trisha
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Location: NW Ark
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| Landlording/landladying |
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Okay, you start out little, are in a duplex and need to screen your applicants; those folks will be living on the other side of that wall from you! A neighbor has a form about 1/2 dozen pages long - includes bank information requests. She has done okay with her renters. Are there recommendations? Bong - how do you go about choosing/accepting your renters?
Thank you for your suggestions -
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Sat Aug 06, 2005 5:17 pm |
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bong12187
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| Re: Landlording/landladying |
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quote:
Originally posted by trisha
Okay, you start out little, are in a duplex and need to screen your applicants; those folks will be living on the other side of that wall from you! A neighbor has a form about 1/2 dozen pages long - includes bank information requests. She has done okay with her renters. Are there recommendations? Bong - how do you go about choosing/accepting your renters?
Thank you for your suggestions -
Neighbor is doing it right and I wouldn't change a thing. However, I don't know if he/she has a late pmt fee in place. I have a late pmt fee of $50 if they don't pay the rent by cob 5th of the month. I do everything in writing and follow up on it. If you can have a tenant to stay within 2 years, then you pretty much got your money's worth from them. B
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Sat Aug 06, 2005 11:13 pm |
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trisha
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Thank you, Bong, I am getting copies of her application forms, and of the lease she has also. I had somehow been under the impression that leases really ended up as protection of the tenant, though, that the owner usually ended up the loser in certain siuations. The late fee is interesting, do you do a deposit also? Thank you, T
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Mon Aug 08, 2005 5:20 am |
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bong12187
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quote:
Originally posted by trisha
Thank you, Bong, I am getting copies of her application forms, and of the lease she has also. I had somehow been under the impression that leases really ended up as protection of the tenant, though, that the owner usually ended up the loser in certain siuations. The late fee is interesting, do you do a deposit also? Thank you, T
Yes. equivalent to one month rent. No other circumstances that it can be use as last month's rent. Problem with landlording is that many do not take care of their place. They expect the tenant keep their end of the bargain by paying on time every month but when there is something that needs to be fix, they take their time doing something about it. Maintenance and repair must be immediate and communication with tenant must be constant until the problem is resolved. This way, they will have no bullet to hit you with when you guys actually go to court. Tenants will be more than happy to pay you on time if they know that you are there to help them fix or repair their unit. And, if you are able to get two years from them (more is better), then you already got your monies worth. By the way, since you are the one in charge of writing the lease agreement, please rewrite it for your advantage, instead of the tenant.
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Mon Aug 08, 2005 6:32 am |
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Andrew
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One tip that I liked a lot was this:
Instead of charging a late fee, provide an on-time discount.
That way you don't feel as bad about charging Mrs. Jones that extra $50 when it's late, you simply don't provide the on-time discount.
More of a positive reward, instead of negative punishment.
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Mon Aug 08, 2005 10:16 pm |
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bong12187
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quote:
Originally posted by Andrew
One tip that I liked a lot was this:
Instead of charging a late fee, provide an on-time discount.
That way you don't feel as bad about charging Mrs. Jones that extra $50 when it's late, you simply don't provide the on-time discount.
More of a positive reward, instead of negative punishment.
This makes alot of sense but should only be used for properties that you can't micromanage. Giving $50 on-time discount is probably ok if you only have one or few tenants. Think about losing a revenue of $50 X 40 units x 12 months. That will come to $24k a year of loss revenue. You can't deduct it nor can you put it under charity. I don't feel bad at all on collecting extra $50 from Mrs. Jones. The bank which owns my property will not care whether I am giving away $$ or not. I provide a good service and I expect to be paid on time. Just like they expect me to make immediate repairs on leaks on their plumbing. The last time I check, I am doing this to make a profit not to give charity. We have to look at landlording as a business with intent of bringing in profit.
Just for clarificaition, I am not opposed to Andrew's suggestion. I am currently doing that to my rental in another country. The way I did it is for the tenants to deposit their payments on the first of the month for them to get a 10% discount. My caretaker then receive the deposit slips and I see the deposit online and on real time. However, they still pay the late fee if they don't pay by the 5th of the month. The only reason why I am doing this is because I can't be in two places at once and the cost of flying to another country to enforce late fee (without rewards) is just too expensive to do (eventhough they are tax deductible).
For those of you who are planning to become a landlord, always remember that the bank will not care whether you are a good samaritan or not. You signed a contract with them and they will enforce it to the teeth. There were tens of thousands of foreclosures within the last couple of years with billions being lost because some novice landlords couldn't manage their own rental units to make a profit.
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Tue Aug 09, 2005 4:38 am |
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trisha
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Thank you Bong & Andrew, for this good information.
Bong, when you say they deposit on the first and the caretaker receives the deposit slip that same day, the time of day is irrelevant, right? The money is in the bank, even if the bank doesn't post it until the next day.
When a payment date comes on Sat/Sun, I expect my creditors to advance the due date to Monday, that is not always done, but I like to think that way. Is that how you two think??
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Tue Aug 09, 2005 5:11 pm |
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bong12187
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quote:
Originally posted by trisha
Thank you Bong & Andrew, for this good information.
Bong, when you say they deposit on the first and the caretaker receives the deposit slip that same day, the time of day is irrelevant, right? The money is in the bank, even if the bank doesn't post it until the next day.
When a payment date comes on Sat/Sun, I expect my creditors to advance the due date to Monday, that is not always done, but I like to think that way. Is that how you two think??
Time of day is irrelevant. Some banks do not post deposits if the the transaction is done in the afternoon. This is where the deposit slips comes in handy because it will have the date and time the payment was made. The main point of the exercise is to have them get used to the idea of paying on the first of the month. If 1st of the month fall on a holiday/Sat/Sun, then the first Monday or working day of the month becomes the due date. Good luck...
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Tue Aug 09, 2005 6:16 pm |
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