|Posted on November 13, 2016 at 8:29 PM||comments (2)|
As a new investor there are a number of things you need to consider when setting up your business. It is important that you set it up correctly.
1. It is possible to do a few investor deals before you set up a business entity (LLC, S-corporation, or C-Corporation). If you do not have an entity set up you will report your business transactions on a Schedule-C tax form, as a sole proprietorship.
2. There is more than one type of tax on a business. There are four general types which include income tax, excise tax, employment tax and self-employment tax. The type of business you operate and how you set it up will determine what types of taxes you will pay and how you will pay them.
3. Generally you will need an Employer Identification Number (EIN) even if you do not have any employees. The bank wants this number when you set up your business account. If you do not have the EIN number you will have to give the bank your Social Security Number. If you are working as a sole proprietor you do not have to get an EIN number. It is very easy to get an EIN number. Just go onto the IRS.gov website and fill out the form. You will get the number immediately.
4. Keeping good records cannot be overstressed. Good records will save you a lot of money when it comes tax time. In fact, the more you know about taxes the better records you will keep because you understand why you are keeping the records. Even if you are not good at keeping records, Do Not Throw Anything Away! Keep all receipts, even if you only put them in a shoebox and sort through them later. Write little notes and put them the in shoebox also.
5. Every business and every person have to file taxes at least once a year. You may need to file taxes every three months (estimated tax). This is generally the calendar year (January - December). If you have employees you have to pay taxes every time you pay the employees (even if you are the only employee). You do not have to be classified as an employee if you are a sole proprietor and have no employees. When you do have a few employees it is much easier to get an agency that can do that entire employee tax stuff for you. All the details can drive you crazy and keep you from making real money.
6. There are several types of accounting methods. You will need to decide which method you will use. One method is "cash method". In the cash method, for tax purposes, when (the year) you spend the money is the year that it is included in your taxes (income and expenses). The 2nd method is the "accrual method". In this method you deduct the expense when it is really used. Example, if you pay for insurance for 2 years, the deduction will be taken when the insurance is used. You need to do the same method every year. The IRS wants to know if you change your accounting method. Every year there is a question on the IRS form as to if you changed your accounting method.
7. The Economic Substance Doctrine - This is a new revised issue from the IRS. Basically it says that you can't change your business structure just because it will help your tax position. You need to have a real business reason for changing your business. This is why it is even more important that when you set up your business entity and cash or accrual method of accounting. As far as I can find out this doctrine does not apply to a sole proprietorship.
Learn all you can about how taxes will affect you and your new business at http://www.NewTaxChanges4Investors.com/blogTo learn more check out http://www.NewTaxChanges4Investors.com S. Reid PhD
Article Source: http://EzineArticles.com/?expert=Sara_Reid
|Posted on November 2, 2016 at 9:53 AM||comments (1)|
Why No Real Estate Investor Can Live Without An Assistant
By Alan Brymer
Having an assistant is one of the best investments you'll make as a real estate entrepreneur. Like all parts of your business (and yes, buying, leasing, and selling houses is a business), they require an investment of your money and also your time. You'll need to invest a little money in order to hire, train, and compensate them for their
. And, you'll need to invest some time to help them get the job done right-more in the beginning and much less as time goes on.
In exchange for your investment in them, a good assistant will help you to generate much more
than you are paying (bringing you a rate of return that would make any investor jealous). And, they will save you countless hours for every extra hour you spend developing them.
Although many investors are hell-bent on trying to do it all themselves, or think they can't afford one,
here is a partial list of reasons why you absolutely can't live without an assistant:
You will do more deals.
Marketing is probably the best thing to hire an assistant to do. They will help you to execute advertising campaigns that you just would not have gotten around to doing on your own. They can compile lists, print letters, make calls, stuff envelopes, buy supplies, shop around for pricing, and do plenty of other things that generate leads for you that you would not have had the time or inclination to do otherwise.
