Eviction is a Necessary Task in Property Management

 

 

 

Many counties in the United States do not report evictions to credit bureaus and it takes specific searches to discover these records.  This kind of search can be done by a landlord or property manager in the local counties but is time consuming and not always reliable.  The reality is that often a resident will apply for a new rental home while he/she is being evicted from the current residence and there will be no record at all.

We spoke with Equifax recently and found that they have just purchased a small company which is now collecting this eviction data across the country.  In several years there will be a new data base with this information which will be available for credit reports but we still have to deal with what we have today, which is precious little with regard to eviction history.

That being said, we still have our rules and regulations to abide by and therefore will have to enforce them for the benefit of all.  So there will be the occasional eviction.

The article below is a good summary from Expert Law which will help you if you find that you are needing to proceed with an eviction.

Read More Here

 

My landlord is withholding my deposit and is refusing to return it. How do I deal with this situation?

In most places your landlord is required to send a statement indicating what expenses were paid with your security deposit. This usually has to be done within a certain number of days after you move out. If you never got a statement, you should first read your landlord tenant laws and then if your state has those laws file against your landlord in small claims court. Provide proof to the court that you paid the security deposit and also a copy of your lease agreement. Show up and you will prevail.

Should I evict my tenant? He is chronically late paying the rent every month. I charge him a $50 late fee every month. That’s the max that I can charge.

Ok, this happens sometimes. But there actually may be a reason. Have you spoken to your tenant about the late payments? If not, I recommend that you do so. What you said here is that he pays every month but just late. Maybe it is because he gets paid by his employer in mid month. If that is the case, you are actually getting more rent every month to let this go on. There are two remedies here. If you find that he is getting paid later in the month, you can change the date that his payment is due. But at the same time, I would collect an extra month’s rent so that you can make your mortgage and other payments on time every month if this is the case. When you do this be sure that you write an addendum to the lease explaining the date due change and why you are doing this. Have the tenant sign and you sign and keep it with your lease. For use in case of disputes or need to present to a judge.)

If the tenant gives you some lame excuse for being late every month, like, “I took my kids to Disneyland and did not have enough money left to pay on time,” then your approach will be different. Remember that you are still getting paid every month and also getting more rent for having to wait, so this is how I would handle it. (oh and by the way, what is keeping you from charging a % of the unpaid rent and even a daily late fee? Are there laws in your city that prevent higher late fees for failure to pay on time?) I would again ask for a month rent ahead of time. I would also get the tenant to agree to a daily late fee so that he is charged rent (as interest) for every day that the rent is late. You may say this is too much work to figure out. To that I say, check out the software that I use to manage my apartments Smart Property Systems. I know that they are bringing out a special edition of the software called Ideal Landlord soon. It will cost you about $18 per month for one unit and you can set up the daily late fees in the system which are automatically added if the tenant is late. Plus everything else is also automated.  It will make you look very professional and cause your tenant(s) to pay more attention to their responsibilities.

Finally, if the tenant has missed months of paying rent, then you should issue a 3 day notice to pay or vacate. Typically this is issued when the rent is late the first time to force payment.  At the same time issue a 30 notice to vacate the premises. If they fail to pay the full amount due in 3 days, then you can start an eviction. But you also have the security of the notice if they fail to move and can provide those notices in your documents if you have to evict. It will make you look like you are on top of your business to the judge.

If you have to evict, you will need to go to court and fill out documents which will then be served to the tenant by a process server. There are process server fees and court fees for filing. The judge will need to see the lease agreement signed by both of you and a payment history showing the delinquencies plus all notifications and notices that have been sent. Do add your costs and your time for doing the eviction. Most judges will award you reasonable court fees and time by the hour you spent to manage the eviction and charge it to the tenant. Good luck.

