When you’re just getting started as a new landlord and buying your first rental property, the learning curve is very high. There is an enormous amount of information to find, read and gather before you take the plunge. Some examples include doing a property analysis before buying, all aspects of managing your rental and how to deal with problems as they arise. All of the information you could ever need is available online but it’s time consuming to sift through it all to find the useful articles and true expert landlords that can help you along the way. It took me many years to find everything I needed and create a system for myself to keep my rental property business running smoothly.
What starts out as a difficult task though, soon becomes a joy as your confidence grows, your rental business grows and you see a significant increase in your net worth. Eventually you will know more about buying and managing rental properties than you ever dreamed possible. You might think at that point you’ll sit back and relax and let things take care of themselves for a while but that hasn’t been my experience at all. Even after many years of being a landlord and managing my rental properties, I still visit rental sites and blogs regularly both to find information and opinions or offer my own. I remember exactly what it was like when I was just starting out and all of the fear and uncertainty that I experienced. Now I use that to help and encourage new landlords that are just getting started, just as it was done for me in the past.
My best advice to everyone reading is to always keep learning. If you’re at the beginning of a new venture, it doesn’t have to be daunting. Buy one book, take one course, visit one blog…eventually it will start to feed on itself and then watch out! You’ll be unstoppable.
To your success!
A lot of new landlords getting into buy and hold real estate try to acquire as many properties as they possibly can. They realize that real estate can be a lucrative business – especially over the long term and they want to capitalize on it as much as possible. More so once they’ve overcome their fears, gotten their feet wet by buying a rental property or two and feel more confident about what they’re doing.
A lot of “would be” landlords think they have to follow this philosophy too. Once they’ve decided that this is where they are going to invest some or all of their savings, they feel like they will need to acquire as many “doors” as possible to make it a worthwhile venture.
Let’s face it, this can be daunting to someone just starting out in real estate investing. Not only fear of taking the plunge and buying their first property but fear of then having to build a real estate empire.
Most people are also thinking, “I’m already so busy, how will I manage this all?” With kids, a job and a million activities, it’s hard to become a property manager as well. And unless you start off with a lot of positive cash flow (difficult), you will need to keep a day job and manage the property or properties yourself.
The point of all of this is – you don’t need an empire or the stress of thinking you need an empire. Even one rental property puts you way ahead of the game and on the road to financial freedom. Then you can decide if you want another or if you want to put other investment money elsewhere.
Managing 1 or 2 properties yourself is completely doable, even with a whole other life. I’m married with 2 very busy kids, a guinea pig and I work a lot. But I manage 2 residential properties and 1 commercial property with minimal stress and few issues. I started with one, figured everything out and then bought another one a couple of years later. A year after that I was approached about buying a commercial warehouse and I knew I could take that on as well. And to be honest, that’s good for me. I like having time to spend with my family and working on my other ventures and I feel GREAT having these 3 appreciating assets being paid off for me while I do that. You will too – so take the plunge and stay calm…it will all go great!
While writing my blog I go back and forth between the terms “beginner landlord” and “novice landlord” to describe someone that is just starting out in real estate. Beginner landlord doesn’t sound quite right to me but it seems like a much more common word than novice. Eventually I just looked up the true meanings:
Beginner: person unskilled in something.
Novice: person just learning something.
Novice is way better as you are learning new things as we speak just by being on a rental property site. Although this post isn’t all that helpful:), just be happy knowing you’re a novice…one step up!
Rental properties come with expenses. Some are big, some are small, some are expected and some come as a big surprise but there is always something that comes up so landlords need to be prepared.
Here are some of the more common expenses that a landlord can expect with their rental properties:
So, why is it so important to repair and maintain your properties? First, your tenants are paying off your investment so they deserve to live in a property that is safe, secure and has everything in good working order. Second, a good landlord that responds promptly to requests for maintenance will be much more successful in building long term tenant relationships which are the cornerstone of a good rental property business. Third, looking after your properties will also add value to your investment as your property values continue to rise with these improvements, repairs and maintenance.
