Way to Increase Rental Cash Flow and Beef Up Your Bottom Line

Increase Cash Flow ASAP!

Make it easier to increase rent without an argument

Believe it or not, many landlords are afraid to increase the rent. The fear of confrontations or negative tenant contact is the leading cause for neglecting rent increases and other forms of lease enforcement.

The Rent Increase Letter is a form letter which tells the tenants the amount of their rent increase, when the increase takes effect, and the new payment amount. It is a polite notice that reaffirms that all the terms and notice periods agreed in their lease will remain in full force.

The Increase Letter comes in very handy on month to month rentalsor on annual leases.

People often ask us: "How much should we raise the rent?"

Well, that depends on a few things:

1. The market,
2. the quality of your tenant,
3. the availability of new tenants.

If a tenant is wonderful, we'll hold our increase down to an absolute minimum. If a tenant is lousy, he'll get a large increase. We don't want lousy tenants.

Related Forms that are proven to Increase Cash Flow:



• Rent Increase Letter is a simple form letter which tells the tenant of the amount of their rent increase, when the increase takes effect, and the new payment amount. It is a polite notice which reaffirms that all the terms and notice periods agreed on in their lease will remain in full force.
• Property Condition Report Checklist
  Protect yourself with a carefully documented Property Condition Inspection Checklist! I have found that when tenants sign the property condition report upon move-in, they take better care of the property leaving us with a noticeable savings in repairs and clean-up when they vacate.
• Notice of Renewal Option
  The renewal option is polite increase and renewal letter combined into one form. It assures the tenant that we value them and have kept any increases to an absolute minimum.
• Credit Reporting Disclosure to Tenant
  The Credit Reporting Disclosure Notice informs the tenants that you intend to report positive and negative payment history to the credit and tenant reporting bureaus. The form points out that the tenants' record will be affected by their rent payments, cleanliness and overall performance. This has made a tremendous difference with our tenants paying early, the last few years!
• Lease Obligations Reminder Letter
  The Lease Obligations Reminder Letter helps the landlord enforce the terms of the lease by politely bringing the tenant's attention to certain items and covenants in the lease agreement that may have been overlooked or forgotten about. It can be sent as a standard letter to all tenants or just make it look that way to a particular tenant, if you like.
• Security Settlement Statement
  This form alone has enabled us to make valid deductions (saving us tens of thousands of dollars in damages over the years) from security deposits without a hassle from the tenants.

My Pictures from the Oreia's National Real Estate Strategies Summit

Jeanne and I were at the Ohio OREIA National Real Estate Strategies Summit last week helping landlords and introducing them to The LPA! We've met a lot of great folks and were happy to see people taking control of their financial futures!
One of the questions I kept hearing was, "How did the Landlord Protection Agency get started?"

During an eviction in the early 1990's, a judge accusingly asked me "Where'd you get this lease?"
I was worried because he was yelling at everyone that day.
So, I meekly said, "I made that lease."
He said, "This is the best lease I've seen. You oughta market this thing to landlords."
I left the courtroom that day about 20 years ago, with a bounce in my step! Jeanne then bugged me for a few years to make a website to share our forms with other landlords, but I must confess, I didn't yet know what a website was!

We've grown a lot since then, now offering landlords a complete toolbox of awesome Landlord Forms, low priced instant online credit checks, Credit Bureau Reporting and much more.
I feel it's my revenge against all those bad tenants that helped educate me!

One of the most important things I learned over the years is: "95% of tenant problems can be eliminated in the screening process!" - John@theLPA

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My Pics from the Ohio Real Estate Investors Association (OREIA)Summit

This was the first time as a vendor at ORIEA. Jeanne and I met a lot of nice people, including some of our LPA members, along with some of the top Real Estate speakers in the country, including Real Estate Attorney Bill Bronchick, Jeffrey "Mr Landlord" Taylor, Vena Jones Cox !And, Shark Tank's Kevin Harrington gave an excellent presentation.

It was such a treat, we would definitely be happy to see everyone again!

With Real Estate Goddess, Vena Jones-Cox

I enjoyed the chance to meet Real Estate Attorney & speaker Bill Bronchick and enjoyed his fantastic presentation, "The Ultimate Guide to Seller Financing".

It was such a pleasure to finally meet and chat with Jeffrey Taylor, (Mr Landlord)!

With my lovely bride of 31 years. Besides being a great cook, Jeanne is an excellent and knowledgeable salesperson for the LPA!

Jeanne and Don Lieby, a former president of multiple real estate associations and investment groups. One of the sweetest and most interesting people we've met!

Me with Anthony Chara. Anthony presented "How to get Massive Passive Income in Apartments

I enjoyed spending time with Brad Grayson, an experienced landlord, property manager and seminar speaker (& great guy).

With Chris Knoppe, Director of Autumnwood Funding (Also a Shark Tank panelist)

OREIA's Shark Tank panel.

Free Webinar TONIGHT: Collect Back Rent

If you have tenants who owe you money, this is the free webinar you will want to see. Pass along the link if you know someone who can benefit from this. Thanks!

Free Webinar TONIGHT: Collect Back Rent

Join us for a webinar on TONIGHT - WEDNESDAY Oct 29, 2014
8:00 PM EST, 7:00 PM CDT, 5:00 PM PST

Register For FREE Webinar Now!

If you're like me, it really bothers you when people take advantage of you and leave your rental property owing you rent money and other damages.
I hope you'll join me in a powerful, educational webinar with Cynthia Schmidt "Mrs Landlady". Cynthia and her husband, Gary, authors and teachers of the Collect Back Rent program.

The webinar will discuss the Eviction Notices, Evictions, Small Claims to the Post-Judgment Proceedings to collect. The Schmidts have collected 90 satisfied judgments and are showing regular landlords like you and me just HOW to get our money - even from ex- tenants who we thought were uncollectible! If you are serious about collecting your rent/unpaid judgments and want to learn more - this webinar is a must!

After registering, you will receive a confirmation email containing information about joining the webinar.
See you later!

The 6 Biggest Landlord Traps - Landlord Trap #1 Improper Tenant Screening

Even landlords who have been around for a long time have fallen into these common landlord traps.
1. Improper Screening
"95% of tenant problems can be eliminated in the screening process."

Landlord Newsletter + Quick Landlord Tips

As someone who has experienced more than my share of tenant problems over the last 35 years, I've been helping other landlords achieve wealth and happiness through the use of The Landlord Protection Agency forms, various tools, such as tenant screening, tenant reporting annnd whenever there is a great service or opportunity or product available - that will benefit you greatly.... I want YOU to know about it!

I hope you'll join me in a Live Webinar for landlords on Collecting Rent owed to you by former tenants! If you have unpaid rent money out there being enjoyed by your ex-tenants, I think it would be worth your time! Webinar is free! Details below!

