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Any Advise to being a landlord

Discussion in 'Off Topic Threads' started by copper, Sep 12, 2009.

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  1. copper

    copper Member

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    Well buying a house closer to jobs for me and the wife am thinking about renting our house, have never been a landlord but don,t want to let it just sit around is nice ranch nice era with good rent interest, any long time landlords have advise for a new comer to this. I think I will cut grass excuse to be by once a week. I am only moving and hour south thanks Dave
     
  2. joe kuhn

    joe kuhn Furry Lives Matter TS Supporters

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    Dave,

    I'm not a land lord, but our neighbor was in your situation 3 years ago. He hired a rental company and the situation went to hell from day 1. Two renters later he has taken over again and had to fix the damages before attempting to sell thru "for sale by owner, on line".

    As the neighbor to all of this I can suggest, if your intent is to come by once a week and stay involved, you can probably keep your house intact and mostly ready for when you do decide to sell. Problem is your renters may demand privacy which means you don't know what's going on inside your house.

    [long story removed]

    After professional repairs and lots of work by owners themselves, the house is finally up for sale and in nice shape. Of course we have a new green border whose original purpose was to hide the ugly pool situation, which is no longer needed. You'd never know there was a pool there. Forgot to mention the county involvement for not getting a pool permit or putting up a fence so some curious neighbor kid doesn't drown in the pool.

    Decide for yourself whether or not you want to be a land lord, but my exeperience as a neighbor would say, sell at any price you can get; you'll be money and time ahead. Granted we live in an affluent suburb of Chicago (meant sarcastically). Things will touch your situation (economy) you have no control over.

    A guy I used to shoot with used to live in the condo back to back, and he is renting to some good people, but some kids have been riding dirt bikes on the road back there and he asked me to call him if I hear of any activity of the sort.

    Best of luck.

    Joe, Not a land lord and never to be one by my own volition.

    Forgot to mention that both renters had dogs which required replacement of carpeting. Arf, arf, call Cesar Millan!

    Thanks for the chance to air out after the shananigans next door.
     
  3. moore5833

    moore5833 TS Member

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    Charge a large security deposit-enough to cover first and last-get references from renters-and follow up. Form a lease agreement which spells out your demands,never-never-never allow pets. I love dogs-cats,but they have accidents! and wreck stuff. The renter should be maintaining the property,so you shouldn't have to mow. We rented duplexes many years,and it seemed to buy a wash at the end. They pay there own way,and give you leverage to borrow against,but no profit. done right-you'll be okay
     
  4. copper

    copper Member

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    Well I understand that part of it not realy looking forward to being a landloard have house for sale market is slow to say it mildly. We have been on market for about 4 or 5 months with some interest only a few lookers but most came back twice . I know people who have a few rentals and have some bad stories but must work because they do it for a profit. I have to do some repairs to house we are buying of course I can fix most anything myself so we will see. the house I am planning on renting there is no morgage the second one yes so would be nice to get some cash towards that. Dave
     
  5. joe kuhn

    joe kuhn Furry Lives Matter TS Supporters

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    My advice is to work from your strengths and learn by stretching yourself, but do so consciously. I say piss on the economy, sell for what you can get, but then it's not my money. If people came back twice your price is just over their limit. Consider coming down once more and wait.

    The guy I bought my Mach One from kept coming down in $500 increments because he really wanted to sell. I watched this and when he made it below my limit, I jumped. He got some cash to help him buy his new Infinity and I was happy as a clam with a great shooting gun.

    Good luck.

    Joe
     
  6. Dahaub

    Dahaub Active Member

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    I have a good friend who owns and is a landlord to several familys. One thing he says is to check referrences of those who want to rent. Make sure the damage deposite will cover the cost of carpet cleaning. No pets. Do the weekly quick inspections so you can keep abreast of how the outside of the house looks and if needed have them let you in to check the furnace filters and air filters and the water heater so you can get a look at how they are taking care of your place. The low down dirty method he uses to get rid of dead beats is to take the front doors off the place and tell them he has to repair them. He usually leaves them off for about three days and the dead beats are out by then. I didn't think that was legal but he says for maintenance you can do it. If you really take care of your place the only people who will not damage anything is your own mother. Get used to having to repair small things and paint when tennants leave. Dan
     
  7. whiz-bang

    whiz-bang Active Member

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    My brother and I own 53 rental unites and for the most part we don't have to many problems other than maintenance. We do require a criminal back round check. That will take care of rift raft most of the time. Make sure your renters have jobs. Never rent to any one that has drinking or drug problems. This sometimes shows up in a criminal back round check. Make sure on your contract that you are renting to only them and not there friends. Get at least one months rent and a security or damage deposit up front. You may want to go to your local unite of government and pick up a pamphlet on renters and land lord rights required by your state this a must. That will help keep you protected. Just make sure you have responsible renters and you will be ok.
     