If you’re like most people, you likely don’t have a lot of extra cash on hand every month but that should never stop you from looking after your investment. Ignoring problems can and will lead to run down properties and a lower grade of tenant.
There are two key ways to overcome the problem of unexpected expenses. The first is to try and build a reserve fund from your monthly rents. If you have any surplus after your bills are paid each month, put this aside to cover these expenses. The second is to have access to credit. Putting a line of credit in place for these expenses will give you piece of mind that you can handle the unexpected and with interest rates so low, you can pay it back quite easily in small increments.
For new landlords, there are always fears and uncertainties when buying that first property. Anything that can be put in place to ease those fears is a good thing and will be so helpful in moving the dream into a reality. To your success!
As a landlord, whether you are just starting out or have years of experience, there are always going to be bumps in the road. You can be well organized, prepared and have all the best systems in place but eventually there will be a crack in the armor. And when these cracks appear, how you handle them is what matters most.
The truth is, some tenants are very savvy and have made lying an art form. When they get past your radar and take up residence they can make your life very difficult until you can remove them. Sometimes the rental property you purchased turns out to be a bit of a money pit with far more expenses than you anticipated. Occasionally, everything seems to happen at once with one property remaining vacant for an extra month or two and another with some major repairs that need to be done putting a real tax on your finances.
When disaster strikes, it’s easy to think “owning a rental property sucks” and “my friends were right – why did I ever think this was a good idea? Dealing with tenants is a nightmare”. Getting caught up in that type of thinking tends to spiral and the next thing you know you’ve sold your rental property and are now advising people yourself not to do it – it’s not worth it.
Here’s some advice that comes from experience. The best solution for any problem related to your rental property (and life too for that matter) is acceptance. S*^t happens. Things don’t always go according to plan. Sometimes they’re so far off the plan that you can’t even remember what the plan is. It is what it is so the best thing you can do is deal with it, learn from it and add it to your wealth of experience to help you with things in the future. Don’t rail, don’t freak out, don’t give up. Take it in stride, do what you need to do to fix what you can at that point in time and stick to your long term plans and goals.
Despite all the bumps in the road – owning rental properties is one of the best decisions you have ever made and it will go a long way to increasing your wealth and helping you achieve your financial goals. Deal with things as they come, don’t dwell on the past and don’t anticipate bad things coming in the future. Owning a rental property makes you far better off than the majority of the population so hats off to you! Good things will always come your way.
Sometimes you have to ride over the bumps in the road to avoid running off a cliff. Other times you may have to fall into the potholes to avoid hitting the trees. Some days you have to experience the wrong turns, to recognize the right ones. There is no better navigation system than bad experiences in life so that we can recalculate our lives through better choices to reach our intended destination. Eugene Nathaniel Butler
To your success!
Creating a good, positive relationship with your tenants is very important. Tenants are the backbone of a successful rental property business so building and nurturing that relationship will contribute to a landlord’s success. One of the best ways that I know to help accomplish this is to make your tenant’s life as easy as possible while they live in your property.
When it comes to “who should do what” between tenants and landlords, conflict often arises unless your expectations are clear from the start. Begin with the lease agreement where you can list things like the rent and when it is due, how it is going to be paid, late payment penalties, rules regarding guests, minor repair expectations and utility agreements. Review the lease with the tenant page by page and have them initial that they have read it and understand your rules.
Continue by leaving a tenant binder in each of your properties. The binder can include emergency numbers so that the tenant knows who to call for a gas leak or power outage. It should include yard expectations like lawn mowing and snow removal. It can also include a move out checklist so the tenant knows what you expect in order to receive their security deposit back.
Throughout the tenancy, there are lots of things you can do to make a tenant’s life simpler. Let’s start with the yard. If you want the yard to look nice and you don’t want your house to look like a “rental” – then make the yard very low maintenance. Apart from basic lawn mowing and snow shoveling, most tenant’s will not spend extra time on the yard. Let’s face it – it’s not their yard so there’s no pride of ownership. Not in my experience anyways. If you have to have any plants at all – make them perennials. Surround them with thick black gardening cloth that makes it hard for weeds to peek through and then cover that with rocks. Do the same around any trees. Providing a container of weed killer might inspire a tenant to use it but it’s not likely so try to slow down those weeds on your own. Another thing you can do is have a professional company come once or twice in the summer and spray the lawn with fertilizer and weed control.