"Go for it, Rock!" - Tony the Loan Shark from "Rocky" http://myemail.constantcontact.com/Are-we-on-for-Tuesday----Quick-Landlord-Tips-.html?soid=1105372833860&aid=d8A98oUqbKk

How Much Should Your Late Charge Be?

Is My Late Fee Too High?

To be enforceable, Late fees must be considered reasonable in the eyes of the court and must not exceed the amount of the debt.

While many landlords don't charge enough in late fees, others go a bit overboard in collecting late charges. I know a few owners who spend a fair share of their daily time pursuing past due late fees. I recently had a student who had a tenant who owed accumulated late fees equivalent to approximately 3 times the total rent... and it was paid! He charged the tenant daily late fees each month continuously throughout the year with the months of daily charges overlapping. I'd hate to see him explain those calculations to a judge.

Most states have a statutory limitation on late fees, and when challenged, all state courts will limit them if the judge feels they are too high.

Some frequent questions are,

• "But what about if the tenant agrees to a higher late fee in the lease?"
  My answer would be to keep it reasonable and keep the state limitations in mind. These things rarely become an issue, since it is one of the terms of the lease in which the tenant has given his word of honor and signature of agreement and approval. It is usually when you are in court with your tenant for other reasons that everything unenforceable in your agreement is then challenged.

• "I charge a higher late charge than my state's limit. Will I have a problem collecting those fees?"
  Usually not in most tenancies, but it will become an issue if your late fees are challenged in court. In court I've seen late fees either reduced or completely eliminated by the judge.

Most landlords go to court with tenants for two reasons:
1. To kick the tenant out for non-payment or holdover in Eviction Court and
2. To settle disputes between the parties which may be for security deposits, damages, etc. in Small Claims Court.

One thing I learned is that a judge in eviction or small claims court is going to decide what he or she feels is reasonable according to the law. Keep in mind that there is a difference between "illegal" and "unenforceable".

The whole idea of the late fee is to encourage rent payments to be paid on time. A penalty fee should be enough to make paying late unpleasant and not so little that the tenant will be comfortable incurring late fees. Late fees should not be looked to as an additional stream of income, but as a deterrent to late payments!

Below are some links on limitations and the subject of Late Fees.

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Late Fee - Related Stories

State Limitations on Late Fees and Lease Inserts

The LPA Lease Clause # 3, Late Fees

How to Enforce Late Fees when the Tenant won't pay them willingly

LPA Essential Form: The Urgent Late Notice

LPA Essential Form: Rent Paid On Time Addendum

Landlord Tenant Law - State by State

Ask the Attorney John Reno

Landlord Screening Tip

Require Photo ID:
When screening an applicant, ask for a copy of a picture ID or drivers license. Make sure the person in front of you is the same person on the application and credit report. - The LPA

Preparing for Your Tenants to Move Out

What do I do when my tenant wants to leave?
(This article contains 3 FREE form downloads!)

When a tenant wants to terminate a tenancy, it is done in one of two ways. Either:

in accordance with the lease agreement, or

in violation of the lease agreement.

If your tenant wishes to vacate tenancy properly, it usually means giving you, the landlord written Notice to Vacate in a time-frame outlined by your lease agreement. Normally this allows the landlord enough time to prepare and find a new tenant for re-rental.

The usual steps a lease abiding tenant would take to terminate tenancy are: Click for the full article

Understanding a Credit Report Piece by Piece

How to Read and Understand a Credit Report

How good are you at reading credit reports? I've been reading credit reports for almost 3 decades on prospective tenants, so it never occurred to me that this would be a stumbling block for many of our new credit report customers. If it is new to you, it can be confusing, but don't worry.
It is very easy!

We dissected a TransUnion credit report to show you one section at a time the components and what they mean.

Section 1: The first section of a TransUnion Credit Report, is "Applicant Information".
This should be checked against the applicant information on your rental application.

Section 2: The "Credit Summary" is a brief breakdown of the credit report account (tradeline) statistics.

click here for the full article ...

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If you haven't already, please take the opportunity to quickly set up an account with The LPA's Quick Check Credit Reports! Quick Check is a simple, fast way to access online credit reports while saving you money!

NO sign-up or set-up fees,

NO membership fees,

NO compliance fees

Just instant reports at lower prices!

Special Tenant Screening Discounts for LPA members. See our price list!

How do You Prepare to Show Your Rental?

"Fail to prepare; prepare to fail."

Having Your Rental Property Show Ready is Only Part of Being Prepared

Have you ever found yourself at a rental showing appointment and realized that you forgot to bring the rental application(s)? How about meeting the prospect in the evening and realizing that you meant to replace some light bulbs to better see the unit?

Here are a few tips on having your rental "show ready":

• Make sure the unit is ready to be shown. Clean and empty, if unoccupied. Clean and neat if occupied.
  
• If showing an unoccupied rental, have all burned out light bulbs replaced, so evening appointments so prospects can see the property after work..
• Bring a can of air freshener. This helps, especially on units that are closed up or have odors.
• Have a container of disposable wipes and/or paper towels. Often while waiting for your appointment to show up, you may discover a need to wipe certain smudges or dirt.
• Make sure the front door is clean and if there is a screen or storm door, that the window is clean. It's always good to have a pack of Windex wipes with you too.

"You don't get a second chance to make a first impression!"

Here are a few tips on being prepared for your appointment:

• Remember the keys! In the excitement of having an appointment, it is amazing and how many people meet tenants at the rental only realize they forgot the keys! It can be an embarrassing waste of time.
• Have a supply of rental applications with instruction on how to submit the completed application unless it is submitted on the spot. You may also decide to have business cards, flyers or other handouts for the prospect.
• Remember to bring the prospects information and phone # with you in case you need to contact them in the event of delay or the prospect's lateness.
• It is a good idea to have a notepad for you to take notes and a supply of pens with you for applicants.
• Bring your cell phone. Not only for safety, but also in case of delays or other business reasons, such as checking with your office to reassure the applicant that the unit is still available.
• What other things can you use on an appointment?

5 Common Landlord Mistakes

Most landlords enter into a rental relationship with a tenant with good intentions and positive expectations. Like a chef who assembles and cooks a gourmet dish, a landlord also must consider the elements of a rental transaction with a tenant and the rental property.

In order to find a good tenant, we need to first understand the qualities or ingredients that a good tenant is made up from. Once we understand what ingredients we are looking for, we can carefully screen applicants with the right ingredients in mind. The LPA has a few tools that can help you determine if your applicant has the desired qualities you are looking for in your screening process.

So What Are the Trouble Causing Recipes for a Landlord?

1. Not Pre-Screening If you have lots of free time and enjoy spending countless hours talking with unqualified tenant prospects and then showing them your rental property, taking rental application after rental application, then don't pre-screen your applicants.

   If you value your time and prefer to focus only on qualified prospects, you need to have a pre-screening system in place that will allow you to easily weed out the unqualified, while still attracting the better possible tenants.

