Secrets of Being a Successful Landlord – Part 2

So now your tenant is all moved into your unit. When a tenant moves into one of my units, I provide them an inspection sheet that goes over the condition of all parts of the unit (paint, doors, appliances, etc) which they sign off on stating that they agree to the condition of the unit when they moved in. We give our tenants fifteen days to go through the unit to see if there are any repairs needed that may have been missed by my rehab crew. These repairs are done at no charge to the tenant. After fifteen days, the tenant is charged the first sixty five dollars of all repairs. This keeps the tenant from calling us to repair small items like toilet guts for instance.

I actually added this to our lease after a tenant called us at 6:30 one evening to tell us her kitchen sink was stopped up. It turned out that her small child had stuck a cup down into the garbage disposal. It just needed to be removed. The way my lease reads now, that tenant would be charged a fee of $65.00 to have my repair guy go out for something that wasn’t a repair. This one clause will save you from a lot of unnecessary trips to your units for repairs.

I also have someone who checks my rental units every sixty days or so to make sure they are being cared for properly and that the tenant has not added animals that are not on the lease. We also make sure they have not moved in any more people who are not on the lease. This is grounds for immediate eviction. Within the body of our lease, we also cover how long visitors can stay as well so there is a clear definition as to what a visitor is and what an extra tenant is. You can also hire a property management company to handle your units, but I just feel like our units are better handled by my staff. I also send letters to the neighbors surrounding my rental units letting them know that we are interested in any input they may have about my units and my tenants. The neighbors become kind of a watchdog for me to let me know if there are any problems I should know about.

When a repair is necessary, I have my vendor contact the tenant directly to set up a time for the repair. This keeps me out of the middle of the situation. My vendor then calls me to let me know what repairs are needed and to get my authorization to do them. If you build a solid tenant base and your tenants have been in your units for a long period of time, these matters become very easy to handle since your tenants are well aware of your policies regarding repairs. At this point in time, most of my tenants have been in my units for several years. I believe there are two reasons for this longevity. One is that while we are strict with our tenants, we are fair with our tenants. The other is that our tenants know exactly what is expected of them and they live in clean, well maintained units. When they do have a legitimate problem, they know it will be handled expediently.

We also cover what maintenance to the unit the tenant is responsible for. For example, they are responsible for keeping their yard mowed and shrubs trimmed. You could also provide this service for them and charge an extra amount of rent monthly to cover it. Our tenants are responsible for their own utilities as well. We are also very clear as to what is required upon move out, which basically is that the unit looks just like it did when they moved in. We outline the specifics of what we expect to be done, such as the yard being mowed, appliances and carpets cleaned, etc. This just makes it very clear for everyone. Upon move-out, we do an inspection and provide written documentation to our tenants concerning any items we find problems with. We give them a specific timeframe to correct the problems before withholding monies from the security deposit. As I mentioned before, being a landlord doesn’t have to be that difficult as long you set up a specific plan for your business and stick to it.

From time to time, you will have a situation arise where you will have to evict a tenant. The first thing I do is to serve the tenant with a 3 day notice, which is required by our state laws. At that point I fax a copy of the lease and the three day notice to the attorney I use to handle these matters for us.

Sometimes the tenant will make up the back rent within the three day period and the eviction process stops there. Other times you will have to take the eviction process through the court system. I will give you a good piece of advice here. Even if your tenant moves out in the meantime, you need to finish out the eviction process. Otherwise your tenant could just try to move right back into your unit. The other piece of advice I would give you here is that you need to let an attorney handle these evictions for you. They are tedious, time consuming and require proper paperwork. In addition, the attorney doesn’t have any emotion involved in the situation like you may. Just let them do their job for you. This is also another way to automate systems in your business.

It is also clear within the body of my lease that the tenant loses whatever rents or deposits I am holding if I have to evict and that they are liable for any legal or collection costs involved in the eviction process. This makes it easier for you to get a judgment against your tenant. I also follow through with a judgment for damages to the property.

Personally, I always follow through with getting the judgment because I want the eviction to show up on public record. I wouldn’t want another landlord to have to go through whatever I had to go through with this particular tenant. In addition, we usually end up eventually getting paid on our judgments.

Running a rental business and having tenants in your properties doesn’t have to be drudgery. If you follow a few simple steps to insure that things run smoothly, you can have a very successful rental business.

For more information on marketing to motivated sellers, exit strategies and running your rental business, visit my website at www.marketingmagiclady.com.