Taking Over Grandfather’s Apartment Complex

Hi everyone! I’ve been presented with an opportunity of a lifetime today and need some advice from you amazing people!  My grandfather has been working out his will and apparently, I’m going to be the recipient of his 12-bedroom apartment complex. This is the opportunity of a lifetime but I’m a little nervous owning and managing this property at such a young age (22). The complex needs a lot of work, it’s currently on the lower end for rent for my area, $750 a month 2 bedroom 1 bath units.

I have a few questions and am looking for advise here on how to proceed. I’ve reviewed his lease (which is about 10 years outdated) and have noticed that a newly rewritten one will probably be the first action I take. It is located across the street from a private university, but no university student has ever stayed there. My goal is to turn it into more of a college student housing hopefully, but I know that opens up a whole other can of worms. The college has also presented an offer to buy the property so they can level it and build a parking lot there ($100,000).

I’ve just graduated college and selling the property would be a great short-term option, but my finance side is ready to take this head on and hang on for the long run. How do I manage a property? How do I proceed to meet all my tenants and know if they are good people?

How do I reinforce my soon to be written lease agreement? How do I evict people? How do I handle frequent late payments? If I wanted to get a whole new set of residents, how would I go about getting all the current residents out?
Should I sell now and not take on this project? I will be owning my family business within the next 10 years when my dad retires and I’m unsure how over worked I will be. Thank you all!

Response:

The value that the University offered for the property seems low to me. I know that you are young and probably feeling a bit overwhelmed but the reason you went to school is to learn how to think. I think you can manage this property and make money doing so. First of all, if you have some money available, I would have a contractor that your dad and trusts come and do an inspection of the property to find out what the problems are. Some common ones are old and leaky plumbing, asbestos in walls or in popcorn ceilings, mold, rotten wood in joist near bathrooms or kitchen, water leaking under the foundation, sinking or cracked foundation. Once you have that report you will have a better idea if this is something you want to take on.

Second, I am going to recommend that you invest in software for your property management. I own a property management software company, Smart Property Systems and know that we can help guide you all the way as well as provide affordable tools that will keep you on track to be successful.

Once you have done that, you can go to rentometer.com to compare your rents with the rents in the neighborhood that are similar units. Now review the tenant files to see who pays rent on time and who does not. Look at inspection reports to find out how they take care of the property. If there is no data, you will need to ask your grandfather.

Now schedule inspections for each unit. You are required to give notice before you inspect the units and I would recommend at least several days’ notice. Smart Property Systems customer service can provide you with a document to use for inspection. Be sure to fill it out as you go through and have the tenant sign and date it when you finish. You can then make a copy for them and give it to them when you speak to them next. Now you can make a decision about who will stay and who will have their tenancy terminated if month to month and not extended if on a lease.

 

Can My Landlord Evict Me without the Proper Notice?

Basically no. In all states there are landlord tenant laws that dictate the length of time required for giving notice even if there is no obvious reason for doing so, from your point of view. However, if you fail to pay rent on time, your landlord can give you a 3 day notice to pay or vacate. In the few times that I have been forced to give a tenant that notice, I also gave them a 30 day notice and on the 3rd day of non payment, and eviction notice.

That being said, you do not mention how you know your landlord wants to evict you. I assume you were told verbally. Notice needs to be made in writing. It can be posted on your door and mailed to your current address of record. It can also be served by a process server.

If you have no notice but your landlord told you to move out, I suggest that you contact that person to discuss the problem and try to resolve it. You can also hire a lawyer but it will be quite expensive and you will probably not recover any of those costs.   If you are given notice and it is not resolved, make arrangements and move out as per the notice.

Will I make more money through Airbnb or renting out my property?

First of all, I will establish what kind of property you own or wish to own. If you have a home or a condo or apt and you want to make money renting a room, you will need to check the rules and laws of the association if there is one. By doing this, you will learn whether you are permitted to rent part of your home. If you don’t own your home and are a tenant, you will have to get written permission from your landlord/manager.