You will look more professional
. When people receive a call from your assistant, they will know that you are a real player. It makes you look successful, organized, and trustworthy. Your credibility with sellers will increase, which will put them at ease and help you to get more offers accepted. Private lender prospects will acknowledge you as a legitimate business and will feel safer sending money to you knowing that you are not a fly-by-night operation.
You will have less stress in your life
. No one likes drowning in work. One of the worst feelings on earth is to have more work due than you can possibly hope to accomplish in the time available. Having an assistant will take a huge burden off of your back, especially when they do tasks that you don't like doing or are not good at.
You will be able to build a team
. Having an assistant will help you to practice your skills at hiring, training, and managing team members. They are the ideal "starter employee" because they are not difficult to find and can immediately begin doing simple tasks for you. And, there is almost always an immediate use for their help. They will help prepare you to hire other team members when the time comes, if you so desire, such as a salesperson, renovations supervisor, or a purchasing representative.
You will have a better lifestyle
. Isn't this one of the reasons why you got into real estate to begin with? When I started my real estate investment company, I had visions of lying around on the beach somewhere, living the good life while the rent money poured in. Then, I found out there's actually a lot of work involved. A good assistant will give you your life back so you can spend it with your family, working on hobbies, or working on your business (which is always more fun than working in it).
I have hired, trained, and managed personal assistants for years. I would never have experienced all of the
above if I had been stuck trying to do it all myself (and failing). A good personal assistant will not only help you to grow your business-they will give you your life back.
Alan Brymer is the creator of The Assistant Who Pays Their Own Salary, and has been a full-time investor since his first property at the age of 22. His business was named by the Utah Valley Entrepreneurial Forum as one of the "Top 25 Companies Under Five Years Old." To receive a Free copy of The 5 Key Elements to Running a Systematic Real Estate Business, go to http://www.AlanBrymer.com/blog. .
|Posted on September 12, 2016 at 4:06 PM||comments (0)|
Tenant Moved Out Left You Holding The Bag
By Bill Gray
August 10 2009
Perhaps your tenant lied and took advantage of you. He may have skipped out on the lease or you may have evicted him. In either case, he damaged your rental and cost you money! What do you do now?
1. First, set your emotions aside and spend some time organizing your ex-tenant's file. Whether you own one unit or one thousand, or whether you manage your rentals full-time or part-time, you are running a business. Any successful business keeps well organized, complete records.
2. Keep copies of all receipts required to repair the unit, spent on legal fees, unpaid rent, etc. Complete a move-out inspection checklist, preferably with the tenant if possible. Both of you sign the document. The move-out inspection will help you document the condition of your unit and the debt he owes you. If you are not completing move-in inspection checklists now, begin doing so with your next move-in. This important step is often left out because "I didn't have time". Take the time. There is no excuse for not having a complete move-in inspection signed by you and the tenant.
3. A sometimes confusing issue for some landlords is whether or not you may charge through the lease. If the tenant signed a twelve month lease and skipped out or was evicted after only six months, does he owe you for the remaining six months? The short answer is no, not yet. In many states, if you cannot re-rent the unit before the end of the lease, the tenant will owe you the lost rent. However, he does not owe you the rent until it is actually due. Only charge him now for lost rent, as of the date of the move-out statement. If you wish, you may update the amount he owes each month until the unit is re-rented or the lease expires. Discuss this issue with your attorney.
4. Does your lease include termination and/or "no notice" fees? I often hear, "It is in the lease; he has to pay it." The thinking here is that if it is in the lease, it is binding. This is not necessarily true. Termination and no notice fees may be legal in your state, and your tenant may be held responsible for them. With various state laws and recent case law, I highly recommend you have your lease periodically reviewed by an attorney to make sure you are complying with current laws. If legal in your state, termination and no notice fees may be a great way to calculate all charges at the time of move-out, without having to add future rent as it comes due. Again, talk with your attorney about this.
5. Take pictures. A digital camera is important to your business. Move-in pictures are nice to have but move-out pictures are a must have. The checklist and pictures not only help document the condition of the unit, but they may be helpful later if the tenant gets creative with his description of the condition when he moved in and when he moved out.