2. Incomplete Screening / Lack of Credit Report As a successful landlord, you want to make sure you have done a thorough screening every time you consider accepting a new tenant. If you're like me, your mission is to find something wrong with the applicant. I try my best to disqualify every applicant based on the information on the rental application, past landlord or employment references until I either find something or don't find anything that will eliminate the contestant.

   Failing to make a thorough screening check can make you kick yourself later and usually will.

3. Succumbing to pressure and Overlooking Red Flags Often newbie and experienced landlords are pressured to get a unit rented in order to make the payment. We find ourselves rationalizing red flags we recognize as danger signs, only to accept a sub-qualified tenant. You and I know that we may have bought ourselves a little time, but it almost always comes back to bite us... in spades.

4. Lack of a Solid Landlord Lease My real estate attorney told me long ago that in the absence of a good lease agreement the law is written to side with the tenant, so if you want to protect yourself against a particular tenant issue, you'd best address it in the lease. The LPA Lease was written to address a large variety of landlord tenant issues; many of which will never happen- unless you don't have the clause in your lease- then Murphy's Law may prevail.

5. Fear of or Refusal to Enforce Broken Lease Covenants Having a well screened tenant who signs a good landlord lease is great, but being protected by a good lease, and having a tenant honor that responsibility can be a whole different story.

   Often, when issues concerning tenant responsibility or expense arise, the tenant's first impulse is to call the landlord and ask that the landlord fix the problem. But it's covered in the lease, you say? Yes, but most tenants have convenient memory loss when it comes to their responsibilities according to the lease agreement. That is one of the reasons I created the LPA form, the Lease Obligation Reminder Notice which allows the landlord to enforce the terms of the lease by politely bringing the tenant's attention to certain items and covenants in the lease agreement that may have been overlooked or forgotten about. The notice is great as a preventative measure for many issues.

   It is also important to be able to nip an issue in the bud and tell the complaining tenant straight out that "That issue is your responsibility. You'll find it in your lease under paragraph # 8. Thanks for being on top of things. Please let me know when you have it taken care of."
   Good tenants are proud of being good tenants, and enjoy demonstrating it in their care for the property, so I very rarely have a problem with them.

Ingredients to Prepare and Maintain a Good Tenancy Tenant Finder ™ Pre-Screening Telephone Worksheet or The LPA Pre-screening Prospect Card (with html code for Internet ads) The LPA Rental Application The Landlord Reference Qualifier Credit Reporting Disclosure Notice Tenant Finder ™ Qualifier Chart Lease Obligation Reminder Notice

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.

More information on The Landlord Protection Agency is available at www.theLPA.com

Landlord Tip

Lease Renewal Clause

When giving tenant the right to renew the lease, please consider this: If the tenants are bad or you decide during the tenancy that you do not want to renew the lease, always include the words, "Subject to owner's written approval".

If you did not provide for a rate of rent increase in the lease, this enables you to send a renewal with proper notice with an increase offer the tenant may or may not elect to stay for.

Read more about The LPA Lease at The LPA's Essential Forms.

Funny Landlord Story: "It's Too HOT in here!"

What's a Thermostat?

On a very cold winter day a neighbor called me to tell me that one of my tenants had their windows wide open. I pay for the heat. I immediately went to see my tenant who complained that she had the windows open because her apartment was unbearably hot. I glance at the thermostat to see that it is set to - 80 degrees!!!! As I point to the thermostat in an accusatory way, while attempting to control my temper, she says "what is that?" God bless tenants.

This story was provided by Massachusetts Rental Housing Association (MRHA)

The Importance of a Property Condition Report

A carefully documented Property Condition Checklist makes more of a difference than you may think!

The Property Condition Report may be used with or without a Security Settlement Statement, but I have had better success using both.

The document not only is a complete condition checklist at Move-In signed by the tenant, it also puts the tenant on notice that the condition has been documented, dated and acknowledged. It is very important for the landlord to establish the condition of the premises before the lease begins and after the term ends.

It will be very difficult for the tenant to argue the facts noted on this form which is signed by them!

Video and Photo reminder: Tenants are reminded that the premises may have been photographed and video taped prior to occupancy and also upon vacancy.

Includes a Security Settlement section to calculate any deductions

Using The Condition Inspection Report along with the Security Settlement Statement will afford maximum landlord protection. As long as your charges are legitimate and conform to your lease agreement, it is very unlikely that any deductions will be challenged by the tenant.

Click to view ALL The LPA's Essential Forms!! (They are ALL FREE to LPA Members!)

Do's and Don'ts - Tenant Move-out

Landlord

What The LPA says you should do and what you should not do about:

Tenant Move-Out

DO

• Have a signed and fully documented Property Condition Report
  
• Have the tenants prepared with a Tenant Notice of Intention to Vacate Letter
  
• Use a Security Settlement Statement to itemize deductions and to accompany the return of the tenant's deposit.
  
• Use a Security Settlement Challenge Crusher letter to deal with any complaints about deductions from the deposit.
  
  

DON'T

• tell the tenants that they will not be getting their security deposit back. Let them see that on the Security Settlement Statement.
  
• return any security deposit until after tenant vacates and the rental has been inspected for damages
  

Want to Rent Quicker?

Why Some Homes Rent Fast and Others Don't

Real estate rentals have always been a fast paced business for me. A rental can be closed from beginning to end all in one day whereas a home sale an take months of hard work, bank approval, appraisals, inspections, and more to complete before the closing. A lease agreement signing can be very quick, but a landlord should take the time to make sure the tenant is carefully screened first.

As a landlord, one of the stressful aspects of renting is you need it rented FAST! Every day your rental property is vacant, it is losing money, so you must rent it as soon as possible at the best rental rate possible to the best qualified tenant possible.

Landlords with difficulty renting ask the usual questions, such as,

What's wrong with my property?

Am I asking too much money?

Is is me? Do I smell?

Is it the rental market?

The simple truth to all of those questions is... YES! (But I won't judge you on the smell. It may be a good smell) Take a look at this crude drawing I made of a triangle. The 3 sides are labeled with "Fast", "Qualified", and "Best Price".
It can be difficult to get all 3 sides of the triangle, but I'm telling you, you must!

First, understand the important factors needed to procure a fast rental and also the reasons a rental does not rent quickly.

It is usually a matter of how you look at things.
Many landlords look at tenants as sub-human trash who don't deserve to live in as nice a home as the landlord lives in or should be willing to take what they can get since they are not in a position to be choosy. Well, while that may be true for a small percentage of the tenant pool, these days, most tenants are more choosy than ever and believe it or not, there are more quality rentals out there than ever before. Landlords have become competitive in attracting the better tenants by offering better rental units.

Besides offering a quality rental you'd be happy to live in yourself, another thing to keep in mind ...

Click here for the full article

Anticipating Move-outs - Instructions in Advance Do Make a Difference

Minimize Move-out Damage with these
3 Free Forms

You will likely minimize damage and clean-up by using the Move-out Reminder Letter, Security Settlement Charges Guide and Move-out Cleanup & Debris Letter.