Then you need to decide how much you want to have someone else in your space. Renting a room long term can be hard. You would be sharing your home with a stranger basically. If you want to make a bit of extra money, you could offer a room through AirBNB or whatever reservation software you wish to use, several days or weeks a month. You would basically only meet these tenants and they would be gone. But you would be responsible for cleaning and laundry and making sure your place is a bit upscale to get tenants. The rent (tariff) is paid upfront to you after AirBNB takes their cut, so you will get paid. If you decide you don’t like renting your place to strangers, you can always quit. With a long term lease, you would be obligated to endure the lease period.

If you are planning on renting a separate space, like a single family home, whole condo, apartment, you need to start by learning what is and is not allowed in the neighborhood. I say that because many areas have prohibited owners from offering short term rentals because of the increased traffic, parking problems and strangers coming into the neighborhood. But if you find no restrictions, remember that when you rent an investment property through AirBNB or some other short term rental software, it will become a full time job to manage move ins and move outs, cleaning and supplying the unit, keeping up on repairs, baking cookiesfor arriving guests, etc. Many sub that work out to a short term rental property management company, but that cuts into your profits, of course. And you are dependent on whether you get the place rented. If you only get 50% occupancy per month you may not be able to break even on the cost of the rental. Property management for short term rentals is usually 25% of the rent collected because it is so hands on.

On the other hand, you can rent your property longer term. If you are in a resort area, you could rent for a minimum of 1 to 3 months. Or you could do minimum 6 months or 1 year leases. That business model gives you guaranteed income on which you can plan, as long as you choose good tenants who pay rent on time.

And finally, if you are in a high demand area or seasonal demand area, you can rent part of the year using a short term rental registration software and the other part of the year rent to someone longer term. Just remember that the cost is high every time you turn the unit.

So the decision is up to you. How much risk are you willing to take. How much time are you willing to spend. Finally, no matter what you decide, if you do invest in rental real estate, get a good software that allows you to advertise vacancies, gives a tenant screening portal, and does the accounting for you. The short term rental software products do not give you these features. I use Smart Property Systems. It is easy to use, inexpensive and has all of the bells and whistles you will need to be successful. Good Luck.

How the Eviction Process Works

March 9, 2016

Source: This article was published with permission from LegalTemplates

Eviction notices can be daunting for all involved- both for Landlords and Tenants. While most issues are encouraged to be cured via problem-solving and clear communication, occasionally an eviction notice will be served.

Both sides should know that they could ultimately end up in front of a judge. Eviction processes are highly regulated since the law protects both sides and the court makes the final decision. Instead of allowing people to take the law into their own hands, the eviction process ensures both the Tenant and Landlord are given fair treatment.

Luckily, this process is quick when compared to other legal cases, as it is considered a “summary” court procedure. This means timelines for arguments are shortened to speed up the resolution or court decision. Instead of waiting months to hear the case, the Landlord and Tenant can appear before a local court soon after the Landlord files a complaint.

To help visualize the eviction process, Legal Templates created an info-graphic to detail how this works and what to expect:

Customer Service is an Important Part of Property Management

happy tenantsIf you work for a property management company you know the importance of maintaining good relationships with your owners and tenants.  And if you are self directing your own property management you probably know that tenants and landlords often clash.  But it does not have to be that way. You must stay on top of your management tasks, and let your tenants know that each one of them is important to you.

Our company has provided software for property management to over 20,000 subscribers since 2005.  We are recognized as one of the best property management software companies and, by the way, we have just rebuilt the software to be even easier to use thus making the communication with tenants even better.  The legacy software won a webby and the New Release has already won a Best In Business for software award. With all of this experience, there are some things that we know will help you get good tenants, keep your tenants happy and retain them longer.