6. Keep a log of all communications you have with your tenant, especially any communication regarding him moving or paying his rent. If you do not have a log, begin using one immediately for all your present and future tenants.
7. Once you have your records together, complete a move-out statement. Most likely your management software will do this for you. The move-out statement should include the names of everyone who signed the lease, the unit address, move-in and move-out dates, and a break down of the charges. If a deposit was placed on the unit, you will show the deposit subtracted from the total due. State laws vary on what, how, and when you are required to notify the tenant of how you applied his deposit. Follow the law to the letter. Not doing so will give your debtor the upper hand, and you may be required to repay his deposit even though he actually owes you money! Some states require that this move-out statement be mailed certified mail within a certain number of days of move-out. Keep your certified mail receipt with your records. You may need proof that you complied with the law. Mail the move-out statement to your debtor at his last known address. This may be the address of your rental unit. If the letter is returned un-received, keep it in the file also.
8. A word of caution here: Some landlords are tempted to pile on and exaggerate the charges. While tempting, it will do you no good in the end, and it is not legal. Being fair and reasonable in your charges will greatly increase your chances of recovering the debt.
9. Now that you have your documents organized and have mailed the move-out statement, do not just put the file away somewhere and forget it. The money you are owed is an asset. I cannot tell you how many times I have heard the comment, "That bum will never pay his bill!" I can tell you with confidence that this way of thinking is costing landlords millions of dollars a year in lost profit. With little time and effort on your part, you may collect all or part of what you are owed.
I can help you with this collection process.
Bill Gray www.thelandlorddoctor.com [email protected]
|Posted on August 15, 2015 at 7:23 AM||comments (0)|
5 Hints To Help You Be A Better Landlord
By Michael Barnes
December 5 2009
Are you a landlord? Do you want to be? Do you or are you planning on buying residential property to use as rentals?
Well if you answered yes to any of the above, this article is for you.
First let me start out with the cold hard truth, being a landlord does not mean just collecting a rent check once a month and spending the rest of your time on the golf course. Being a landlord can be frustrating and can take a lot of effort.
The other truth though, is that if done right, being a landlord can be fun and rewarding, both personally rewarding and financially rewarding.
The key is to know what you are doing and take your job seriously.
Here are 5 tips that I have picked up through the years dealing with my portfolio of rental properties.
1 - HAVE A WRITTEN LEASE
A written lease is CRITICAL; I can not stress this enough. A written lease protects you and your tenants and prevents potential misunderstandings from become nightmares. There are tons of places online where you can get sample leases for your state. Do not skimp or take a shortcut on this. It will only take one time for your lease to save you and it will have more than made the time you spent putting it together worthwhile.
2 - KNOW THE LAW
While it is always good to have a competent attorney available to you, it still does not eliminate the need for you to know the laws in your state regarding residential tenancies. Take the time and read and understand the laws as they pertain to you. Just as with the lease, all it takes is one time where your knowledge of the law kept you out of trouble, and your investment of time and research will pay off handsomely.
3 - BE FRIENDLY, FAIR & FIRM
One of the things that I have learned is a key part of my success is how I treat my customers (tenants). I have tenants from all walks of life, all economic situations, all races, colors, religious, you name it. One thing that they all will say is regardless of what may make them different, I treat everyone the same. This is not only because there are laws against certain types of discrimination, but because it builds a stronger relationship with my customer. Along those same lines though, I am also firm. I am clear from the beginning about how I handle late fees, and other expectations. I do not waiver from this.
4 - BE VISIBLE
This one can be hard if you are a part time landlord, or have properties spread out over a large area. I find it useful to be visible to my tenants and the neighbors of my properties. I make it a point whenever I am in a part of town where I have properties, I drive by them. If I see someone outside I stop and say hi, if I see a neighbor that I have spoken to before, I say hi to them. This helps in a number of ways; first, it lets your tenants know you care about the property. Being visible also helps to build relationships with neighbors, which can be a great set of eyes and ears to tip you off about any problems before they get out of control.