  8. motordoctor

    motordoctor Shoji Tabuchi in Branson

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    ig they get behind make sure to give thema three day notice--if required in your state- immediately. Some state allow you to write a LEASE like--examply rent is 700 per month but if you pay by the 3rd thre payment is 650. Your actual rent is 650 but yoou build in a penalty. Some places it is not legal. You write the lease for the complete amount of the lease and then divide it up by the monty. Do not let them get behind. You could also make them pay the rent electronically so you make sure to get your money. The big thing is their reputation. You can also go to where they are living and ask to look inside to see hoe they live. Many people are not allowed to provide a reference. The rest of them lie to get rid of the renters. BE CAREFUL.
     
  9. birdogs

    birdogs TS Member

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    Write a strong lease!!!!
     
  10. MGeslock

    MGeslock TS Member

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    Being successful as a landlord can be very easy.


    Use forms that protect your interest. Some of the above posters have excellent advice.


    It starts with the application. It should allow for you to pull their credit report and references. Be thorough in the investigation. If there are judgments find out why. If medical shows up, find out if it was a result of an accident, lack of coverage. Most of these are due to people that do not have medical insurance. If they do not like to pay AT&T, Sprint and Verizon... that’s just a red flag.


    Make sure that your lease is solid. How does it cover repairs? Where is the payment sent to? When does it end? Can they paint rooms? Pets allowed? When is the security deposit returned? What happens if the rent is late? Do you have a "pay or quit notice" to mail to them? How do you handle bad checks? Have you ever been to court to collect a check or evict someone?

    I would stay away from the boiler plate applications from Office Depot, Staples and the like. They are universal and not state specific. You may forfeit some of your valuable rights. Have an attorney review or draw up your lease.


    Advertising. How will you get it to the masses? These are for sale stats and not for rent, but the same information applies. (http://www.realtor.org/library/library/fg006)


    For Sale By Owner (FSBO) Statistics
    FSBOs accounted for 13% of home sales in 2008. The typical FSBO home sold for $153,000 compared to $211,000 for agent-assisted home sales.


    FSBO Methods Used to Market Home:


    Listing on Internet/FSBO website: 45%
    Yard sign . . . 42%
    Friends/neighbors . . . 33%
    Newspaper ad . . . 22%
    Open house . . . 18%
    Most Difficult Tasks for FSBO Sellers:


    Selling within the planned length of time: 13%
    Getting the right price: 12%
    Preparing/fixing up home for sale: 11%
    Understanding and performing paperwork: 10%
    Having enough time to devote to all aspects of the sale: 8%



    I would suggest that you find a local real estate firm that will put your home in the MLS and internet. Have them pull the credit report and references. Allow them to write the lease. They should allow you to be the landlord and only find you a tenant. Make sure that you understand the documents.


    In my humble opinion, most owners are not qualified to manage properties. There is too much to know and learn.


    SEEK THE ADVICE OF A LOCAL PROFESSIONAL! Then make your decision.


    Mark Geslock, Associate Broker
    Prudential Simpson & Associates, REALTORS
    Licensed in the Commonwealth of Virginia
    (The required disclaimer)
     
  11. halfmile

    halfmile Well-Known Member

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    I have 2 different application forms I use. One is for normal looking people. It calls for basic info and references.

    the second one which I use for people I do not want to rent to has 4 pages and is hard for riff-raff to fill out, asking for much more information and history, in addition to information on all other potential occupants.

    I also go online to the clerk of courts and check history regarding judgements and other bill collectiong actions. If you want you can get a credit report, there's some cost there.

    A surprise visit to the potential renter's present home can be a real eye opener too.

    I do not discriminate against applicants, but if the source of income is "lawn care" or "child support" you can bet that one goes in the round file.

    length of employment is one of the best indicators, when added to length of previous tenancy. I just rented to a fellow who was in his previous place for 15 years, moving because the area had become too ethnic for him.

    Watch out for the ethnics, they send a well dressed woman to conduct the business, and want to pay cash up front for a quick deal. I had several Asians pull that one.

    You can not discriminate, that is illegal. However, nothing stops you from being the judge on ability to pay.

    I have had to do extensive damage repairs 2 times in the last 20 years, and I had 3 single family homes. Went to court once and got the money, too.

    Good luck and be careful.

    HM
     
  12. warren

    warren Member

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    Yes, don't do it.

    warren
     
  13. need to shoot more

    need to shoot more Active Member

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    With all growth ( monies & humans)comes some pain along with some consessions.
    We bought our first 14 years ago, we have two currently with a offer on another. If you stay small it is managble. On the other hand the lawn cutting does not sound attractive but a good excuse too see YOUR home whats going on and pick up monies. Are you going too drive a hour for snow removal( if it applies)? It is a great investment,deduction and asset if needed.
    Best of luck,
    Jim Zee
     
  14. W.P.T.

    W.P.T. TS Member

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    Be prepared to hear some wild excuses why the rent cannot be paid on time and hear them several times over ... When you go to evict them (if you do) watch and see how much damage people can do in a short time span ... Keep it a business relationship and do not turn it into a friendship because then they will ask for favors that only friends will ask for ... Been there, done that, and hope I never have to do it again, and I had good tenants ... WPT ... (YAC) ...
     
