haven't given a 30 day notice, or made the notice in writing, you still haven't adressed. My response to their verbal and very short notice would be to keep mum on the deposit, and simply ask that they put their notice in writting (usually a requirement, anyway), signed by all the tenants and giving the date they will be out (protects you), then let them know you want to start showing the apartment before they move, with proper notice, and ask them to make sure the apartment is clean, and that they not be there for the showings. It avoids the deposit issue, protects you, shows you are working with the situation and hopefully, they will keep the place clean and it will be clean and in good shape when they leave.

And, know your local laws. Deposit return laws are different in different states. You should be able to find the requirements of returning a deposit in NC by doing an internet search.