5 - NEVER FORGET YOU AND YOUR FAMILY COME FIRST
This is probably one of the hardest lessons a landlord must learn. First, ask yourself why did you or are you getting into the rental business? The answer is obvious, you want to make money. Money either for current use or to build a nest egg for later. As a landlord you will be presented with a variety of stories and excuses. Some of these will be true and others may not be. I have found it is easier to deal with the people telling you a story that is just an out and out lie. I have no trouble not showing any compassion and simply boiling it all down for them to a simple truth, "You do not pay, you do not stay". The stories that are true are actually the difficult ones. I can not tell you how to handle every situation, and each of us is different in our thoughts and beliefs. I can tell you this, as you evaluate how to handle the situation, never loose sight of the fact that the needs of you and your family HAVE TO COME FIRST.
Michael Barnes - <a target="_blank" ["rel=\"nofollow\" "]href="http://www.trailerparkriches.com">http://www.trailerparkriches.com</a> - <a target="_blank" ["rel=\"nofollow\" "]href="http://www.landlordtutor.com">http://www.landlordtutor.com</a>.
|Posted on March 22, 2014 at 9:18 AM||comments (4)|
By Teo Zhenjie
March 29 2009
Whether you are a landlord or property manager, you'll find that accounting for leases will end up becoming one of your most important duties. Do you always take the time and effort to keep track of all of that money coming in and out, and are you diligent about it?
The truth of the matter is that there are plenty of landlords and rental property investors out there that are simply less on task about this subject than they should be, and at the end of the day, this is something that will very easily come back around and bite them when they least expect it.
It doesn't matter how large or small is your rental property is. You cannot simply stuff all of your receipts into a folder somewhere and forget them or you will end up doing yourself a grave disservice. What sort of problems might you face if you are lax about accounting for leases?
Rental Accounting Enables You to Keep an Eye on Your Tenants
One big advantage that you have when you look at having good record keeping for your rental property has to do with keeping good track of your tenants. Do you know who pays reliably and on time and who does not? This can make a big difference when a tenant asks for reprieve and what your decision should be.
The more organized you are, the happier your tenants are going to be. No one likes to live in a place where they feel that their money is being handled frivolously, and by keeping good records, you are showing them how responsible you are. Give them professional courtesy and professional treatment in this respect.
Accounting Allows You to Handle Your Taxes and Cash Flow Smoothly
Another thing that you will discover is that the better your accounting is, the more likely you are to have a good experience when paying your taxes. Even if you are not worried about an audit, you'll find that preparing your taxes and your paperwork for such tasks are going to be much easier.
Whether we like it or not, money is something that is very important to keep track of. Don't fall into a place where you need to worry about not knowing where your money is going to go. If you perpetually wind up short at the end of the month, it may be because of poor bookkeeping. Don't let this happen to you.
Accurate Figures Allows You to Make Sound Investment Decisions
Also be aware that when you keep good track of your leases that you are going to be able to make much better decisions for the future. For instance, are you in a place where you can move forward and expand? Good accounting for leases that you hold can tell you what is possible and what is not.
Your property taxes are not a laughing matter. They are one of the most important aspects of holding rental property. By making sure that you know what your rental cash flow is, you are going to find that you are in a much better place to deal with them.
Don't fall behind on accounting for leases; there is a lot riding on you keeping good books!
Teo Zhenjie has been showing landlords how to manage their tenants and rental property effectively on Propertydo ( http://www.propertydo.com/ ). Visit his website today for step-by-step real estate guides, free resources and forms. Click here for more important tips on accounting for leases:http://www.propertydo.com/accounting-for-leases.html.
|Posted on July 26, 2013 at 1:01 PM||comments (9)|
By James Miller
January 24 2009
1) Make them part of the solution
When I get a request for something the that a tenant wants done, but I feel doesn't need to be done. I will often times make them part of the solution. I am not talking about things like a tenant being without ot water, or a broken window, but instead items like repainting a room, or in the instance I am about to describe, a screen door.