Expect the Best from your Tenants

You are entering into a business contract with each tenant. You expect them to pay rent and care for your property in return for their access and right to occupy to a quality property in which to live or work if it is a commercial property.  Remember that it is a business relationship, not a friendship.  From the beginning treat the tenant with respect.  Once the lease is signed the tenant has agreed to pay rent on time.  Be sure that he/she does just that.  We recommend use of automated rent payments made through a tenant portal which contains all of the pertinent information that they need plus a way to make their rent payment in less than a minute. If they are late, do not offer to waive late fees. In the automated system, late fees are added automatically on the designated day.  Waiving late fees only encourages more late payments.  If you have a chronic late payer, make arrangements so that rent is due after they have received their wages or can reliably make the payment.  If that means you extend the grace days a few more days then that is a better way to resolve the issue than to waive late fees. You might also have them pay two times per month instead of once.Don’t worry, if they are using automated rent payments, the accounting is done for you when that payment is made. And remember that any changes to the original agreement need to be memorialized in writing and signed by both parties.

You Make the Rules

It is the responsibility of the landlord or property manager in conjunction with the owner to make the rules for tenants residing in the property.  Include those rules when they sign the lease.  We recommend a separate document stating policies and rules as well as vacating procedures.  The tenant signs that document and it becomes part of the lease.  Tenants need to know the rules before they move in, not when they have violated one.  Tenants need to know that they are responsible for  being cordial to neighbors and abide by the rules of the property.  It is always best to meet the tenant in a professional environment like an office.  Our SPS software offers esign for leases and notices so that an office is not required to look professional.  One other thing that is very important is good communication.  The SPS software has tenant portals through which the tenant can easily notify you of any issues or report maintenance items.

Get Repairs Done Quickly

Things happen to rental properties during normal wear and tear, and repairs need to be done to keep the property in good shape.  Occasionally there is also tenant caused damage, like a child flushing toys down the toilet or someone hitting the garage door with their car.  Both types of damage should be repaired by the landlord or property manager, not the tenant.  The most important thing that a landlord can do is get the repair done as soon as humanly possible.  The tenant can be billed for tenant caused damage or the security deposit can be used if they do not pay. We recommend billing first so that the security deposit remains in place for the future.  Always follow up after the repair with the tenant to be sure that the repair was done to the satisfaction of the tenant.  We recommend that you inspect the repair or at the very least have the contractor take pictures before and after the repair and send them to you.  Your tenant will know that you care about their comfort and you will retain them longer.  Maybe even more important is that you will be sure that your property is kept in top condition.

You Must Do Inspections

Inspections are part of the price of doing business.  Inspections done regularly will insure that there is no major damage being done to your valuable rental property.  With new tenants, you may want to do an inspection or visit the property in one month to see how the tenant is faring.  At the same time you can look around to see how they are caring for the property. If all is well you may schedule the next inspection visit for 3 months.  If things look dicey, give notice to clean it up and come back in a week to inspect again. This may seem like over kill but we have seen some tragic situations experienced by our subscribers when they do not use the inspection software available to them. One subscriber found three families living in a two bedroom house.  Only 4 people were on the lease.  Another found a herd of cats, none of whom were authorized by a pet agreement. In fact the pet agreement clearly said that no pets were allowed.  If these situations had not been discovered, you can only imagine the damage that would have been done to the property.  Inspections are an ounce of prevention against pounds of cure.

Develop Good Relationships

Always be cordial to your tenants.  They are supporting your business and even if you may not like them personally, you need to be pleasant.  Remember that your tenants are not your friends.  They have a business relationship with you.  That does not mean that you can’t send Holiday cards or throw parties for the multifamily community once in awhile.  But in the process of running your rental business, be firm and fair, attentive and respectful.

Smart Property Systems gives our subscribers the tools to be able to develop good relationships with tenants, members of associations, and owners of residential and commercial properties.  That is accomplished with automation of most repetitive tasks and by allowing all stakeholders in the business to easily communicate through the portals.  If you are not using software or are unhappy with your current software check out https://smartpropertysystems.com.

Submitted by: Timmi Ryerson
December 18 2015

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Do Your Tenants Need to Know How to Budget?

