Posted by Teresa on August 9, 2010 under Landlord and Tenant FAQs, Rents and Deposits | 
When a tenant informs you that they will not be renewing their lease, provide them with move-out instructions. Written notice of your expectations is always a good idea when it comes to dealing with tenants.
What Should Move Out Instructions Cover?
- The first item should be that a written move-out notice is required from the tenant. This helps clear up any possibility of confusion over dates and terms of the move-out.
- Ask the tenant to provide an address to which you can return the security deposit, after deducting legitimate expenses for repairs or cleaning.
- Inform the tenant you will be contacting them to conduct the move-out inspection. Let them know this is not optional: you will need the tenant to be present to initial and sign the inspection list.
- Let the tenants know that according to the terms of the lease, the unit must be returned to the same condition it was in when they moved it. If they’ve painted a different color on the walls, they need to repaint it. If they don’t clean the unit thoroughly, you can hire cleaners and deduct the fee from the tenant’s security deposit. Any damage repair costs will also be deducted from the deposit.
- If there is a fireplace in the unit, let tenants know they must have it professionally cleaned before moving.
- Tenants might not know that the last day of the lease is the day they must be out. Inform them that any extra days will be charged a prorated amount of their monthly rent. To calculate daily rent, divide the total rent by 30.
- Ask the tenant to set the thermostat at whatever temperature you prefer.
- Utilities need to be transferred to you or turned off, according to what works for you. If ther is another tenant lined up, then obviously you don’t need to turn them off. Let the tenant know to inform the utility companies, including gas, electric, cable, water and sewer, of the last day they will be in the space. Warn them not to have the utilities transferred or turned off until the end of the last day of their lease.
- Let the tenant know where to leave any extra trash and where to drop off the keys.
One thing landlords can count on is that eventually, all of their tenants will move out. Whether it’s a good thing or bad, it can be a smooth process when you’re organized and approach each move-out the same way.
Posted by Teresa on August 4, 2010 under Landlord Tips, Landlord and Tenant FAQs |
When rental units sit empty and you’re starting to feel desperate, it can be tempting to lower your standards and sign a lease with the first tenant who shows you the money. Experienced landlords might remember doing just that—and living to regret it.
Rather than leasing to a tenant who doesn’t meet your qualifications, try to figure out why your units aren’t renting. Fix those issues and you might find the right tenant will come along sooner than you think!
10 Possible Reasons Your Rental Units are Vacant
1. The rent is too high. Check the market. Do your homework. In most markets, tenants have lots of choices. Reducing your rent is better than collecting zero rent.
2. The condition of the rental is not acceptable to good tenants. Does it look pristine or shabby? Are the railings solid or wobbly? Does the property need a coat of paint? New lighting fixtures? Ask yourself if you’d pay your rent to live there.
3. You are letting good tenants walk away. If you have a qualified applicant, don’t let them get away! Close the sale.
4. You’re not marketing the property enough. Expand your reach. Create appealing ads with great descriptions and get them out there. Put signs on the property (make sure they’re in good shape). Put arrow signs on the corners if it’s allowed.
5. The right tenants aren’t seeing your ads. Who is your ideal tenant? Where do they hang out? Whether it’s the laundromat down the street, a nearby coffee shop or Craigslist, put your ads where your best tenants will actually see them.
6. You’re not making it easy for potential tenants to reach you. Do you have a website, email and cell phone? Does your phone plan have texting? A lot of young people use texting over talking, and Gen Xers and Baby Boomers are more likely to email.
7. Your building or property manager has a bad reputation. If your current tenants are not happy with either, they are probably telling others. Ask them.
8. Your competition is giving tenants a better deal. Are there “free rent” signs on nearby properties? Find out what your competition is doing and match or beat them.
9. Your property management company (is it you?) is not doing its job. Take a hard look at how successful the rental management has been. Too many vacancies are not acceptable. And is you decide to replace them, make sure you put up “under new management” signs on your property!
10. The property looks unsafe. Visit your properties at night. How is the lighting? Are there people hanging around? Do shrubs and trees cover the windows? Fix these problems for your current tenants and potential tenants will feel safer, too.
If none of these factors apply, then you need to do some investigative work. Potential tenants won’t tell you why they decided not to sign your lease—they just go away. Follow up with the next interested, qualified tenant who disappears. Find out why they don’t want to live in your rental property. Poll your current tenants to find out what they like and dislike about living there. You need to know what’s wrong before you can fix it!