Another handy trick to make a tenant’s life easier is to either install a keybox or put keyless entry locks on the outside doors. This will prevent you having to run over in the middle of the night (or ever) for tenant’s who have lost their keys. The code can be changed on the keybox the next day when you return the key and keyless lock codes can be changed with each new tenant.
These are just a few ideas to help you establish and maintain great relationships with your tenants. Do you have any other ideas you’d like to share about how you make your tenant’s lives easier?
This topic often comes as a surprise to new landlords. When they are trying to attract new tenants they think that low rent or other incentives will bring more prospects. The truth of the matter is that, low rent or not, everyone wants to feel safe and secure in their home. Especially when prospective tenants have children. Often times, given a choice between two rental units, tenants will choose to pay a little more if they feel their family will be safer in one unit over the other.
We live in a day and age where fear is very prevalent among us all. Our constant exposure to news stories and headlines coupled with the news maker’s focus on murder, violence, guns and all other manner of horrific death makes a lot of people very wary of the outside world. Things are usually not half as bad as we think but the constant focus on all the bad in the world leads us to believe that there’s evil around every corner. I could go on and on about this but suffice it to say, it’s only going to get worse as we are exposed to more and more ways to view this information. The silver lining in all of this is that it gives landlords a definite edge if they can dispel these fears by creating a secure living space for people.
So how can you set yourself apart and attract more tenants to your rentals, thus giving you more quality tenants to choose from? Start right in your ad, mentioning the safety and security of your house or building. Then make sure everything is in place to follow through on those promises. Have good strong doors, deadbolt locks, locking windows that are in good repair and extra reinforcement on ground level windows. Make sure hand rails are sturdy and put non slip adhesives in the bottom of your tubs. To ensure against fire, check that all smoke alarms are in working order, have any fireplaces inspected and take the extra step of providing a fire extinguisher. Make sure your property is well lit on the outside including motion sensor lights where needed. Add key locks to the gates in the yard.
Some of these steps may seem obvious and some might seem overboard but put them all together and they present a great picture to a prospective tenant. You are now a landlord that cares about their safety and you’re willing to take extra steps to show them that you care about their well being. When someone is out shopping for a place to live, seeing flimsy doors and windows and no attention to detail where safety is concerned, your place will look like a haven and a higher rent will seem trivial when a tenant feels like they and their family will be safe.
Do you have other ideas to make your property more secure? Feel free to comment on this post as I think this is an important topic and one that will be very helpful for any landlord looking to attract quality tenants.
New landlords often feel overwhelmed when they get into the rental property business. Buying your first property might seem like a challenge at the time but it’s a cake walk when you start to delve in to what it takes to manage that property. From preparing your property, getting your forms together, doing market comparables to set the rent, advertising, putting your filing system together, setting up your accounting and just generally reading up on all there is to know – it’s a lot of information! Ultimately though, the most important part of property management is finding the right tenants. If you are successful in this step, the rest of your journey will fall into place.
Tenants mean the difference between a positive, profitable experience and a negative, costly experience. Having a system in place to do proper tenant screening will help you find those gems that will pay their rent on time and take great care of your property. Here are some tips to help you become a better screener in order to attract a better grade of tenant:
Write a great, detailed ad. It all starts here as this is the first thing a prospective tenant will see when looking for a property. For example, if you don’t want pets or smokers, this is a great starting place to weed them out. You can also paint a good description of the type of tenants you are looking for by the types of amenities you describe. If you want a family you can talk about buses, schools and parks. If you want older tenants with no kids you can describe a more senior living area. The more descriptive you are, the easier it is to hone in on your ideal tenants.
