10 Not-So-Obvious Tips For Real Estate Investing Success
Articles,  Blog

10 Not-So-Obvious Tips For Real Estate Investing Success

My name is Mindy Jensen, and I’m the Community
Manager for BiggerPockets.com, the real estate investing social network. I spend a LOT of time in the forums, and while
I have a lot of tips and tricks based on my own experiences, I’ve picked up some pretty
amazing tips from my fellow investors on the site. Here are 10 of my favorite not-so-obvious
tips for real estate investing success. Tip #1. Inherited tenant refused to provide a key
to the property. This situation should not even be given an
opportunity to happen. Always get a copy of the key to the property
– and verify that it works – before you close. If the selling landlord doesn’t have a copy,
they can get one from the tenant – it’s a sure bet the tenant has one! However, if this situation has already passed,
and the tenant refuses to give you a copy of the key, make your own. First, give your tenant proper notice in compliance
with your state’s landlord tenant laws, then have the property rekeyed by a locksmith. Leave one copy of the key in a real estate
agent-style lockbox with code access. Inform your tenant of the code, then retrieve
the lockbox at a later date. If you’ve got a combative tenant like this,
you may want to consider not renewing his lease. Tip #2. Your tenant wants to install cable/dish/satellite
Have a move-in checklist that the tenant signs, stating the condition of the property at the
time they take possession. Make a separate checklist that goes over every
single important part of the lease, and includes a space for tenant initials so, if necessary,
you can prove at a later date they were informed. Do not allow any installation of any service
without your permission and make sure to specify in the lease that it must be professional
installation. It is also good practice to give you a deposit
to return the property back to its original condition once they move out. Tip #3. If your Tenant Threatens a Lawsuit
The very moment a tenant utters the word “attorney” or “lawsuit”, cease verbal communication
immediately. Then notify them in writing that you will
only communicate with their attorney. Many times, this is the last you will hear
from them. And remember, text is currently NOT a legal
method of notification in all 50 states. But the US Postal Service is. Tip #4. Handling Late Rent
Have a clause in your lease for Late Fees and charge them as soon as your state laws
allow. Consider adding a phrase in your late fees
clause that says something to the effect of, “Regardless of tenant directives, any money
collected will first be applied toward any outstanding bills or late fees, then applied
to rent. Partial rent payments will NOT be accepted.” Many states accepting partial rent payments
stops or forces a restart in the eviction process. Tip #5. Moving out or returning the security deposit. In order to avoid confusion, spell out exactly
what you expect the property to look like when your tenant returns it to you. Consider creating a checklist that dictates
clean carpets, clean walls, clean appliances, clean drawers, ceilings and corners free from
cobwebs, toilets free from stains, window/sliding door tracks free from debris/dirt. You want to make sure that there are no surprises
at the end of your relationship with your tenant and you want to make sure you get a
clean property back. Tip #6. How to return the security deposit. Always get a forwarding address. When the tenant returns the keys, ask for
their new address so that you can return any portion of the security deposit. Now you don’t want to tell them that they
are getting their deposit back, word it in such a way that they won’t know for sure until
you go through the unit, but you need to return it within (insert state security law timeline
here) and therefore you need their new address. Tip #7. Multiple Roommates. In a multiple tenant situation, you want to
make sure each tenant qualifies individually for the entire rent, and that they know they
are individually responsible for the rent should all other roommates not pay or some
roommates leave the property. You’ll save yourself an enormous amount of
hassle by only accepting one check per unit which forces the tenant to come up with the
entire amount before they give it to you. Remember, partial rent will never be accepted. Tip #8. Get multiple emergency contacts for prospective
tenants on their initial application. If your application has only one space for
an emergency contact, consider an additional sheet with a few more. This will give you more numbers to call to
track down that tenant who skipped out on you. It’s a good practice at lease renewal to ask
the resident to update some of their contact information as most property management companies
and owners don’t do this. If the resident leaves you with damages or
unpaid rent, it gives you more numbers to call to try to get 100% of your money versus
sharing it with a collection agency….but if you do use an outside agency, it gives
them more numbers to call as well. Tip #9. Eviction Notice
Once residency has been established – whether you know about it or not – you must evict
each person by name (or use the all encompassing et al) in order to get the property back. Tip #10. Tenant Notification
Carry a briefcase in your car that has all your forms in it, so you can be ready at the
drop of a hat to give notice, instead of having to drive back to your office to get the forms. Oh! Bonus tip #11. Lease Renewal Inspection
Do a walk thru of apartments 2 weeks before you offer a lease renewal, call it a lease
renewal inspection. This way if the tenant was not taking care
of the unit you have the option of not offering a renewal. I want to give a HUGE thank you to everyone
who provided those awesome tips from the forums. For even more priceless information, visit
www.biggerpockets.com/forums. This is Mindy Jensen for BiggerPockets. I’ll see you around the site.


Leave a Reply

Your email address will not be published. Required fields are marked *