Posted by Teresa on July 2, 2010 under Landlord and Tenant FAQs |
Margaret is a landlord who’s trying to do her best to make all of her tenants happy—in hopes that they’ll renew their leases and save her the time and effort of finding new tenants. But she’s discovering that keeping one group of tenants happy could be putting her in legal hot water.
Here’s what happened: Margaret owns a four-plex rental property, with a shared carport, individual patios, and a common back yard. There are no fences or dividers, and each tenant uses the back yard as they please. Two of her tenants have children, and two do not. All are on one-year leases.
The basic lease that all four tenants signed stipulates that children are allowed to play in the front and back yard areas of the building, and on sidewalks that lead up to the unit they live in. They are not to play in the carport.
Stacy is one of the tenants without children. She complained to Margaret that her neighbors’ kids were playing too close to her patio, and too loudly. She threatened to move at the end of her lease, which was coming up in 60 days. Stacy is an ideal tenant—never late with her rent, respecting Margaret’s time and appreciative of her efforts to keep the rental unit well-maintained. She rarely complained about anything.
Margaret wanted to appease Stacy. Besides, she agreed with her that it was unfair for the neighbors’ kids to play near her patio, disturbing Stacy’s peace and quiet. So Margaret sent letters to the two tenants with children, informing them that effective immediately, the children’s play area would be limited to their own front sidewalks and patios.
The result? The parents responded negatively, and threatened legal action against Margaret. And they had a legitimate point—their leases, clearly stipulating where the children could play, were still in place. Additionally, the lease only mentioned quiet hours from 10:00 p.m. to 7:00 a.m. So, Stacy’s noise complaint had no basis.
All of Margaret’s tenants signed the same lease. If Stacy had an issue with the rules about where kids could play, she should have dealt with it before she signed the lease. And if Margaret wants to change the rules for her long-term lease tenants, she can only do so at lease renewal time.
Landlords are also obligated to comply with the Fair Housing Act, which forbids discrimination against tenants due to familial status. So her rule about where children can and cannot play should apply to all tenants, not just children—just to be safe.
Posted by Teresa on June 4, 2010 under Landlord Tenant Lawsuits, Landlord Tips, Landlord and Tenant FAQs |
Take a look at these true landlord stories—and avoid repeating their mistakes. These are definite landlord don’ts!
- George informed his landlord that he lost his job and can’t afford the apartment any longer, so he needed to break the lease and move. The landlord told George he’d be responsible for the rest of the rent until the lease is up— unless he’s able to rent the apartment first. George knows the landlord is having a hard time filling vacancies, so he was surprised to see the apartment on Craigslist for $500 more per month than George was paying. George knows the landlord will never rent it at that rate. He thinks the landlord is deliberately avoiding re-leasing the apartment.
Don’t be unreasonable—if you’re a landlord who is not trying to find a replacement tenant, or rejects a qualified tenant, your current tenant could have a case against you. If rents are declining, advertising a higher rent is not going to look legitimate. George knows the market. Your tenants probably do, too.
- Carrie was informed by her landlord that she’d be responsible for the cost of refinishing the hardwood floors after she moved out. Carrie didn’t think it was fair, because the floors were nearly a hundred years old, and she didn’t damage them beyond a few scratches. She thought her landlord was trying to bully Carrie into financing her new floors. Her suspicions were confirmed when she did some online sleuthing and saw that her landlord had a Twitter account—and found her tweet saying, “thanks to my tenant for beautiful new floors!”
Don’t repeat any tenant business online. If they don’t see it, their friends will. Word travels fast online!
- Sharon and Joe applied to rent an apartment. The property manager informed Sharon that because they are unmarried, each of their incomes would need to be three times the rent in order to qualify for the rental unit. Sharon thought this was unfair, so she asked the local Housing Authority to look into it. She was right—it’s illegal to require higher incomes from unmarried couples.
Don’t be ignorant of Federal and state Fair Housing Laws in any tenant interactions. Discriminating against applicants on the basis of family status, race, country of origin, religion, disability, sex, or color is illegal.