Have a list of screening questions. After people have read your ad and decided they fit the bill and are interested, have a list of screening questions ready when they call. For example, how long have they been at their current place? Why do they want to move? Have they given notice? How many people will be living with them? These are just a start and there are plenty more you can ask but these questions will arm you with more information and make your decisions easier as you set up viewings to see your property.
Use customized forms. During the tenant screening process, the most important form in your repertoire is the Application Form. Don’t use generic forms that you find online, use a custom form that asks about employment history, rental history, and allows you to perform criminal and credit checks. If you have a prospective tenant that you want to consider renting to, get them to fill out this form in it’s entirety.
Do your checks! Sure they’ve filled out the Application form for you but the next step is the most important. Call their old landlords, verify that they have a job, do a credit check and do a criminal record check. Do these checks EVERY TIME on EVERY PERSON that you want to rent to. Looks and first impressions can be deceiving so stick to your system and you will greatly increase your chances of finding a good, honest tenant.
Thorough tenant screening isn’t always foolproof but it greatly increases your chances of finding stellar tenants. Experience helps this process as well and the more tenants you meet and interview, the easier it becomes and the stronger your radar is. Remember – stick to your system and don’t skip any steps. To your success!
So, you want to become a new landlord? Haven’t you heard the horror stories? 3:00 a.m. calls for a plugged toilet, tenants that don’t pay their rent, nasty evictions…it’s a minefield out there. But maybe you’ve heard the upside too. That owning a rental property substantially increases your wealth because you have a solid asset that someone else is paying off for you.
So how can you, a would-be new landlord, avoid the pitfalls and reap the rewards? How can you dodge the disasters and turn this into a profitable, hassle-free venture? The key is to start out on the right foot. Putting everything in place and being prepared will ensure that your experience as a new landlord is a positive one. Sure, there might be bumps along the way, but if you’re prepared, you’ll meet these challenges head on and overcome them.
The best way to prepare is to learn from experienced landlords that have come before you. Al Williamson and I met on the Bigger Pockets Real Estate blog and decided to share our own experiences by putting together an infographic called “The Top Ten Best Tips For New Landlords”. We think these tips will be very helpful to someone that is just starting out in the rental property business and I’ll break them down here for you in more detail.
Becoming a new landlord might seem like a huge learning curve and in the beginning it really is. Use our inforgraphic “The Top Ten Best Tips For New Landlords” to help you keep all of these points in mind as you start out. Al and I sincerely hope you find it helpful and we wish you all the best with your rental property empire!
When you finally have a little money saved and you’re thinking about investing it for your future, the road to prosperity can take you in many different directions. There are so many different ways to make money and so many ways to invest it for the future. Whether you’re just considering purchasing your first rental property, starting a business or looking at other types of investments to build your wealth, it’s a great idea to start with some personal finance building blocks. In this “Steps to Success” blog series I’ll offer you some of these different ideas to get you started. In each post I’ll give you two new ideas to try to help you enrich your life. Yes, most of it is about personal finance but you’ll soon see that many principles can apply to any part of your life. The REAL secret to success is balance after all.
In this first post, I want to focus on making a plan for what you want in life. Once you have a vision of what you’d like to accomplish and have, we can look more at the specifics of how to get there. Here are two ideas to get you started.
When you’re planning your financial future, you hear about setting goals all the time. The reason is, it’s hard to get there if you don’t know exactly where you’re going. I think one of the reasons that people don’t take this step is that there’s too much information about the best way to set goals. When I type “setting goals” into a Google search, there are 179,000,000 results and everyone has a different opinion. “Write them down, make them S.M.A.R.T., dream big, start small, be specific.” Suddenly just setting a goal seems like a big deal.
The truth is though, if you want to get ahead and be successful, you have to set goals. When you set a goal it gives you a vision and it also gives you the motivation to achieve it. There is also a great boost of self confidence when you accomplish your goal and that in turn keeps moving you in the right direction, towards the success and wealth that you desire.