We had tenants that were in the middle of their second year with us. They had requested a new screen door as the existing one wasn't shutting easily and was banged up. I had just put a new screen door on before they moved in and felt that much of the damage had been due to their use/abuse. I hadn't installed a cheap $69 dollar door that I would expect to wear out in that short if time either. While I did point this out to them, I never got confrontational about it. I instead agreed to let them have a new door, but on the condition that they must pick it up from the store and install it themselves. I agreed to let them pick out the style of door and only limited them to a max of $200 for the door. They agreed to this and I went on my way.
It took them
to get the new door installed.
If you can involve tenants in some aspect of a repair or fix of their complainant, particularly if you can make the part you do contingent on them completing some action, most of them will drag their feet on it, and about 1/3 of them will never even get around to getting their part done.
What would have happened if I had felt fully responsible for the door and agreed to get them a new one?
I can tell you from experience that they would have been calling every two days asking how the door was coming along and when it was going to get done. I wouldn't blame them for this, if I had said I was going to do it, they should hold me accountable.
I was able to avoid this, not even having to think about the door by making them part of the solution. They can't really complain as I had agreed to give them what they want, it was just up to them to get it done.
As a side note, I find it a common for tenants to find something to complain about, or want fixed, at about the same time they have to write out the rent check. I think this either comes about for one of two reasons. They are reminded that they have a landlord when writing the check, so they make a point to call me at that time, or more likely, that they feel the pain of writing the check and that they need to get something more in exchange for it.
2) The power of the third party
When I get a request for something that I know I am going to say "no" to, instead of immediately refusing to the request, I will tell them that I have to talk to my partner about it. I do actually have a partner in all of my investments that have tenants. It is my Brother.
While the tenants may see him with me working on a repair from time to time, what they don't know is that he is the biggest, nicest, pushover teddy bear that ever lived. If I indeed did have to ask him for something, I am certain to get it. He isn't a fool, he is in fact one of the smartest guys I know, but he really doesn't like conflict.
Now as far as the tenants know, he is the tightfisted ogre who watches the books, refusing every request with a big red stamp. In their minds I am deathly afraid of asking him for anything.
By positioning him in their minds this way, it actually helps my relationship with tenants as we "team up" and it is now the tenant and I vs my tightfisted brother. They feel as though I am lobbying for them.
While this may seem underhanded please know that I do not do this for legitimate requests, or to skirt anything necessary. It is, in fact, most often used when I am asking them for late rent.
It is usually a "Hey I hate to be such a hard ass, but my brother was wondering why we don't have rent from you yet." Kind of thing.
They now see their failure to pay rent as getting me in trouble as well, and that they are letting me down.
3) Keep your promises
If you say you are going to do something, you do it. This makes you solid and reliable in the mind of the tenants. It also gives them little to complain about especially when it comes to reasons not to pay their rent. These reasons are not always verbalized, but may just be an internal dialog that occurs once a month when their pen hits the checkbook.
4) Respond to their requests quickly
This goes hand in hand with keeping your promises. Respond to them in a timely manner and they have no reason to feel you are not putting your best foot forward when it comes to taking care of them. It doesn't always mean that you will do everything what they want, but taking the time out of your schedule to talk with them can often be all they really need anyway.
5) Don't be their friend
You should be firm but friendly. If you feel you have to send them a card or present for the holidays, you are in too deep. It is easy for a tenant who feels close to you to feel that you will cut them some slack when it comes to paying rent late or getting special treatmentâ€¦. And it's probably true. The best bet is not to get in that situation on the first place. If you can swing it, a management company is a great way to have a natural barrier between yourself and your tenants. A management company is not always a possibility when starting out. I would recommend that you manage the first few properties you buy yourself anyway.
6) Seek first to understand, then to be understood.
This is a Steven Covey thing, but works really well with dealing with most people in general. People want to be heard and understood before you start talking. It doesn't mean that you will go along, or believe what they say. It mainly means that you hear them out.