Posted by Teresa on June 2, 2010 under Landlord Paperwork and Forms, Landlord and Tenant FAQs, Tenant Screening & Background Checks |
Leases begin and end; tenants come and go. Often, life interferes with details like legal documents (leases) and a tenant comes to you with an announcement: “I’m moving, but don’t worry—I found someone to take over my lease!”
For some landlords, this is when the worrying begins. For others, it’s not a big deal—having a new tenant without advertising and showing the rental unit is the best part about subleasing.
Subleasing is when a tenant assigns his or her lease to a third party; in effect, they are renting the unit from you, while renting it out to someone else.
To protect yourself, you should be aware of the following when considering whether or not to allow a sublease situation in your rental property:
1. Make sure the original tenant knows that a sublease itself does not release them from the original lease. If the sublease renter defaults on the terms, the original lessee is still responsible.
2. If you as landlord choose to release the tenant from the lease, then the sublease renter becomes responsible for rent and other obligations of the lease, and you become responsible for responding to the sublease renter’s needs under the lease.
3. In many cases, landlords do not release the original tenant from the lease, so the original tenant collects the rent from the sublease renter, and pays the landlord per the terms of the lease. The original tenant is also responsible for any damages to the property caused by the sublease renter.
4. You are still in control—not only can you approve or deny the applicant who wishes to sublease, but you can refuse to participate at all in a sublease situation. You then handle the tenant’s breaking of the lease agreement the way you normally do, whether it’s collecting the balance of the lease period’s rent, keeping the security deposit, or agreeing to let them out of the lease providing you find a new tenant.
5. Keep in mind that tenants don’t always inform landlords of their plans. Sometimes they move out and let their sublease renter move in—and you’re none the wiser. You are under no obligation to accept the situation, and after checking with your legal advisor, may be able to start eviction proceedings against the sublease tenant and the original tenant, too.
If your tenant asks about subleasing your rental property, check with your legal advisor first. To ensure you’re protecting your best interests, as well as your other tenants’, insist on full application procedures and tenant screening on the sublease renter.
Legal disclaimer:
The contents of this article are intended for general information purposes only, and should not be relied upon as a substitute for obtaining legal advice applicable to your situation.
Pre-screen all tenants as part of your standard application process. Background and credit checks will help ensure you rent to qualified tenants. For more landlord resources, including forms and information on tenant screening, turn to E-Renter.com.
Posted by Teresa on May 10, 2010 under Landlord and Tenant FAQs |
Section 8 is the widely-known term for the U.S. Government’s subsidized housing program, which allows low-income families and individuals to live in affordable and safe privately-owned rental housing. The program’s official name is “Housing Choice,” and it is the government’s major housing assistance program.
How Is Section 8 Housing Different from Public Housing?
Those who receive Housing Choice vouchers find their own apartment, townhouse, or rental home, and the U.S. Government pays a specific portion of their rent. Voucher recipients are not limited to public housing—they are free to choose any rental housing that meets their needs.
How Does Section 8 Rental Housing Work?
To be eligible for Section 8 vouchers, rental units must meet minimum health and safety standards. The local Public Housing Authority (PSA) will inspect the unit to determine whether it meets the standards, and if the rent is within the Fair Market Rent (FMA) for the geographic area and size of the rental unit.
Tenants Pay the Difference Between Benefit and Rent
The PSAA calculates the tenant’s benefit. The tenants may rent a unit exceeding their benefit; they simply pay the difference between the asking rent and the amount that is subsidized. For example, an $800 monthly rent might be eligible for $600 in Section 8 assistance. The tenants would then owe the $200 difference, payable in accordance to the lease’s agreed-upon terms and conditions.
How can I Become a Section 8 Landlord?
Landlords who wish to accept Section 8 vouchers must follow certain guidelines and procedures, and inform the local Housing Authority office of Housing and Urban Development (HUD) of their interest. Vouchers are managed at the local level, and are paid directly to the landlord.
Expectations for Both Landlords and Tenants
Once a Section 8 tenant signs a lease of at least one year, the PSA enters into a contract with the landlord, for the same duration as the lease. The tenants are expected to conform to the lease, pay their share of the rent on time, and keep the rental unit in good condition. Landlords are expected to keep the unit safe and sanitary, and maintain the standards that existed when the contract was signed, as long as he or she received housing assistance payments.
