All Forum Posts by: Shane H.

I charge a $250 pet deposit and $25 "pet rent" per pet per month. If they have 2 pets then I'll do $400 and $40 and if it's more than that i usually find a more qualified applicant.

 Excellent point James! Though just like any rule of thumb, it isn't absolute. Which is why I say to consider selling. It makes for a great yard stick but only after crunching the numbers can you know for sure whether it's the right choice for your situation.

I always suggest looking at your properties from the perspective of "would I buy this property". For example, if you purchased a property for $120k, and it rents for $1500 and after expenses is cash flowing excellently then that's great. Then let's say fast forward and it's now worth $280k but rent has only gone up to $1600. Would you buy that property for the $280k that you could sell it for? If the answer is no, then you SHOULD look at selling. 

I'm not sure if i explained that correctly, so to summarize: If you would buy your property back for the price you could sell it for because it would be a good investment at that price, then you shouldn't sell. If you would pass on your property and wouldn't purchase it for whatever the market rate is then you should consider selling it.

Basically i'm suggesting analyze it as a potential deal to decide if the amount it is worth is better left in your portfolio or if it's better to sell and use that money to get a greater ROI on a different property.

@Joe Villeneuve I couldn't agree more, which is why i want to reduce my expenses as much as possible. However, if I have a loan at 5% but am making 10% on those borrowed dollars then i wouldn't want to pay that down. But if that same loan is at 20% and I'm still only making 10% on it then I want to pay that down. Even if my "tenant is paying that expense for me" because at the end of the day, i would increase my income by decreasing my expenses.

My point of difference is not comparing the two types of income, it's the fact that it's ALL income. And more importantly, I get to keep/use whatever income is left after expenses. Interest is an expense, regardless of how you allocate it or who you allocate it to. The tenants payment to me is not variable based on what interest I pay on any of my loans. So if i am paying a 20% interest on something, it doesn't mean i want to keep that loan just because my passive income is enough to cover it. It would be beneficial for me to pay off a 20% interest loan so that I do not have that expense and can therefore keep more income.

I understand your point, that if someone has a 5% fixed rate 30 year mortgage, then yes carry that full term and use your money elsewhere. But your argument behind that point is where I disagree as it becomes less and less true the higher the interest rate is on whatever loan you apply that argument to.

I'd have to disagree with you a bit on this Joe. If that's the case, then you could make the same argument about any debt... "it's not me paying the interest on my auto loan, my job is" or a business could make the same argument "it isn't my business paying our credit card interest, our customers are".

Tenants do not pay off our mortgages, we do. Once my tenants pay rent, that is my (my business's) money and then I will be using my (my business's) money to pay that interest. 

Not that i'm advocating one should pay off their low interest mortgage, i'm saying that interest rates DO matter and are very important regardless of whether cashflow is positive or not.

I've read similar posts on things like this such as if a landlord if responsible to fix the jets on a tub etc. And it seems the consensus from those is if you marketed/described the unit to have a functioning XYZ then it is your obligation to repair those "luxuries" when they fail.

That being said, i would definitely get a fence back up for the tenant. But i'd also try Thomas's suggestion and approach the neighbor about it. Offer to "chip in" since you receive benefit from it too. 

 You already have. "I do feel as though I don’t owe her 86.44 I overpaid my first month’s rent of 1300. If that’s the case, she owes me 13.56."

Are there any RE agents in the area that you could pay to do showings and find renters? They may also have leads on a good maintenance person.

@Nathan Gesner I have my first former tenant that I need to do this for. (mostly so they don't pull a fast one on a future landlord than anything else). Do i need to go through small claims to get the process started? Or do I start with finding a collection agency?