When I ask tenants about why the rent hasn't been paid yet, I really only care about two things, when they are going to get me a payment, and How much they are going to pay me when they do. Everything else they say means very little to my business. I am not heartless, if there has been a death in the family, or some medical emergency, I do have empathy for them, but from a business standpoint, I need to involve myself in their situation about as much as Visa or MasterCard cares about me.
I do, however, force myself to patiently listed to how the car broke down and they had to fix that, or how the cel phone bill was more than they thought, or how some other thing that they inappropriately label as an "emergency" took priority over the rent payment.
I do this despite the fact that a rent payment is one of the few payments in their life that both comes at the same time each month and is in the very same amount each month. I have always thought that these two factors should make it relatively easy to plan for it, but am frequently disappointed.
7) When they stop paying, act quickly.
This may not help you to get on the tenants good side, they all want you to cut them some slack, but I have talked to many landlords who want me to tell them how to get the money that the tenant owes them back. One lady had tenants that were into her for back rent alone of over $6000. Unless their rent was incredibly high, the only way for a tenant to get in this far is if you are burying your head in the sand and pretending things will get better as they continue to fail to pay you each month.
If they can't pay for the current month, they aren't going to be able to pay for two months rent next month. You need to take action immediately. Even after all is said and done and you get a judgment against them, the odds of getting your money back in any sort of timely fashion are very low. While it sucks to evict and to have to re-rent the apartment, you need to cut your losses at the first sign of trouble. If they can get caught back up, they will once they get a hand delivered "pay or quit" notice from the police.
James is a real estate investor in the Southwest Wisconsin area. He has been investing in real estate for 13 years in both residential and commercial property. He enjoys talking with those just starting out and can be reached at [email protected] Other articles by James can be found at: http://realestategozone.wordpress.com
|Posted on April 25, 2013 at 7:32 AM||comments (0)|
Perfecting Your Tenant Pet Policy
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Many a landlord shuns tenants with pets due to the increasing likelihood of repairs or maintenance down the road. Itâ€™s also more of a burden on the landlord to rewrite the tenant pet agreement, thus accommodating such pets.
However, given the economy itâ€™s wise as a landlord to keep an open mind to renters with pets. Many would-be tenants are more likely to seek out tenant pet agreements that allow them to keep their pets, rather than getting rid of them for a short-term living situation.
Vacancy rates aside, it's nonetheless easy to understand any landlord's reluctance to allow pets. Animals open a unit up to more potential damages and can cause noise and safety issues in a complex, not to mention a host of other problems that are often simply not worth the hassle. However, while there are a number of valid reasons to ban pets, thereâ€™s also a few good reasons to allow them; namely, it open up your potential pool of tenants and allows you to increase your rental rates.
Here are some considerations that can be used if you do decide to allow pets.
In closing, if you do allow pets youâ€™ll most likely lower your vacancy rates and exploit a new tenant population in need of housing. Also, there are websites such as DogHouseProperties.com or PeopleWithPets.com, in which you can post your pet-friendly rental listing to increase visibility with pet owners. EzLandlordForms.com also has an editable Tenant Pet Agreement, which can be signed between the landlord and tenant.
|Posted on April 21, 2013 at 9:00 AM||comments (0)|
By Jason Hanson
January 28 2010
Almost every year property expenses increase. Your insurance goes up, your taxes go up and if your property is in an HOA, your HOA dues go up. And since we're in business to make money it's necessary to increase rental amounts every year.
Sadly, I know many investors who are so afraid of ticking off their tenants that they haven't increased rents in years. But think about it this way: It's much better to raise the rent $30-50 a month every year, versus waiting forever and all of the sudden raising the rents $200 a month.
So how do I raise the rent every year on my tenants? Well first, I raise it about 5% a year. I do this by sending my tenants a letter about two months before the rent increase takes effect.