The PSA will monitor the family’s income, inspect the rental unit annually, and make sure the landlord meets his or her obligations. The PSA has the right to terminate rent payments if a landlord fails to do so.
Types of Housing Choice Vouchers:
Conversion Vouchers: These help families move to private housing from public housing that has been demolished or otherwise forced the family out.
Family Unification Vouchers: Help is provided for families to rent affordable housing in order to prevent separating children from parents.
Project Based Vouchers: These encourage rental property owners to rehab or build units in specifically to lease to low-income families.
Tenant Based Vouchers: Provided to low-income tenants to help them rent safe privately-owned housing.
HUD-VASH Vouchers: Rental assistance combined with VA case management services to help low-income homeless veterans.
Vouchers for People with Disabilities: Assists low income families with disabilities.
Welfare-to-Work Vouchers: To assist families transitioning form welfare to self-sufficiency.
Witness Relocation Vouchers: Relocation assistance for witnesses of violent crimes that occur around public, Indian, and other HUD-assisted housing.
Posted by Teresa on April 30, 2010 under Landlord Tips, Landlord and Tenant FAQs |
Let’s say you’re a hands-off landlord, who keeps an eye on things outside your rental units; but generally, you don’t go inside until and unless you’re called upon to repair or replace something.
If you’ve ever been surprised by the condition of your rental unit after a tenant moves out, perhaps you should consider inspecting your rental properties more often. Your lease probably stipulates that you are to be given access to the property with proper notice—so before barging in on your tenants, check your local and state laws.
Here are five reasons to inspect rental properties on a regular basis:
1. To see how many people actually live there. If you’re not around to check, who’s going to prevent unscreened tenants from living in your property? You might not ever know that your tenant, the sole lessee who pays the rent every month, actually has 3 friends living in your 1-bedroom apartment. Friends staying over are one thing, but you have the last word on who is allowed to live in your rental unit.
2. To check for undisclosed pets. The Internet is full of posts by tenants who aren’t supposed to have pets and hide them when the landlord stops by; or tenants who are approved for one cat, but have four. What about the 15-pound dog you approved that’sbeen replaced with a 75-pounder?
3. To check for illegal use of your property. Your tenants could be running a business from your rental property—from day care centers to illegal meth labs—and you need to know what’s going on. After all, you are liable for your tenants conduct and activity. Don’t find out when it’s too late that illegal commerce is taking place on your property.
4. To verify proper use of plumbing and electrical systems. Again, you don’t want a fire to be your tip-off that tenants have overloaded electrical outlets. And that small drip under the sink? If nobody tells you about it, you might soon be replacing the kitchen subflooring.
5. To replace smoke alarm and CO2 alarm batteries. Smart landlords keep spare batteries in their toolkits. Replacing worn out batteries can save lives.
From plumbing leaks to illegal drug activity—you truly never know what you’ll discover when inspecting your rental units. Preventing property damage and even loss of life is worth the time and effort involved, so call your tenants and schedule an inspection today!
Posted by Teresa on April 23, 2010 under Housing Trends, Landlord and Tenant FAQs |
Are pets welcome in your rental properties? If so, you may have noticed more tenant applicants who are moving their pets along with their kids and furniture. Pet ownership is up in the United States—and so is the percentage of rental units that are pet-friendly.
But one reason for more pet-owning rental applicants may be the increase in foreclosures in the US. A typical track for pet owners is to get that first dog or cat when they buy their first home. But what about after they lose their job and their home—and must return to a rental lifestyle? Many are finding their pets are not welcome at rental units that otherwise work—and often, these socialized, housebroken family pets are being abandoned in shelters.
The rental market is difficult enough right now—why not remove one barrier to filling those vacant homes and apartments that are not making you any money? If you are a landlord who doesn’t accept pets, why not reconsider that policy? Studies show that allowing pets helps fill vacancies—so it’s good for business. And if you create a solid rental pet policy, you may find that the reasons you weren’t accepting pets (noise, damages, liability) were not valid after all.
Besides, it’s bad enough for a family to lose their home, for kids to move away from their neighborhood friends, and possibly switch to a new school. But it’s even worse when the comfort and companionship of a beloved pet is taken away, as well. Pet owners who are allowed to bring these family members along to a new rental are often so grateful, they are more than willing to agree to even the strictest of pet policies.