Move Out Instructions Reminder Letter
has become an important time and money saver. We send this form to the tenants about a week or two before they vacate. It reminds them specifically of certain tasks and cleaning they should perform in order to get a full security refund. This letter instructs the tenants how to lock up and secure the rental until it can be inspected by the landlord/ management, and also where and how the tenants should return all keys.
We have found this form to be very effective and it helps tenants to be more cooperative on the way out.

Move Out Clean Up & Debris Letter
Have you ever wondered if the tenants would have done a better job vacating if you gave them specific instructions? Much like the LPA Move Out Reminder Letter, this reminds the tenants to not wait until their last day of tenancy to put out garbage and debris. They are urged avoid clean up charges and deductions from their security deposit and to make arrangements as soon as possible to get rid of their unwanted items, rather than leave them behind in or around the property.

Settlement Charges Guide
Alerts the tenant before or after tenancy what kind of move-out charges he or she can expect for damages, cleaning or neglect caused as a result of tenant's occupancy. Some landlords send this form along with the Security Deposit Settlement to show how certain deductions from the security were calculated. What many tenants consider "normal wear & tear" are really damages and neglect that they should pay for.

click for MORE FREE FORMS

How do I Get FREE Credit Reports for Tenant Screening

LANDLORD SPECIAL REPORT: #15

How do I ...

Get FREE Credit Reports when screening tenants?

Credit reports have become one of the most essential elements in checking the background of a potential tenant. The days of the handshake rental lease are over. Today, renting to a person without checking his credit is like playing lotto. the odds of winning are against the landlord.

One of the reasons many landlords I have spoken with don't do credit reports is because of the cost of running a credit report. What?! The cost of the credit report?? Well, yes. Believe it or not many people would rather spend thousands of dollars in lost rent and legal fees, renovation and aggravation than the cost of a $15.00 credit report because they feel lucky.

Then again, there are those of us who know the risks are heavily slanted against us and will not rent without a full credit and background check on the potential tenant. We know that it is better to spend a small amount of money on the screening process rather than wanting to kick ourselves in the rear when the tenant burns us.

You may be thinking, "yeah, I know all that, but the title of this article has the words "FREE CREDIT REPORTS" in it and that's why I'm reading it." Well that's what I'll talk about.

There are 2 types of "Free Credit Reports" for tenant screening I'd like to tell you about.

1. The kind provided by the tenants
   
2. The kind you order and have the tenants pay for.

Some landlords will require the potential tenant to obtain a free credit report on themselves to submit along with their rental application. Experian and the other major credit bureaus offer anybody a copy of his or her own credit report for FREE.

Attention Tenants: As a tenant, being prepared and providing a recent credit report to a prospective landlord makes an excellent impression and greatly increases the the tenant's chance of being accepted over other applicants.

Many landlords ask me, "Do I need the tenant to sign something in order for me to get a credit report?" The answer is yes. In most cases, it is illegal to obtain a credit report on another individual without that person's written permission.
That is why The LPA Rental Application is what I always use. It provides the correct legal language that allows the landlord or his agent to obtain a credit report from any of the major credit bureaus.

Now, I'd like to tell you about the other kind of "Free Credit Report". This is the kind I always get. Years ago, I subscribed to a credit report reseller that provided credit reports by fax. Now I get instant online credit reports from Quick Check. That's the same credit bureau we now have on The LPA website. I feel the credit reports I buy from Quick Check Credit Reports are FREE because, my LPA Rental Application provides for a screening fee. I charge the applicant $25. per adult. Then, after verifying that the references and employment information on the rental application check out, I order the credit report which is instantly on my computer screen 2 seconds later. Did I pay for the credit report? Well, it's on my bill, but the tenant gave me the money to pay it! So I consider it a FREE CREDIT REPORT ! And that is what I recommend other landlords do too. Charge a screening fee. Use the LPA Rental Application if you don't already.

Short on rent by Bob G - Landlord Forum thread

I had a tenant who would make certain improvements to the rental and then expect to take the cost off the rent. I didn't mind that much at first because he did things that I would have done. But he did not tell me until I got the rent - only minus the amount of repairs. It got to be a habit. The last straw was when he recarpeted the house and put on a new screen door! I told him that I did not agree to this, but he said "I'M sorry, but the money is already invested in YOUR house." I then found a good eviction lawyer and learned about how to get rid of a real smooth operator. BUT that's a whole 'nother story.

See the whole Landlord Forum Thread here

Eviction Ramifications Notice

"The landlord will never evict me. They're bluffing."

This is a common belief among tenants in eviction status. Sometimes your delinquent tenant doesn't really grasp the consequences of a full blown eviction. This eviction letter explains the immediate and future drawbacks to the tenant caused by the process of eviction and it's aftermath. The

Eviction Ramifications Notice

is Free. You can print one at Free Landlord Forms

Rental Property in Foreclosure - Now What?

The Rental Property is in Foreclosure. The Tenants Know. What is a Landlord or Property Manager to Do?

By John Nuzzolese

In today's turbulent economy with record foreclosures nationwide, more landlords and property managers are sharing a once uncommon experience: Foreclosures. Today, foreclosures are everywhere you look. Many of the properties in trouble happen to be rentals, some under property management contracts. Let's take a look at the situations faced by private landlords and property managers hired as an agent of the owner.

Private Landlords

Picture this: The tenant is home thinking about making his next rent payment early. A knock on the door interrupts his thoughts only to be told by a bank representative that "the house in in foreclosure. Your landlord is not making his payments. You'd better start paying us directly or we will EVICT YOU!" Unfortunately many banks say even worse things to the tenants to scare them. This creates havoc for the landlord who is very likely trying desperately to find a way out of foreclosure.

How do you handle the tenant when he finds out the home he is renting is in foreclosure? If possible, nip the problem in the bud, before the tenant decides this is an opportunity to stop paying rent.

When you buy bread, do you ask the supermarket if they paid their bread bill?
Why then, does the tenant think he is entitled to FREE RENT when the landlord is behind with the bank?

Nipping the problem in the bud: If you know up to 3 months or more before the tenant that you can not make your mortgage payments, the best thing for you to do is prepare the tenant to be your ally. Get the tenant on your side. You can let him know you are "in the process of renegotiating the terms of your mortgage", (which you should be doing) and that there is a "slight possibility that the bank may try to "play hardball" and start foreclosure proceedings". Most banks will not negotiate terms with you UNLESS you are already in foreclosure! Imagine that! You try to talk to your bank and work things out BEFORE your account becomes delinquent - and they won't discuss it until you are in foreclosure! What's with these banks? Does it take a total collapse of the economy to make them start working with people???
Tell the tenant, "If you are visited by a bank representative, please let me know right away. Don't let them try to scare you with any of their unethical tactics. They should be talking to ME, NOT YOU." The cooperation of your tenant in this situation is golden!

They figure, "if the landlord's not paying the mortgage, why should I pay the rent?"