I listened to a web cast today on how to fill vacancies with residents who will pay rent.  I was surprised to hear that the incidence of failure to pay rent is going up.  The fact, according to this presenter, is that rents are rising and incomes are staying the same.  That means that more of a family’s budget has to be put toward the rent. There are several safeguards that can be used by the property manager when renting to someone with little or poor credit history. But the one least used, that comes to mind for me, is giving the tenant a bit of good old fashioned education about how to budget.

Young people, especially students, are sometimes on their own for the first time. Budgeting may be taught in business classes but I have not heard of it being taught in school as a general rule.  Another category of high risk families is single mothers with no child support.  However, poor rent payers are not just limited to these groups.  They come from all income levels and backgrounds.  But everyone needs a place to live.  Everyone needs shelter and to be able to feel safe and secure in their home. Furthermore, it is against the law to discriminate when considering an applicant unless that applicant obviously does not earn enough money to pay the rent.  So there are going to be times when you will rent to a high risk tenant.  Of course you always use tenant screening, and check pay stubs, and speak with employers, and past landlords before deciding to rent.  Those are tried and trusted ways to get good tenants.  But we have all had to get after our tenants at one time or the other for failure to pay on time.

budgetingThe next suggestion I have is that these high risk  tenants should get the budget your money talk.  “The rent” is the most important payment a resident makes each month.  Oh they may argue that they need a car more than a place to live, but with that mentality, they could end up living in their car.  Ideally rent makes up 25% of the monthly budget.  But recently it has creeped up to an average of 33% of the monthly budget.  That leaves car payments, insurance, utilities, food and clothing and finally entertainment to be budgeted (planned). Hopefully they are not into using credit cards when they run out of their own money or the situation could escalate from good to bad very fast.  If at risk tenants turn this sequence around, you will see many failures to pay rent. Unfortunately we see the reverse sequence all too frequently. (i.e. entertainment, clothing, food, utilities, car payments,insurance, rent)  At least if you have the talk, you will put them on alert.  Hopefully they will realize that budgets are a great way to keep everyone happy and give them the feeling of control over their lives.

I have been in property management for many years managing my own investment properties, before I bought a software company that provides software for property management. In both capacities I have heard all kinds of excuses and reasons for late rent payments.  You all have heard them.
“I mailed the check. Didn’t you get it? It must be lost in the mail”.
“I gave the rent to my husband. Didn’t he give it to you ?”
One of the best was “I had to take my kids on vacation and don’t have enough left
to pay rent.
“I dropped an envelope with cash in the door slot of the office.  It is not my fault if someone stole it.”
And another doozie “I already paid the rent last month.”

Then there is the issue of paying on time.  When you don’t get paid on time, your own budget and finances suffer.  It costs the property manager money every time a rent is late.  Of course we have found that through use of online automated rent payments, the excuses go away.  There is no more excuse for late rent because it takes the guess work out of where the rent is and all of the arguments listed above, except the vacation situation, are no longer valid.  But that is a topic for another blog.

I think it is a great idea for the property manager to talk with any young tenant, first time tenant or person with poor credit about “the importance of paying rent on time, every time it is due” before handing over the keys.  Sometimes they need to hear that rent should be the first bill they pay before they spend money on anything else.

The other question to ask your new tenant is on what day they get paid.  A solution to late rent payments may be as simple as setting the date rent is due to a couple of days after the person gets paid, or at least make the grace period long enough to accommodate that tenant. In some cases, it may be a good idea to add language to a lease document stating that the conversation about how to budget for the rent payment was done.  It may also be a good idea to offer a booklet about budgeting with a sample budget to demonstrate how easy it actually is.  I realize that this kind of approach will not solve all of the problems with poor rent payers but it may bring your percentage of on time rent payments up a few percentage points.

Timmi Ryerson
Smart Property Systems
help@smartpropertysystems.com

Press Release:Smart Property Systems Announces New Collaboration with TransUnion SmartMove®

Smart Property Systems Announces New Collaboration with TransUnion SmartMove®
PRWeb Follow
August 28, 2015 7:12am Comments: Smart Property Systems, a leading cloud application software for property management, is pleased to announce a vendor agreement with TransUnion.