  15. Jerbear

    Jerbear TS Member

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    One other thing to make sure, go to your local town hall/ city hall and find out what your renter tax will be as to the home Owners tax. In my township, they are cracking down on people buying up foreclosures to rent, and not declare they are a rental property. taxed at a different rate.


    A neighbor who has one on the block, just about sh!t when he got his revised tax bill. Just make sure you cover any new taxes if you rent.


    Jerbear
     
  16. trim tab

    trim tab Active Member

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    Fill out credit application and run a credit bureau, criminal background check, no sub renting ( cannot rent rooms to somebody else) Look at time on job. Always had betere luck with husband wife renters or mother daughter renter.Don't tolerate late payments or promises. Get first and last paymnent up front PLUS one payment as security deposit for possible damage and cleaning etc. .and NO PETS. No grace period for rent payment. Penalty if payment is late. IF youhave an assocaiton, show them the rules (give them a copy) and have them sign that they read them and will abide by them. You take care of yard and pool if youhave one and include in the rent payment if kyouhave it hired out. Don't let renter be responsible as they will do a poor job 99.9% of the time as it is not theirs. Have contact numbers for references, employer ets iincase they skip. Take information of their car down including license number. Take picture of their drivers license. Anybody worth their salt willnot object to allof the above. If they do, PASS

    Good Luck
     
  17. halfmile

    halfmile Well-Known Member

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    Oh, yes, by the way, you may have to have an inspection to declare the property fit for rental. They will want insulating jacket on water heater, weatherstripped doors, an electric outlet in every bedroom, the appropriate smoke detector coverage, and other basic stuff. You can not legally rent in my town unless you get this inspection.

    Since you own the place already, you might fly under the radar. Also don't have the hot water heater too hot, you don't want a tenant burned. there is a temperature reccomendation. If the tenant changes the setting, no problem.

    Taking the door off is stupid (consider the source). You can be cited for that and have a fine to pay.

    HM
     
  18. bobdog

    bobdog Active Member

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    Neither a borrower nor a landlord be.

    Best advice my friend the attorney ever gave me. A few years back, I was considering renting a house an hour away, and he told me to consider what it would be like to get a call about a backed up toilet on Christmas Eve, or discovering that your tenants turned out to be trailer trash and several other similar things based on his experiences.

    Then he told me to sell the house and put it into t-bills. I did and he was right, at least as far as I'm concerned. Your mileage may vary.
     
  19. recurvyarcher

    recurvyarcher Well-Known Member

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    Trim Tab gives the advice that I would give. I failed to do most of this in the beginning, and we ended up with the worst nightmare (cabinets yanked from walls, human feces in the closets, literally layers of roaches, and the plumbing loosened and turned on so a lot of the house flooded, etc). It took me 4 months of non-payment to get rid of them because of the way that the renters' protection laws are written in Montgomery County, MD. The police who oversaw the eviction were extremely sympathetic about the situation, and gave me the name of someone who was really good at background checks (both financial and criminal). DO THAT. For kicks, I pulled one on the people that were evicted, and they had all kinds of stuff on both reports. I learned my lesson.

    The potential renters are required to give a fee, which I refund if they pass, for the background checks. The ones that complain and walk away are the ones that you don't want. The ones that have a legitimate financial problems due to divorce, etc., will all-of-a-sudden become honest and open about their situation, and you can decide at that point if you are willing to proceed with their application.

    I do exactly all of the things that trim tab does, and there have been no problems since then. Of course, you do have to be ready for normal wear and tear. Sometimes you get lucky and find someone that keeps the house up better than you do.
     
  20. Bruce Specht

    Bruce Specht Well-Known Member

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    copper, I and my wife owned a 4 flat for ten years. We made a profit every month and like your self I started out taking care of the maintenance around the apartments myself. That proved to be a mistake, either let the tenant do it or get a service here's why. Yes it's good that they see you on a regular basis but you make that provisos in your lease agreement. The right of access with notificaiton, and or to do repairs and maintenace inspections. Make the security deposit twice a months rent and don't become friendly with your renter. You don't want them bothering for every little thing and if they see you making the trip weekly, they will call any time day or night. Give them two sets of keys so they have na extra set. Make sure the keys are marked DO NOT DUPLICATE. If you haven't done things to update remember it is a differnt set of rules when you rent property. Example, in my area all electrical receptacles with in 6ft of a water source or outside need to be GFI's. I put in new receptacales in every kitchen , bath and the basement in our units. Here you need to have a not only smoke detectors but carbon monoxide as well. Do a through credit check and make sure you see picture id. Check for aliases as well. Make provisos in the lease that the tenant covers heat and electric and don't forget to divide the property tax by 12 and add it to the rent. I'm no longer a landlord as after ten years even making a profit every month I'd add enough of calls for I lost my keys the toilet is over flowing, a circuit breaker is out. An hour is a long way at 3AM when the heat is off. Have every thing in good working order and make the tentat responsible for slow running or clogged drains and have the rent sent to a P.O. BOX not your home address. In Illinois getting a no pay tentant out of your property can be a long drawn otu deal. First time the renst late serve notice and start the processof eviciton. Find out the laws in your area for this kind of thing. Bad checks add thrity dollas to cover the expenses that they cause.
     
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