When it is too late to nip it in the bud: The tenant already found out you are in foreclosure! Many tenants see this as an opportunity to not pay rent. In this case, it is very important to take the bull by the horns and still try to "nip it in the bud." Explain that you are working with the bank and this is "standard bank procedure" for when mortgage payments are withheld. Let the tenant know you are trying to resolve the matter. You can be honest and tell them the worst case scenario actually could be foreclosure, but if that becomes the case, these proceedings take time and you will still be able to honor the term your lease agreement. If the tenant is difficult, warn him that it would be a shame if he stops paying the rent and has to be evicted.

Property Managers

I've been asked by property managers, what recourse there is against their client in the event an owner of a property falls into foreclosure. There's not a lot you can do besides sue the owner for breach of contract, if in fact they do lose the property, and your contract provides terms prohibiting the owner from losing the property. Most managers know it's probably a dead end and a waste of time to pursue, especially if the owner is also going bankrupt. Also, keep in mind that your management contract may not have been violated until the owner actually loses the property. You still get to collect your management fee as long as your client owns the property. Foreclosures can sometimes take a long time. It's very possible that your management contract could expire before the foreclosure comes to a conclusion.

"It's Not Over Till It's Over." - Owner's redemption rights
The management contract can forbid the owner from falling into foreclosure, but if he's going to fall behind on his payments, the manager may have to choose between two options:

keep doing his job until the last month the owner owns the house, collect rent and management fees and hope the owner will save the property, or

terminate the breached contract and involvement with the tenants and stop collecting rent and management fees.

Private Landlords and Property Managers

The tenants are contractually required to honor the lease and pay the rent for every month they are there. Even if the owner defaults on his mortgage with the bank,
a) he still retains the right to to redeem himself all the way up until after the foreclosure sale itself.
b) he still retains the right to evict the tenants if they fail to pay rent up until the property is transferred in the foreclosure.

As the LPA Lease says,

WITHHOLDING RENT Under no circumstances may any rent be withheld in full or in part, regardless of any expenses incurred by Tenant, regardless of the financial status of the premises, or the legality of the premises. Rent must be paid to Owner or Owner's agent only. Non-payment or payment to any other party is a violation of this Lease Agreement and cause for immediate eviction.

Existing tenants need to be aware of this fact and should not be allowed to see the owner's financial status as an opportunity for Free Rent. It is a good way for them to ruin their credit and be evicted. The banks also can take quite a while to evict an existing tenant after a foreclosure. In many cases they'd prefer the tenants to stay until the home is sold. During all or part of that time, the tenant has the opportunity to benefit from low or no rent, which will make up financially for the inconvenience of the foreclosure.

Copyright © 2009 - 2014 The Landlord Protection Agency, Inc. All Rights Reserved.

Would you like to re-print this article on your website or publication?
Permission is granted to use this Landlord Protection Agency article upon the following terms:

1. Full credit for the article is given to the author and The Landlord Protection Agency, www.theLPA.com
2. You display a link on your website to The Landlord Protection Agency. (www.theLPA.com).

The house we rent is in foreclosure - rent ? - Landlord Forum thread by Anne (Arkansas)

Hello - I'm a little confused as to what to do here. The owner of the home that we are renting had to file bankruptcy so our house was foreclosed on and sold at auction.

We knew this was going to happen because the owner was very upfront all along about his financial problems. When all of this started the property manager stopped coming by and collecting the rent check. When I called him about it he said that the trustee told the owner that "legally he could no longer collect rent". First the property manager just told us to hold onto the checks, then he told me (via text) that he wouldn't be collecting rent anymore and to just use it when we have to move. We finally received the paperwork from the law firm that is representing the owner of the home and they are requiring proof of tenancy by submitting "recent checks showing we are up to date on rent payment". We were in complete compliance up until we were told to stop paying so I'm not sure what to do? We could provide those checks but should I also print out the text messages between the property manager and myself as proof we were told to not pay? We plan on being out within 30 days but our deadline to turn in the proof is tomorrow. Will the fact that we were told to hold the rent mean that they can evict us sooner than 30 days? Thanks for your help!

See the full forum thread here

6 Ways to Turn Good Tenants into Better Tenants

Retaining Good Tenants Means Starting Off on the Right Foot!

By John Nuzzolese

We already know that the key to a successful tenancy is to first find a good tenant. Haven't we often secured good tenants only to find they drift to the wayside and gradually become bad tenants? Why is that? There are a combination of reasons that this happens. Those reasons are what I refer to in The LPA's article, "The 6 Biggest Landlord Traps". Let's explore how to make good tenants even better and how to keep them that way.

Now that you have a good tenant you have already screened, accepted and signed a lease with, you may be tempted to feel like your job is finished for now. The property is rented! Now you can take a vacation, right? Wrong. The job is never over unless you sell your rental property and retire somewhere nice, never to see or speak to another tenant again. Are you going to do that anytime soon? OK, so lets talk about making good tenants even better.

1. Emphasize the most important lease clauses. If you haven't already done so when you carefully went over the lease personally and emphasized the important items to your tenant, do it as soon as possible. (I hope you used my LPA Lease - I'm personally biased.) You can even do it with a follow up letter welcoming the tenants to their new home an reminding them of those key elements in your lease that are most important to you. Some landlords even send the tenant a spare copy of the lease with certain clauses highlighted.

2. Tell the tenants that you report to "National Tenant and Credit Reporting Bureaus". The reason I phrased it like that is because I don't want you to feel like you may be telling a lie. Reporting to a "National Tenant and and Credit Bureau" could mean the LPA's "National Tenant Rating Bureau or Deadbeat Database"". Or it could also mean that you are ready to use The LPA site to "prepare a delinquency report" to the major credit bureaus. I have achieved outstanding results by advising new tenants not to pay late because it can affect their credit rating. I inform them that they may not qualify for a car loan or mortgage in the future if they are not careful about their rent payment. I warn, "PLEASE DON'T RENT FROM ME if you think you will have trouble paying the rent on time. You seem like such a nice couple. I'd truly HATE to ruin your credit and damage your financial future". By the way, The LPA has a free members only tenant credit reporting feature that may help you collect delinquent rents.

3. Enforce your lease with "Essential Landlord Forms" that will support your lease. When a tenant gets out of line, correct the situation with a professional form. Nip the problem in the bud before a small problem becomes a disaster. If you do not send a late notice as soon as the rent is late, the tenant will continue to be late. If you are inconsistent with sending the late notice, the rent may consistently be late. Have you ever heard the old adage "Familiarity breeds contempt" ? Well, when a tenant becomes comfortable enough to think the landlord is a friend, he often loses the professional respect he may have once had. So, enforcing the lease with professional forms is the way to go.

4. Enforce penalties such as late fees. Using a professional form is great, but it has to pack a punch to get the results you want. Don't be afraid to hit a tenant with the late charge whenever the rent is late. I've had tenants tell me they were late just to see if the late fee would be enforced! Use a "Late Charge Due Notice" or an "Urgent Late Notice" to collect rent and late fees before too much time passes by.