Sun Valley, Idaho (PRWEB) August 28, 2015

 

for rent tenant screening




 

Smart Property Systems announced today a new integration with TransUnion SmartMove®, to offer tenant screening solutions. Using TransUnion SmartMove, Smart Property Systems users can order a credit report, which is formatted for tenant screening purposes, and a criminal report, drawing from millions of national and state records. These tenant screening reports include a recommendation based on the Smart Property Systems subscribers’ rental criteria.

Smart Property Systems subscribers are able to order reports from their subscription dashboard menu to screen tenants on easy to use order requests. Reports are returned into a system that collects and stores the reports for viewing as needed.

“Ordering a Tenant Screening report is one of the most important tasks a landlord or manager does when choosing a new tenant for their valuable rental property,” said Timmi Ryerson, CEO of Smart Property Systems. “We are happy to have this direct relationship with TransUnion, which provides good quality, reliable reports with recommendations based on property criteria entered by the subscriber. Landlords and managers need to receive these reports quickly to facilitate rapid turnovers. The motivating goal of staff at Smart Property Systems is to reduce turnover time and help the subscriber increase profitability.”

Smart Property Systems subscribers can get complete reports from TransUnion SmartMove by clicking on the order button in the subscriber account and filling out the information from the tenant application. Prospective tenants are contacted via email to authorize the report. Once the prospective tenant authorizes the report, property managers and landlords can review their TransUnion SmartMove report within minutes.

“TransUnion SmartMove offers a tenant screening solution that is efficient and easy for both prospective tenants and for landlords,” said Jason Norton, vice president of TransUnion SmartMove. “Now, Smart Property System subscribers will benefit from greater insights into the credit and criminal history of their prospective tenants.”

As soon as the tenant complies and authorizes the report, it is sent back to the report file at Smart Property Systems. For a demonstration of this functionality, contact Smart Property Systems or visit smartpropertysystems.com.

smartpropertystystems.com
855 796 7771
help@smartpropertysystems.com

About Smart Property Systems
Smart Property Systems has offered best in class software for property management since 2004. Over 20,000 subscribers have been served since the Company opened for business. In May 2015 the new build of the code was released and all active subscribers from the legacy software were moved to the new platform which is built on the latest Ruby on Rails with HTML 5 technology. This software offers stability and security to the users, and automates the repetitive tasks required when managing properties and leases, whether residential or commercial. Customer reaction to this new software has been very positive. Smart Property Systems software supports the complete rental cycle with features that make property management easier.

About TransUnion SmartMove
TransUnion SmartMove is an easy, reliable online tenant screening solution designed to give independent landlords the results they want — and renters the security they need. Landlords receive a TransUnion credit report formatted exclusively for rental screening purposes, a criminal report drawing from hundreds of millions of national and statewide criminal records, a national eviction report, and a clear, reliable and customized leasing recommendation. Renters get the peace of mind that only TransUnion, and not their landlord, will have access to their sensitive personal information. SmartMove is powered by TransUnion.

About TransUnion
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Information is a powerful thing. At TransUnion, we realize that. We are dedicated to finding innovative ways information can be used to help individuals make better and smarter decisions. We help uncover unique stories, trends and insights behind each data point, using historical information as well as alternative data sources. This allows a variety of markets and businesses to better manage risk and consumers to better manage their credit, personal information and identity. Today, TransUnion has a global presence in more than 30 countries and a leading presence in several international markets across North America, Africa, Latin America and Asia. Through the power of information, TransUnion is working to build stronger economies and families and safer communities worldwide.

We call this Information for Good. http://www.transunion.com/business

For the original version on PRWeb visit: http://www.prweb.com/releases/SmartPropertySystems/Transunion/prweb12927213.htm

Read more: http://www.benzinga.com/pressreleases/15/08/p5798819/smart-property-systems-announces-new-collaboration-with-transunion-smar#ixzz3kPdeAw6Y