The best tip that I ever learned was from Jeffrey Gitomer who is a leader in the Sales industry. He recommended using sticky notes, writing down a goal and posting it to your bathroom mirror. Small goals, big goals, short term or long term, any kind of goals. Personal goals, financial goals…they don’t have to be written a certain way or in a certain format. The point is you see them every day and they take root in your mind. As you accomplish your goal, you move it from your bathroom mirror to your bedroom mirror and take great pride as you watch that bedroom mirror fill up.
I have followed this advice for a couple of years now and it’s worked very well. I’ve accomplished many of my goals and it DOES feel great to see that bedroom mirror fill up. It also feels great on the inside to know that I am steadily moving forward in the direction of my dreams.
Give it a try! And by all means, tell me what you think.
I am a big believer in the dream board and I recommend it to everyone I know. Dream boards are a collection of images that help you visualize the life of your dreams. It might contain images like your lakeside mansion, your ideal fit body, your dream vacations and your perfect job. There’s no limit to what you can put on a dream board. They’re your dreams…go wild!
Dream boards are different than goals as you don’t really need to have any idea how you’re going to achieve it. Just looking at it every day and imagining yourself living that ideal life puts the universe in motion to bring it to you.
Dream boards are fun to put together. I use a plain cork board from Walmart and look through images on Google. When I find one I love, I cut it out and add it to the board. Once you start you’ll come up with all kinds of ideas and big dreams. I keep my board in my home office so I see it every day.
Once you have your board, all you have to do is put your imagination to use and imagine yourself living that life right now. Add a little unwavering faith that it’s all coming to you and feel happy about your present life every day.
It’s just that easy…try it!
I really hope you’ve enjoyed the first blog in this series. It’s a little different than just talking about rental properties but there’s a method to my madness. I think beginner investors and beginner landlords are often overwhelmed and become paralyzed by a lack of confidence in themselves and their abilities. Starting off with some ideas that help your mind, your attitude and your outlook will make those big challenges seem more achievable. I often think, “there’s more to investing than just money and know-how”. There are other things you can learn about yourself, how you think and how you handle what life throws at you that can really make a difference in your life. To your success!
Ashley Halligan, a rental property analyst, recently wrote an article outlining unique curb appeal strategies for rental property owners. She interviewed Jared Meadors, who owns Medusa Properties, a niche-rental company based in Houston, who provided his secrets to attracting quality renters and retaining them–even with slightly higher rents.
His strategies include adding era-specific architectural touches that are eye-catching and offer a sense of authentic age to a property. He also emphasizes fencing from a creative perspective–using reclaimed materials, incorporating private nooks and buffers between the tenant’s front door and the street. Lastly, Meadors chooses low-maintenance, unique foliage that’s often built from his unique fencing measures, offering extra color, little necessary oversight and a way to stand out amongst neighbors.
Though there is a slightly higher up front investment, Meadors (who’s strategies have proven successful), demonstrates that the return compensates for the investment in short time. His tenants are happier, remain longer and have a slightly higher than average rent.
Read the entire interview & story here.
Here is a before and after picture to see how small changes can make a big difference:
What’s in an ad? Everything. Where you should you advertise for tenants? Online.
When you advertise to find new tenants for your rental property, your ad accomplishes 2 things for you; first, it is a screening tool that let’s prospective tenants know what you’re looking for and second, it allows you to be very descriptive which brings more and better potential tenants to you.
When I advertise for new tenants, I use online sites exclusively. I have never advertised in the newspapers because it’s very costly for very few words. A typical newspaper ad might read “house for rent, 3 bdrm, $1000/mo + SD, avail Jan 1/14″. Depending where you live, this ad alone can cost a lot if you need to run it for a couple of weeks and it provides very little information to attract new tenants.
Online sites are cheaper (often free) and give you unlimited space to describe your property and provide multiple pictures. Prospective tenants are much more likely to look online for a property because it is more convenient and they also can find a better description before having to go and see a place. I’ve had people say, “well what if someone doesn’t have a computer?” and honestly, in this day and age, they would definitely be a very small minority.