5. Allowing an Early Payment Discount is another effective tactic to get the rent paid on time or early. Everyone wants to save money. And that money adds up over the year, so make sure the tenants know about it. If you didn't use the clause in your lease, you can always send them the "Early Payment Discount Voucher" found in Essential Forms.

6. Routine Inspections aren't always as important as the expectation of routine interior inspections. When the tenant is expecting an inspection of the premises by the landlord or manager, the property is usually kept ready to pass the inspection. Many landlords will inspect on regular intervals prearranged with the tenant. Others will do surprise inspections, and some just emphasize that they will be doing inspections, but just don't get around to it. Even if you can't get around to it, it may be a good idea to send the tenant a note from time to time to tell them of an upcoming inspection. The main thing is that your property is cared for properly.
   

   Keeping good tenants good or better is an ongoing process that we as landlords continue to improve with experience. It all starts with understanding and agreeing with each other. After that, it's just a matter of professional communication.

Picky Tenants with Allergies - Landlord Forum thread

by Anonymous on June 22, 2014

I apologize in advance for the length of my question/story! We have a 75 year old log cabin that we bought and completely renovated, (paint, new kitchen, log repair/replacement, new wood floor, tile in bath and kitchen, fixtures, doors, some new windows etc.) and turned into a rental 2.5 years ago. When we bought it there was new hvac and ductwork that had been installed within a year. We rented the house for 2 years and first tenants moved out in April. They were very happy, no issues other than squirrel in attic and needing a new thermostat for hvac. They did some pet damage to the house and left some stuff dirty but overall typical tenant damage. Rented to new tenants in May and complaints started immediately, said it wasn't properly cleaned (I cleaned it myself really well), then several days later they reported mice living in the stove, we immediately had an exterminator out and had a handyman block some holes the exterminator had found. We also replaced the stove, it was the only appliance not replaced in the renovation. Several days later our property manager sends us a 3 page email detailing all of their issues with the house. It was never mentioned before but apparently both tenants have severe allergies. Complaints include, dirty duct work with possible mold, oily dirty steam drips in the microwave, dog hair everywhere, slow draining sink in bathroom, mice feces oozing out of the tub enclosure, dirty ducts, meat cooking odor in the kitchen,just to name a few. According to them there allergies are unbearable and they can't run the hvac. I just want to point out, this is a really nice house, newly renovated, tons of curb appeal, the microwave was only 2 years old, hvac/ductwork less than 5, great location, great yard. My husband and I arranged for a trusted hvac person to come over and look at/perform maintenance on the system. We also took a look at all of their concerns. It was obvious that the previous tenants had run the hvac for quite some time with no filter, also they ruined the brand new 2 year old microwave, vent hood unit with something they cooked frequently,greasy steam did actually drip out. The tub was fine. We addressed each of their items and left telling them we would get back with them the next day with a plan.

The next day we bought a new microwave, and arranged for duct cleaning from a reputable company our hvac guy recommended. The woman flipped out and got really aggressive about wanting " a licensed mold abatement company." Anyway we have been going back and forth, we offer something, it's not good enough, or they say their too busy to be there. They keep escalating what they want.

We finally offered to let them out of their lease, I assumed that's what they were gunning for anyway. They came back and said they were insulted that we had suggested that. I'm at a loss, we've offered to spend $450 to get the ducts cleaned and if they want something beyond that they need to pay.

What should we do? I'm exhausted and frustrated and wish they would move out. I don't think they'll ever be happy but I just want to make sure we're doing what we need to do legally. Based on everything I've read we've gone above and beyond. We're kind of laying down the gauntlet because their demands are getting out of hand.

Regarding allergy complaints, previous tenants had a dog and it was no secret, we advertise that we will consider pets for all our rentals. Our property manager said the tenant had gone through this issue with allergies at a previous house so my feeling is that they should have done better due diligence. A 75 year old log cabin that has had pets in it for years is probably not an ideal choice for an allergy sufferer.

We have a property manager but she hasn't been a huge help, I think she's worried they're going to do something crazy, they have talked a lot about "documenting their medical bills for allergies" etc.

Anyone been through this situation before? We have a picky tenant at another of our rentals but when we offered to let them out of the lease "if they weren't happy" their complaints dried up pretty quickly. No such luck this time!

[ Reply ] [ Return to forum ]

The Secret Career Killer Facing Landlords

Are you a "Buy & Hold" real estate investor?

By John Nuzzolese

So, you want to be a real estate investor? You are probably thinking the way I did when I started as a real estate investor. I thought the most important objective was to buy as many properties as possible. Well, I was only half right.

As an investor in residential real estate, being able to purchase properties that will allow you to make money is paramount. While there are various methods you can use to make your real estate fortune, the two most common plans are quite simple.

Buy and flip. This is when you purchase a property and sell it for a higher price. Many investors will find "Handyman Specials" or "Fixer Uppers" at a low price to improve and sell at a higher price. Sometimes you are fortunate enough to find an excellent opportunity requiring little or no work, only to resell for a quick and easy profit. Although this is a common way to make money in real estate, many investors choose not to sell their investment property.

Buy and hold. This is when the real estate investor becomes a landlord in order to enable the investment property to generate income. Holding onto the property is also a way to allow the investment to appreciate in value over time. Why? The demand for residential real estate continues to grow and people are willing to pay top dollar for a place to live. What can be better than that? You have an asset appreciating in value plus you also have a tenant to pay your expenses on the property. You may even have a positive cash flow.

So what is "The Secret Career Killer Facing Real Estate Investors"? Before I answer that question, let me ask you,

• What happens when you put investment properties together with tenants?


• You get a landlord tenant relationship. I wish I realized the ramifications earlier.

Tenant problems are the one of the biggest reasons, if not, the biggest reason most landlords quit investing in real estate and sell their rental properties way before benefiting from one of the best features of owning real estate: appreciation.

It is just as important to learn the secrets of landlord protection and property management as it is to know how to accumulate rental property. Let me say it another way: Without knowledge of landlord protection, you as a landlord, are in big trouble!

Think about how much money people spend on books, seminars and trial and error learning about buying real estate. It’s incredible! I invested so much money learning creative ways to buy property. How about you? How much have you invested learning to be an efficient landlord? Most landlords learn their lessons the hard way like I did. Fortunately, now there are some books and websites on landlord topics that can shed some light on the subject and allow average landlords and “Newbies” to become educated and aware of their legal rights concerning landlord – tenant relationships.

What good is struggling and sacrificing to own a lot of properties only to bail out because of overwhelming tenant problems?

Get educated in the art of “landlord protection”. Learn how to avoid tenant problems so you can keep buying more investment property.