We’ve written about pet policies before. Check out the basics, and consider allowing pets in your rentals. You might find that with a large enough pet deposit to cover possible damage, plus clear rules and appropriate consequences established up front, pets in your rental properties can work for everyone!
Posted by Teresa on April 16, 2010 under Landlord Tips, Landlord and Tenant FAQs, Rents and Deposits |
Ask ten landlords about rent due dates and last charges, and you’ll probably get ten different answers—none of them wrong. The thing about running a rental property business is that you get to establish your own procedures and practices to suit your needs—within the limits of federal, state, and local laws, of course. And if they don’t work for you, you can always change them (your procedures, not the law)!
Here we present the results of an informal survey we conducted among four landlords we know:
Landlord #1: This landlord is a stickler for rules. Rent is due on the 1st of the month. It’s late on the 2nd, which is when he posts his pay or quit notice. He doesn’t mess around—and he has excellent cash flow numbers to back up his policy. “A grace period means rent isn’t due until the grace period is over,” he says. Using an online rent payment system helps—all of his tenants arrange to pay their rent online on the 1st of each month.
Landlord #2: Rent is due on the 1st, and a 10% late fee is tacked on the 4th. Each day after, $10 more is added to the late fees. The eviction notice, however, is posted on the door on the 3rd of the month—to encourage payment.
Landlord #3: With many older tenants who depend on Social Security and Section 8, this landlord knows that rent due on the 1st doesn’t work. So, while rent is due on the 1st, there is a grace period until 5 p.m. on the 4th. On the 5th, the 3-day eviction notice is posted; if rent is paid during that time, the landlord adds a $50 late fee.
Landlord #4: This landlord wins the “flexibility” award. Rent due dates are negotiated with each tenant during the lease signing, depending on when the tenant can pay each month. Some have Social Security arriving on the 8th of the month, so that is when their rent is due. Others are paid on the 1st and 15th of the month, so the rent is due on the 2nd. Still others want to pay out of the second paycheck, so theirs is due on the 16th. All of these due dates would cause some landlords to pull their hair out—but this woman says when it comes to money that is owed to her, she can easily keep track of it.
The most important advice these landlords give is to check your local laws—you may not be able to charge a late fee at all, and many states will dictate when you may post an eviction notice.
Posted by Teresa on April 10, 2010 under Housing Trends, Landlord Tips, Landlord and Tenant FAQs |
In 2007, the U.S. Census Bureau reported 62% of U.S. households used the Internet in their home. That’s an enormous increase from 18% in 1997, the first year Internet use was tracked. 82% of those users reported having high-speed access, and 17% reported use of a dial-up connection. By October, 2009, some reports stated that Internet-using households in the U.S. increased to 69%.
It’s clear that the majority of American households use the Internet. And, the majority of those users have high-speed access. Demand has been overwhelmingly established. The only question is who pays for it?
Free Internet service is a common tenant perk. In some areas, it’s a given that a rental condo or apartment will come with free Internet—even though it might be bundled into the rent. In other markets, tenants are expected to pay for all of their utilities themselves—including Internet service.
And even though the first quarter apartment rent report showed promising results in some markets, things are still tough in the rental property business. Plenty of competition means owners continue to create incentives to attract good tenants. Is providing Internet service a good move?
Look at your market. Survey Craigslist.org and other online listing services for rental housing offers in your category. If the majority of single-family rentals do not brag about free Internet, you might need to provide it in yours. But, if you own an apartment building near your local college campus, and everyone else in the For Rent category is offering free Internet, you might have just found the reason your rentals are not filling up fast enough.
Check with your local Internet service provider about the cost of wireless service. Modem leases and monthly charges vary. Ask about security, too—especially if you have a duplex or multi-family housing situation. You don’t want a situation where tenants are vulnerable to stolen information—and you don’t want to provide free Internet to the entire neighborhood! Your ISP should be able to set up a secure system for your rental units quickly.
Whether you pass the cost along to your tenants or not probably depends on the cost, right? Still, hearing “free Internet” might be the tipping point that makes a potential tenant a year-long lease-signing tenant. And if you’re in need of some more of those, you might want to at least consider providing free Internet.
When a tenant informs you that they will not be renewing their lease, provide them with move-out instructions. Written notice of your expectations is always a good idea when it comes to dealing with tenants.