Writing a great ad takes a bit of skill but if you’re successful, great tenants will always come in great numbers! Need some help? Just let me know.
In order to be successful in the rental property business, you really do need to be prepared. Putting good systems and processes in place will give you the confidence to get started and also keep things running smoothly as you acquire and manage more properties. This business like mindset is the key to success for a new landlord. On that note, here are a few things you should have in place before you start looking for tenants:
As I continued to manage my first property, I added a few more organizational items to keep things in order:
If you are just considering buying a rental property, I hope this list will help build your confidence to move forward. They’re fairly small steps to take, they’re easy to do and they set the stage for your future rental property empire.
If you live in a city with high real estate prices like I do, it can be very difficult to find and buy a good rental property. If you can’t charge enough rent to cover all of your expenses, the property soon becomes a drain on your bank account. One of the easiest ways I’ve found to acquire your first property is to move and rent out the house you’re in. Here are the benefits:
This plan worked well for us to get started in our rental property business but it might not appeal to everyone. Here are some disadvantages that might have come to mind (followed by my good reasons to just do it anyways):
We stayed in our next house for 2 years and then followed this plan again to get our second rental property. If you’re just starting out in the rental property business, I hope this plan will work well for you too.
Christmas is a great time to make your tenants feel appreciated. Little gifts go a long way towards a happy, long term relationship. In December, our city has the “Our Best to You” craft event and I always head there with my tenants in mind. Homemade fudge, amazing soaps, original prints, personalized ornaments – there is no end to the fun. I put a few items together in a gift basket with some homemade turtles and knitted dishcloths (thanks mom) and voila. Your tenants feel your appreciation for taking care of your property and in turn become greater tenants because they enjoy living there. Celebrate the season and share the love. And if you don’t love them – make that your New Year’s resolution!
Talk to any landlord and they’ll have a tenant horror story to tell – myself included! When you get into the rental property business as a new landlord, tenants are one of the most important factors to consider. Not only will they be looking after your property for you, they will also be paying it off and ultimately building your wealth in real estate. Your ability to attract and keep good tenants will determine whether your rental property business will be a success or a failure so it’s important to know the basics.
Writing a detailed advertisement has two purposes. It allows you to describe all of the benefits of your property and is also the first step in describing the type of tenant you are looking for. You can be clear about whether you allow smoking, whether you allow pets, the amount of rent and damage deposit expected and the length of lease term you are looking for. With all of this information available in the ad, you have already narrowed the field to prospective tenants that potentially fit your profile.
Screening is your second line of defense and the most important step in weeding out bad tenants. When a prospective tenant calls me, I have a list of questions that I ask immediately. If their answers to these questions are favorable, I set up a viewing time to see the property. If they are interested in renting from me, I take things to the second and most important step; filling out the Application Form. This signed form is invaluable as it covers their personal information, their employment history, their financial status and their rental history. The form also allows you to call previous landlords, call credit references, call personal references, conduct a credit check and a criminal record check. If a prospective tenant is not willing to sign the Application Form and provide me with access to this information, I do not rent to them.
Screening is an important first step for landlords and it also sets the tone for tenants as well. It portrays you as someone who is organized, diligent and someone who takes their business seriously.
When you have completed your initial screening and decided which tenants will be moving in to your property, the rest of the relationship is up to you. You may have found the best tenants in the world but they won’t stay with you if you don’t live up to being a good landlord. A good landlord/tenant relationship involves many aspects but here are the most important things to remember.
When tenants are moving in, have a landlord checklist ready so that you don’t miss anything. Some examples are signing the Lease, getting the locks changed, going through the Accommodation Inspection Report, getting post dated checks, preparing a Tenant Binder and putting together a Tenant Basket to welcome them to your property.
Throughout the tenancy it is important that you are always available when contacted. If a tenant calls with a request or repair that needs attention, always respond in a timely manner. Keeping your property in good repair let’s the tenant know that you expect the same from them and also gives them a sense of security about where they live. Stopping in at prearranged times gives you peace of mind that the property is being looked after. Giving small gifts at holiday times and lease renewals also goes a long way to making the tenant feel appreciated.