The three most important landlord issues to learn about for your own protection are:

1. Screening and Tenant Selection
   
   • I always say, "95% of tenant problems can be eliminated in the screening process!" It really is so true. A lot goes into screening a tenant properly, so try not to jump into any lease agreements without doing your homework first. The article, How to Screen Tenants in 5 Easy Steps will help you break down what to do when it comes to screening your potential tenants. The idea is to make the screening process as simple as possible for you while helping you to eliminate the unqualified prospects and focus on the more promising ones.
   
   
2. Using a solid landlord lease
   
   • One of the keys to a good landlord – tenant relationship is having both parties involved come to an understanding and agree with the terms in the rental contract. All too often we hear of and see tenant problems that could have been avoided if only the parties had used a better lease agreement. The problems usually stem from an issue that the lease should have covered, but did not. Most of the traditional leases are designed to make both parties happy, especially the tenants. Conventional leases are politically correct not to offend tenants and often leave the landlord wide open and prone to problems with the tenancy. Unless the landlord takes steps to protect himself in his lease agreement, the law will offer the tenants a strong bundle of rights giving them a legal advantage.
   
   
3. Lease Enforcement
   
   • Even with the greatest lease agreement in the world, a landlord faces a myriad of potential tenant problems. Enforcing the lease has to start the moment you sit down with the tenant at the lease signing. I know you may still be in the negotiating stage on certain items concerned in the lease, but enforcing the lease begins here. Reading the entire lease, clause by clause, emphasizing topics that are important to you reinforces your terms from that point on. Later on, when lease infractions occur, you must be prepared to jump on the issues professionally and immediately. Having the proper landlord forms to enforce your lease is essential. Using forms to correct tenant problems is both professional and efficient because you are creating an official record on paper of your legal communications concerning the events at hand. From an Urgent Late Notice to a more serious Eviction Notice served properly on a tenant, the landlord projects a far more professional image. The objective of the lease enforcement forms is to squash small tenant problems quickly and professionally before they develop into full blown disasters, while snapping the tenant back in compliance with your lease agreement.
   
   

If you have experienced the unpleasant part of being a landlord which includes loss of rent, possible foreclosure, loss of sleep, confrontations with unreasonable tenants, expensive repairs and restoration, vandalism, theft, squatters, evictions, legal fees, you may have had to consider if it's all worth it or not. Many new new investor / landlords decide quit the landlording business soon after a bad tenant experience.

As a real estate investor who intends to be a landlord and enjoy that excellent long term appreciation, it is absolutely imperative to have some landlording knowledge. I strongly recommend having more landlord tenant knowledge than your tenants do!

Happy investing and landlording!

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.

More information on The Landlord Protection Agency is available at www.theLPA.com

Copyright © 2000 - 2014 The Landlord Protection Agency, Inc. All Rights Reserved.

The Top 5 Ways to Ruin a Good Tenancy

5 common ways landlords ruin perfectly good tenancies

By John Nuzzolese

Imagine having the perfect tenants in your rental property. Maybe you already have them now. What we really hope is that these perfect tenants will remain perfect. To continue doing all the right things and not doing any of the wrong things. We want them to obey the lease agreement religiously, take care of the property and pay the rent on time or early. Imagine a tenant who leaves the rental better than it was found. Is this idea from the The Twilight Zone or something you can really have?

Most of the time, when we actually have a tenant that seems "too good to be true", something happens either suddenly or gradually to turn our tenant to the dark side.

Here are 5 common ways landlords ruin perfectly good tenancies:

1. Are They Friends or Tenants? Failure to maintain a professional distance from the tenants. Too often a landlord will fall victim to one of the oldest Landlord Traps by lowering his guard and allowing the tenants become personal friends. Rarely does this end well.
2. Broken Promises Failure to fulfill certain promises made to the tenants in the beginning of the relationship is a leading cause of the breakdown of the tenant's trust and respect in the landlord.
3. Greed In the real estate business for many years, I have found one thing to be universally common among sellers and novice (and many pro) landlords. It is the belief that their property is somehow better or worth more money than comparable listings that have sold or rented. It is this squeezing every dime out of a property that causes the tenant to resent the landlord. Even a good tenant can not help but dislike a greedy landlord who is overcharging the tenant. Overcharging? How can anyone say it's overcharging if the tenant agrees to the price?? There are many reasons a person will agree to pay a higher amount.
   • tight rental market
   • family crisis
   • tenant not qualified for another rental
   • many other reasons
   Having resentful tenants is not a recipe for a good long lasting tenancy.
4. Neglect Being a landlord is a business. For a business to do well, it must be maintained and run properly. That includes caring for rental property. As much as we try, we can't always make the tenants responsible for everything on a property. Some responsibilities belong to the landlord. It is important to nip small problems in the bud before they become major catastrophes. Besides, if you keep the tenant satisfied, your property will be more rent-able/sale-able.
5. Conduct Unprofessional conduct can range from rudeness to overly friendly. Try to refrain from arguing, using profanity or gossiping with tenants. It will come back and bite you. Let your attorney be the bad guy. He's the guy who tells you to "enforce your lease". Keep a professional, polite attitude to retain the respect of your tenants. Tenants respond better to a pro who knows what he or she is doing.

Early Occupancy - Allowing Tenants In Before the Lease Starts

"Can we have the keys a few days early?"

Early Occupancy Agreement Lease Addendum

How often do your new tenants ask if they can have the keys a few days before the lease begins?

Many landlords are only too happy to start off on a good note with their new tenants and gladly grant them early possession.
But wait! Are you getting paid for those days? Many landlords don't even think about what those free days are worth. (If you prorate the monthly rent by dividing the rent by 30 days, you'll get the daily amount per day) - On the other hand, the tenants may be doing you a favor by taking the property "a few days early" by getting the utilities into their name instead of yours.

More importantly, many landlords don't even realize the ramifications liability-wise when the they allow tenants to pre-occupy the rental before the lease begins.
Think about it.
What rights do tenants have when they occupy your rental, with the key you gave them, before the lease begins? They have all the legal tenant rights they can possibly have, without even being bound by the rules in the lease that hasn't even started yet. Do you think tenants might use this time to try to re-negotiate the lease or demand certain things be done before the lease term starts? You bet! They think they've got you over a barrel - and they may!

The Early Occupancy Addendum (EOA) protects the landlord when tenants move in early.

1. The EOA amends the lease start date to be when the tenants get the keys, obligating them to all the responsibilities and rules stated in the lease agreement.

2. The Early Occupancy Addendum breaks down the daily and total value of the extra days rent. If you decide to give the tenant those days for free, I recommend you still add it up for them to see and cross it out. When was the last time someone just gave you a hundred dollars?

3. It also requires that the tenants transfer the utilities they are responsible for into their own names before occupancy instead of using and/or abusing them while under the landlord's account.

Rent Payment: Cash, Check, Money Order, Pay Pal...

Collecting the Rent: What Form of Payment Should You Accept?

By John Nuzzolese

In today’s changing times, technology plays a larger role in the way we do business. More options are available to us in banking, communication and in collecting the rent from tenants.

