Rental Property Management Software & Tools

Rental properties require a lot of work—from advertising vacancies to finding and screening tenants. And then there’s dealing with move-in, maintenance, and move-out cleaning. Whew! Property management entails all of the nitty-gritty details that give your rentals the best chance for success. Yes, it’s a lot of work, but it’s also a necessity.

That doesn’t mean you’re stuck doing everything by yourself. There are a few options for investors:

• Manage the properties yourself. This requires more hands-on work but ensures you’ll immediately know about any problems. If you’re the DIY type and prefer knowing exactly what’s happening with your investments, this might be the best choice.
• Hire a property management company. If you have a number of investments, this may be the best solution. A property management company can handle everything involved with renting your properties—-from screening tenants to processing move-outs.
• Use a property management tool. There are a number of property management services that can help you manage your investments for a small fee. Many can help landlords advertise, accept rent payments, and communicate with their tenants.

• Screening tenants This ensures landlords choose reliable, trustworthy tenants that will pay rent on time and not damage the property.
• Simplify rent collection. The easier it is for tenants to pay rent, the more likely they’ll do so. Requiring them to pay by check only during business hours on one day of the month is asking for trouble. Using online rent payment tools can make this process much easier.
• Respond to maintenance requests quickly. Small problems can turn disastrous quickly—and if your tenants did nothing to cause the issue, you’ll have no recourse from their security deposit.
• Implement a solid lease. BiggerPockets’ state-by-state lease agreements provide an excellent base to tailor your own custom leases. Make sure to cover all your bases so you can easily make a case in court if something goes wrong.
• Don’t abuse the security deposit. This deposit isn’t designed to pay for small repairs or changes after move-out. You should only deduct from the security deposit for problems your tenant specifically caused. Each state has unique security deposit laws—make sure to know yours.

There are a number of property management options. Smaller landlords with less than 10 properties will likely want to choose an inexpensive one that offers basic features, like advertising and rent payment processing. As your portfolio grows, you may want to consider upgrading. Full-featured property management suites offer accounting, tax assistance, communication abilities, and more—with a price to match.

Rental properties are long-term investments—but avoidable expenses caused by tenant damage can quickly turn an asset into a burden. Tenant screening is the best way to avoid costly surprises. By looking at a prospective tenant’s credit and rental history, you can determine if they’re likely to treat your property with respect.

There’s another benefit to tenant screening: Making sure your tenants can financially afford the rent. Their credit history contains key indicators—like patterns of late payments—that can let you know whether signing a lease with them might impact your monthly cash flow.

Typically, tenant screening services look at things like:

• Credit history: Does your potential tenant have a history of late payments? Do they have significant debt that could impact their ability to make timely payments?
• Eviction records: A history of evictions is a huge red flag. It could indicate your tenant treats properties or landlords disrespectfully, or tend to skip out on rent payments.
• Criminal records: While not all criminal records should disqualify a tenant—and it’s important to consider these on a case-by-case basis—serious felonies or assault charges can absolutely indicate a problematic potential tenant.
• Previous addresses: Is a tenant lying about where they lived? They might be hoping you won’t ask a previous landlord incriminating questions. Previous address records can indicate any discrepancies.

Most reports let you pick and choose which screening elements are most important to you.

A solid lease agreement should include things like:

• Tenancy terms. Are you going month-to-month or signing a year-long lease? Make sure it’s explicit—and spell out what happens when those terms end.
• Rent. Don’t forget to include what your tenants will owe monthly!
• Subleasing rules and requirements. Are you okay with your tenants subleasing? Even if you are, you’ll likely want to spell out what that entails.
• Security deposit. How much do you require? How will it be returned?
• Repair procedures. How quickly should tenants notify you when a repair is needed, and how soon will you fix the problem?
• Pets. Is Fluffy A-OK—or a no-go? Make sure it’s explicitly spelled out, along with any associated fees.