Now, you want to see this letter right? Good. Below is the exact letter that I send to my tenants every year. Thanks to this letter I've never had a tenant balk over a rental increase. You have my permission to use it and to start increasing your cash flow today.
123 Main St.
Manassas, VA 20110
The time of the year has come when it is time to renew your lease. I want to continue to have you as a resident, and appreciate how friendly and easy you are to work with. Thank you so much for paying your rent on time every month and taking such great care of the property.
As you can imagine, over the last year my expenses on the property have increased because of taxes, insurance and inflation (especially the HOA fee which is over $200.00 a month).
Anyways, I am swallowing most of the fees since I enjoy having you as a resident and the good news is that your rent is only slightly increasing. I want to make the payments as low as possible and the rent is only increasing $40.00 a month. Your new monthly rent amount will be $1,240.00, effective December 1, 20XX. If you have any questions about this, please feel free to give me a call. I look forward to having you as a resident for a long time.
P.S. I have included a new lease for the upcoming year. Please read it over and sign it, where I have highlighted in yellow, then mail it back to me (this is the same lease you signed last year, nothing has changed except the dates and new rent amount). Please don't forget to initial the bottom of each page. Checks will continue to be made to ABC Realty Group, LLC and sent to the same P.O. Box.
Jason R. Hanson is the founder of National Real Estate Investor Month, author of "How to Build a Real Estate Empire" and mentor to students all across America. To get a FREE copy of Jason's Special Report "The Insider's Guide To Buying Your First Investment Property in 83 Days or Less!" visit http://www.PrimoCoach.com or call 800-865-1702. .
The author has permitted the reprinting and redistribution of this article.
|Posted on March 24, 2013 at 10:22 AM||comments (0)|
How to Start the Eviction Process and Make Tenants Pay Rent Or Leave
Send a Late Notice
For the eviction process, you should send a late notice. Judges like to see that. They want to see that you've at least tried to work things out. Most states are going to require you to send some sort of notice to warn the tenant and give them the opportunity to correct the situation. Then you begin the eviction.
Money Judgments and Non-Monetary Issues
There are two types of things when you go to start an eviction that you're going to be seeking. You're going to be seeking a money judgment for unpaid rent. Maybe the tenant owes $2,000. You would be seeking a money judgment for $2,000.
Now, if the tenant has breached the lease for a non-monetary issue, for example maybe they keep making noise at night, you can declare a breach under the lease and try to evict for non-monetary issues also. You can obviously evict for non-payment, but you could also evict for a breach of the lease.
The breach can be any number of things: loud music, not putting the trash out, drugs, or if the police were reporting drug activity, so there are a number of ways that a tenant could breach a lease. Damages to the apartment are all non-monetary breaches. You would be going for a money judgment or a breach of the lease.
Possession of Property
Also, the second half of that is you are going to be looking for possession of your apartment or property back. So you've got damages through monetary damages or breach of the lease and then you're going to have possession.
The typical way the court works is you file the paperwork with the courts and pay the fee of course, and then the court will schedule a date for the hearing. They will notify the tenants of the date and the time. At that point, the tenant may reach out to you during that period and try to work things out. If they do, that's wonderful if you can get the money at that point.
Keep in mind that you've now spent $100 or $150 in court costs and make sure you add that to whatever cost that the tenant owes, because what you don't want to do is have them pay all the rent and then the court's not giving your money back because you worked things out. It's non-refundable. Make sure you add that to whatever monies you work out with the tenant.
I invite you to learn more about Property Management and get a free 60 minute audio titled "Learn the 10 Success Secrets of Property Management Every Real Estate Investor Must Know to Maximum Profit and Avoiding Tenant Headaches" by going to http://www.realestatewealthtoday.com/PMS.html.
Mike Lautensack is the owner of Del Val Property Management LLC, a FULL service residential property management company located in Philadelphia, PA.
|Posted on March 13, 2013 at 10:11 AM||comments (0)|
What Makes YOU a Good Landlord?
1. Understanding the need for quality tenant screening
"It is far better to have no tenant than to have a bad tenant."