Just as every property is unique, so is every landlord and his business. How landlords and property managers choose to collect rent varies greatly depending on experience and circumstances. There are a number of payment methods available for you to choose from when it comes to collecting rent from your tenants.

You can accept your rent:
In Cash

Accepting rent payments in cash normally means personal contact with the tenant, which can be quite involved at times. You may be thinking, “Cash is the simplest form of payment”, but in reality it can be a royal pain in the neck! Think about the pros and cons and you decide.

The Pros of collecting rent in cash

You don’t have to worry about checks clearing

You don’t have to wait for funds to clear

The Cons of collecting rent in cash

Going to the tenant to collect cash. You have to (or have someone else) meet personally with the tenant every month to collect your rent. This can sometimes turnout to be a time consuming session as it is an opportunity for the tenant to occupy your time with questions, complaints and/or demands concerning the rental property.

Travel time and expense. What if your rental property is more than a quick hop away?

Missed appointments. Have you ever heard of a tenant missing an appointment to pay the rent? How about just being late?

Having the tenant come to you. Some landlords have wised up and don’t allow the tenants the ability to waste their time on missed and late appointments and cost gasoline and time driving to rentals to get stuck talking to each tenant about their wish-lists, etc. Instead, the tenant comes to the landlord’s home or business with the cash. (They might just want to come in and chat sometimes.) For landlords who prefer their tenants to have 24 hour access to them at home 7 days a week, weekends and holidays, this is a great option!

Count the money. Remember you should count the cash and make sure it is all there! Don’t forget to give the tenant a receipt.

You can accept your rent:
By Check

Collecting rent by check is the method most landlords prefer. It also has its pros and cons, but so does every method.

The Pros of collecting rent by check

Checks can be mailed.
Tip: Professional landlords have tenant mail the rent to a PO box or a management office, not their home.

It is illegal to pass a bad check.

It is easier to prove rent was paid late. (By the post mark or even the date the check was written)

You know where the tenant banks. (This can be useful in the event you have to recover money from the tenant in the future.)

The Cons of collecting rent by check

Checks bounce when the tenant doesn’t have the money in the bank

Bounced checks incur bank fees that you must then collect from the tenant with a Dishonored Check Notice

Checks can be stopped by the tenant even after being deposited.

Accepting your rent by Money Order

The Pros of collecting rent by Money Order

Money orders are not likely to bounce

Money orders are difficult to cancel

They are easy to obtain at the Post office, 7/Eleven, Walmart, many drug stores, and any bank.

They can easily be mailed just like a check, so you do not have to see your tenants in person every month in order to get the rent.

The Cons of collecting rent by Money Order

I got nothing... Sorry. Oh yeah…

May be inconvenient for some tenants to go out and buy the money order.

Electronic Rent Collection: Direct Deposit

More and more landlords are making the arrangements with their banks (with their tenants’ cooperation) to automatically withdraw a monthly sum from the tenant’s bank account to be transferred into the landlord’s bank account on a set day every month. This can be an effortless method of rent collection as long as the tenant has the required money in the bank at the time of the transfer. It is an even better situation for the landlord when the tenant is qualified for sufficient overdraft protection.

The Pros of collecting rent by Automatic Withdrawal

No effort to collect when all is going well.

Easy to monitor online.

Not that difficult to set up with most banks

The Cons of collecting by Automatic Withdrawal

Monthly bank fees to maintain the account

You have to monitor the account to make sure the rent was transferred

Electronic Rent Collection: Credit and Debit Cards

Many property management companies and even private landlords are accepting the payment of rent by credit and debit cards. Access to this is normally restricted to businesses with merchant accounts to be allowed to accept the major credit cards, but now in today’s high-tech environment, just about anyone can have a PayPal account to enable them to accept credit card payment.

The Pros of collecting rent by Credit and Debit Cards

Even if it isn’t your primary method of collecting the rent, PayPal could enable the tenant to use his credit card(s) to pay you when he otherwise couldn’t pay the rent.

Many management companies have websites that make it easy for tenants to pay their rent online. This is a super convenience for people who are used to paying their bills online.

Online payments save the time of mailing and can be instantly verified.

You can use PayPal for billing and Send invoices online, even if you don’t have a website. You can also include a payment button in any email you send using Outlook.

The Cons of collecting by Credit and Debit Cards

By making it easy for the tenant to pay rent by credit card, you could unknowingly have tenants who are headed towards eviction while depending on limited credit to stay afloat.

Transaction fees. You would be required to pay a transaction fee each time you accept this method of payment. PayPal's transaction fees range from 1.9% to 2.9% + $0.30 USD. This is not a bad deal considering you do not have to pay any other bank fees or other fees associated with having a merchant account.

Copyright © 2009 - 2014 The Landlord Protection Agency, Inc. All Rights Reserved.

Would you like to re-print this article on your website or publication?
Permission is granted to use this Landlord Protection Agency article upon the following terms:

1. Full credit for the article is given to the author and The Landlord Protection Agency, www.theLPA.com
2. You display a link on your website to The Landlord Protection Agency. (www.theLPA.com).

Another Way of Helping Tenants Pay Rent on Schedule

The Rent Statement Mailer Delivers

Fact:
Rent is Paid More Timely When the Tenant Receives a Monthly Rent Statement

Whether you mail your tenant a monthly statement the same way your bank mails you your credit card statement, or supply your tenants with a Payment Book with pre-printed payments slips, the results are the same. The tenants are reminded of what they owe, when it is due, and what the penalties are for not paying on time.

Most landlords have positive results and more timely payments when using a Rent Statement mailer. It helps tenants Want to pay their rent on time and preserve their credit record with their landlord.

The Rent Statement displays the key monetary terms agreed in their lease. That's important because the tenant is reminded of these key items every month when they fill in the amount of their payment before sending it.

Tenants find it a little intimidating and a little more official when their Social Security # is on a document. This part is optional and need only be included at your discretion.

On the top right below the rental address is a payment breakdown area which includes:

• the rent due date
• the rent amount
• the late date and late fee
• the daily late date and daily late fee
• early payment discount date and amount of early payment discount (optional)
• Added rent incurred (any current or past due charges in addition to the rent)

The top tear off slip also includes the landlord's mailing address and instructs the tenant to whom to make the rent payable. Since it is editable in MS Word, it is also easily fitted for window envelopes with the tenant's address showing through.
The bottom portion has a place to record paid amounts and a check # and can be kept for the tenant's records.

When sending the Rent Statement Mailer, it is a good idea to enclose a pre-self-addressed envelope for the tenant to simply drop the top portion of the statement in along with the rent payment. Some landlords even prefer to stamp the envelope in an effort to remove every possible obstacle in the way of getting the rent paid. Personally, I say let the tenants buy their own stamps. If they are that helpless, we shouldn't have them as tenants!
(Sorry to sound so hardend, but after dealing with thousands of tenants over the years, you get this way! ;) )

Click to Read about more Lease Enforcement and Rent Collection Forms