All Forum Posts by: Tracy Sharpe

Thanks. I am renting houses that are on different streets in a subdivision. I have a set of keys for each house with a lockable door. After a tenant leaves, I rotate a lock set from my inventory. So, after a tenant departs, a new lock set is always installed. The problem was that tenants would fail to return all their keys so I had to go to the store to get a new key made. We charge them for doing this. In any case, the lock set is always changed out. Thanks everyone for sharing your input. You have answered my main question. I should issue keys to each adult tenant listed on the lease.

Thanks for your input JD. Yes, it does make since to issue keys to each adult on the lease.

This is a general question to anyone who serves as a property manager of one property or an apartment complex. 

Do you generally provide your adult tenants with one set of keys and allow them to make copies themselves or do you make a set of keys for each adult tenant on the lease?

We have been making copies for each adult tenant on the lease, but we usually don't get all of our keys back from our tenants when they leave so we charge them to make new keys. 

Over the years, I have notice that there is a systemic problem for tenants not  returning all their keys. even though we tell them that we will charge them for  missing keys when they leave. 

So, we are considering adding a statement in our lease that we will charge our tenants not only for missing keys but also a service fee for us having to go out of our way to make new keys. Of course, the service fee and the key fee will come out of their security deposit.

How are you handling this situation? Issuing one set of keys or a set to each adult tenant, and do you charge a service fee for making new keys?

Your input regarding this matter is much appreciated.

I have recently discovered that there are many mentors and coaches available but it will cost you. I have found that coaching and mentorship have turned into a big business. As you know, time is money and there are so many people wanting to understand the wholesalling, rehabbing, and buy and hold strategy that it's costing the people with the experience a lot of time. As a result, there may as well charge for it. I have heard to have a coach it could start at $20,000. On the other hand, if you had a friend with experience willing to teach you, if you put in some sweat equity, you could learn by doing at no cost. These are just my observations. However, I would start by reading books and listening to podcasts.

Hello Steven, I know of a real estate attorney whom I met at a meetup. I will send her name to you through a private message.

Hello John, in our lease, if the tenant is moving out, we must inspect the property to see if the air conditioning works, if the light bulbs work, if the oven is working, dishwasher, etc. If they cut the electricity off before we do our inspection and I give them their full security deposit when they leave, there is no doubt that I will be out money. 

I learned that before any tenant leaves, we conduct a joint inspection. The goal is that their will be no surprises when we do send their security deposit back. Even though we itemize the items that need to be replaced or repaired, we do the inspection together. Same as coming into the property, we do an inspection to verify that everything is working. 

Regarding the LLC, I was once an insurance agent as well. I use to tell my clients that an umbrella will protect you, and it will but for liability issues slip and falls, etc. but not contractual issues regarding your business. Such as, you hire a contractor to do something and it causes injury or that you didn't do something in the contract that you missed. With an LLC, your risk is limited to the business LLC, although, anyone can sue you. However, by establishing an LLC, boundaries are placed on your assets with focus on the specific LLC in question whether the issues occurred.

An LLC protects the owner from liability caused by anyone participating in the business. Any liability damages awarded can only go after company assets, not your personal assets.

And your right, nothing will prevent anyone from suing you, whether you have an umbrella or an LLC but using them properly can limit your losses.

Thanks everyone for your input. I did speak to an attorney for advise at no charge. The attorney advised me to send a letter advising them that they broke the lease and we will even though the tenants called us to inform us that they will be breaking the lease. So at this point, the situation will be resolved once they hand over the keys. 

Many lessons learned for me. Even though I have a good lease based off the Texas laws, some of the points that you guys have made will be incorporated into all of my leases and emphasized to the tenant during our in brief. I will also let my attorney review the document. 

At this point, there are no issues although we still must meet with them. The house was clean when they left and all utilities were in their name. The entire issue circled around allowing the electricity, water to be cut off, grass not cut, and leaving the house without these services connected. Our lease states that the electricity, water, and lawn must be maintained. Until we lease the property, the money will come out of the money from the rent received for the year. 

I don't know if anyone has ever heard of a series LLC, it is used when you have more than one property. It allows separation without forming an LLC for each property. Your comments are welcome.

Update, the tenants called us last night. They stated that they will be returning the keys, pool key and garage remote. Additionally, they gave us verbal notice but will put it in writing that they will be breaking the lease. We informed them that there deposit will not be returned until after the 30 days as indicated by Sue and Greg. They also understand that they will pay up to the time the property is re-rented. Thanks everyone for your input.

Thanks Sue, yes, we have 30 days from the date the lease was broken to return the deposit minus any damages. We will do that according to Texas law. Additionally, once we have determined the date that the lease was broken, we will begin advertising to rent the property in order to mitigate further financial loss by the tenant. Once the property is rented, isince it was paid in full for 1 year, if there is any money remaining, that money will be given back to the tenant. Even though some people have made comments to keep the money, we will not do that because it would be a violation of Texas law. Our plan is to do what is right in accordance with our lease which is based on Texas law. Thanks for commenting on this post.

Thanks for your input. But it's not the just the security deposit that I am inquiring about, it's also the rent that was paid upfront. The tenant paid a full year of rent then left the property after 6 months into the lease without notice. Now, I have to repair damages, clean up the property, then find another tenant. I know that the security deposit would pay for that but say the cost is more than the security depost and it takes 3 months before I find a suitable tenant. In that case, I will use the prepaid rent to cover the monthly rent loss but once I have the property rented and say I have a balance of 3 months of rent left, does the remaining prepaid rent money go back to the tenant, if I find them? And If I don't find them, what must I do with the remaining money based on Texas law?