A crucial aspect of screening tenants involves using a good rental application and other forms that focus on determining how qualified the applicant is while legally protecting the landlord. Forms such as the Tenant Finder Worksheet and the Tenant Finder Qualifying Chart can be very helpful after you have verified the information given to you on the rental application.
I'm surprised at how many landlords don't actually make calls to check the references on the rental application! Once I had a landlord reference start laughing when I called. I asked what was so funny. He said, "I can't believe this guy was stupid enough to list me as a reference! He is being evicted as we speak." I highly recommend the Landlord Reference Qualifier as a tool for determining the integrity of the landlord reference the tenant gives you. A 2 minute phone call can save you thousands!
The next step in verifying the references on the signed application that also includes authorization to verify the applicant's credit is to order a credit report. Landlords without access to pull instant credit reports are at a disadvantage when it comes to making timely decisions on accepting tenants. If you do not have access to instant credit reports, I recommend The LPA's credit report agency, Quick Check Credit Reports.
After a while in the landlord business, showing rental properties to many tenants, you tend to hear some of the same questions and statements again and again. The screening process is alive from the moment you first speak with your new prospects until the leases are signed and the money is paid, so you must keep your eyes and ears open for clues and telltale signs of whether your prospect is the right tenant for your rental.
I use a basic little chart on my internet rental ads that has made quite a difference in setting up appointments. I used to advertise in local newspapers, and spend thousands on rental ads, but websites like Craigslist and The LPA Rentals Available section have been a helpful way to save advertising dollars! Just imagine receiving e-mails from prospective tenants with the pre-screening information you want before even talking to them. (With Craigslist, the customer doesn't even have to see your real e-mail address or phone number!) Call prospective tenants to set up appointments only if they meet your pre-screening qualifications! It has never been easier. It saves time, advertising money and helps you zero in on the tenant you're looking for... Click to for your Free HTML code and also Free Download of the printable Prospect Card
Many of us have had difficulty in rejecting interested rental applicants for our properties. Without a system to save you from legal entanglements, wasted time and aggravation, hurt feelings and embarrassment, you are going to be one unhappy
person. Having a legal and effective approval and denial system for your rental application process is essential if you are going to last in the landlord business.
2. Preparing Qualified Tenants with a Good Lease Agreement
outlines in detail what is expected from tenant who will treat the property with pride and respect. If possible, the lease should be
read and explained to the tenant in person.
It is more effective that way. After all, the lease agreement is an instruction manual for how to be your tenant in your rental property. Before turning over a valuable asset for a mere 1 or 2 month security deposit, make sure the tenants understand and agree to all your terms. You'd be surprised at how many people are so eager to just sign the lease without bothering to read it. You can get a real idea of what these people will be like as tenants by how they respond to the terms in your lease.
3. Providing a Quality Rental
That is usually an indicator of what your standards of quality are for your tenants. Simply put: If you want to attract good tenants, you need to provide a quality rental.
4. Lease Enforcement
Maybe in the Twilight Zone, but in reality a good landlord is equipped to enforce the lease agreement.It is common for tenants to forget all that stuff they agreed to in the lease. Many tenants misplace or file away the lease the same day they signed it without giving it a second thought. That is why a good landlord is ready to nip potential tenant problems in the bud with good lease enforcement forms. Many of the LPA's
were written to focus on that exact purpose: "
5. A Good Landlord is Not Greedy
The stereotypical bad landlord is usually depicted as a greedy, mean old slumlord like Mr. Potter from "It's a Wonderful Life". Be generous whenever possible. "What goes around comes around". You'll retain good tenants longer if you price your rentals competitively.
About the author:
As a Real Estate broker / investor in New York, John Nuzzolese has been involved with rentals and investment property since 1979. Besides owning and operating two real estate businesses, he is president and founder of The Landlord Protection Agency, Inc. , an organization specializing in helping landlords and property managers avoid the hurdles and pitfalls and expensive blunders common when dealing with tenants.
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