The law of attraction is always at work in every aspect of your life and the landlord/tenant relationship is no different. Be a great landlord and you will attract and keep good tenants!
In this day and age, there is a form to cover every possibility in the rental property business. From pet leases to utility sharing agreements, everyone will agree “it’s best to always get it in writing”. Making sure that all of the rules are clear before a tenant moves in leads to fewer disagreements and a cooperative landlord/tenant relationship. These signed documents can also protect the landlord if a substandard tenant should slip under their radar and take up residence.
If you are just starting out with one rental property, there are 5 essential rental property forms that you should have on hand before you start to look for a tenant.
RENTAL APPLICATION This is the first form that a prospective tenant will fill out for you during the first meeting if they are interested in renting from you. It covers the personal information of all the people that will be living there including their employment history, credit information and rental history. The best part of the application form is that it allows you to do a credit and criminal background check of a prospective tenant.
INSPECTION REPORT This is filled out before the tenant moves anything into your dwelling and again when they are ready to move out before you return their security deposit. There is a checklist for each room and describes the condition of each item on the list. I always back this form up with dated photos of the property and have the tenant sign both.
LEASE AGREEMENT This is the meat and potatoes of all rental property forms. It outlines the rent, security deposit, length of stay and also lays out all the rules and regulations of living in your property. You can start out with a generic form which can be changed and revised to suit your specific needs or you can use one from an experienced landlord. I like this option because it will already be much more specific based on the landlord’s previous experiences and you can still modify it as required.
DEPOSIT AGAINST RENT Once you have done all of your investigating and decided on a great tenant, it’s time to get a deposit to hold the place until move in day. This form is simply a receipt for that amount and also sets out what is still required as far as security deposit and rent before they take possession.
LANDLORD CHECKLIST Owning rental properties is a business and in order to run a successful business, you need to keep yourself organized. I created a landlord checklist that I use for each new tenant moving in to my properties. It reminds me of all the things I need to do including property fix ups, tenant checks and everything from moving in to moving out. I find this tool invaluable as I never miss a thing and it starts my relationship with my tenant out on the right foot.
These forms will get you started in your rental property business and should be considered your “core package” that you use for everyone. Depending on your needs or as your business continues to grow, you can introduce more forms to your repertoire. These might include utility agreements, garage leases, notices to enter the premises or eviction notices.
Evicting a tenant can be a stressful, tedious process if you aren’t sure of the proper steps to take. There are all kinds of situations that can lead to an eviction but the most common one is missed rent payments.
If a rent check is returned to you NSF, meaning that there are non-sufficient funds in the tenant’s bank account, things can go one of two ways. They can go well (the tenant pays you for the missed rent and NSF charge in a timely manner) or not so well (the tenant misses this payment entirely and possibly more rent payments). If things go in the latter direction it is very important to act. The first step is to send them a default notice. If they don’t respond to that by paying you the missed rent, the second step is to start the eviction process.
This is where some landlords make the mistake of using their heart and not their head. You hear all the time that “tenants have all the rights” and “it can take forever to evict a tenant”. More often than not though, a lengthy eviction is a direct result of a landlord not starting the process soon enough. They listen to excuses and promises to pay, all the while paying rental expenses out of their own pocket while these promises continue to be broken. Suddenly they find that weeks or months have passed and they still haven’t taken the steps to formally evict the problem tenant.
Starting the eviction process sooner rather than later is in your own best interest because owning a rental property is a business. If the tenant comes through and pays you and you feel positive about having them stay on, you can cancel the eviction. If they don’t come through, you haven’t spent so much time and out of pocket expense waiting for a resolution, the eviction process is already in motion.
A final note for the kind hearted, and I’ll be honest I am one, is that ultimately bad things can happen to good people. If your tenant has had a good payment history and has hit a bump in the road, hopefully he’ll be able to catch up and set things right. If not you can look at this as a positive learning experience for you to learn the eviction process. Hopefully it will be an experience that you won’t have to repeat again.