I am a representative of the Mental Health Association of San Francisco. I would love your site's help in publicizing our event: Hoarding and Cluttering Conference 2007 on October 18. The event pertains to those who are landlords as hoarding and cluttering is highly correlated with eviction rates.
THE MENTAL HEALTH ASSOCIATION OF SAN FRANCISCO PRESENTS:
Hoarding and Cluttering Conference 2007 - Progress Not Perfection: Improving Health, Safety and Comfort Through Harm Reduction
Date: Thursday, October 18, 2007
Time: 9:00 a.m. - 4:00 p.m.
(Registration begins at 8:15 a.m.)
Location: St. Mary's Cathedral, 1111 Gough Street, San Francisco, CA 94109
Keynote Speaker: Michael A. Tompkins, Ph.D.
This is MHA-SF's 10th annual Conference on Hoarding and Cluttering.
Compulsive hoarding and cluttering refers to the acquisition of and failure to discard a large number of possessions, which appear to be useless or of limited value, in an attempt to decrease stress and anxiety. This serious and prevalent problem can lead to eviction and homelessness. It is often a feature of several psychiatric disorders such as obsessive-compulsive disorder, attention deficit disorder and major depression, and can be caused or aggravated by problems associated with increasing age or physical disabilities.
Online registration is now available from our website! Click here to register now!
For more information about the conference click here.
(http://www.mha-sf.org/programs/hcconf.cfm)
If the above registration link does not work, paste this URL into your browser to register now!:
https://app.etapestry.com/hosted/MentalHealthAssociationofS/HCRegistration
Friday, September 28, 2007
Wednesday, September 19, 2007
Do Heating Bills Leave You Cold? Natural Gas Costs To Rise Sharply In 2008- Are You Prepared?
Do Heating Bills Leave You Cold?
Natural Gas Costs To Rise Sharply In 2008- Are You Prepared?
Utility costs are one of the largest operating expenses facing multifamily property owners. The demand for natural gas in the
Until today, there was not an effective and reliable way to bill residents for heat system expenses because of device tampering and undetected hardware malfunctions. The industry has forged ahead despite some early challenges because the benefits of heat cost allocation far outweigh the risks. Thankfully, those early hurdles have been overcome and heat cost recovery systems are better than ever. Benefits include:
- Recover gas costs, increasing the value of your property
- Receive consulting on gas conservation and heat ventilation and air conditioning systems
- Lower resident heat consumption
- Improve resident satisfaction through lower heating bills
- Manage costs through budgeting, analysis and cost recovery reporting tools
Heating Systems are Like Snowflakes
Every property has unique features to its heating system, and the heat cost recovery solution will need to be tailored to each location. When you select your service provider, make sure that they are staffed by certified technicians who are trained to perform a detailed, on-site survey to evaluate and recommend the most complete and efficient utility allocation system for your property.
Cool New Hardware Choices
There are many hardware solutions on the market that can measure time; there are also new solutions that measure both time and temperature for optimal accuracy. This technology allows property owners and managers to measure the individual use of forced hot air furnaces, hydronic baseboard and fan coil boiler/chiller systems, fireplaces and domestic hot water heaters.
These advanced devices detect and remotely communicate whether each monitoring device is working correctly and if it has been disabled, which ensures flawless and accurate heat cost monitoring to recover maximum gas costs and equitable billing of residents.
ista
Heat Cost Monitoring Systems Save Money
A heat cost monitoring system helps recover the rising costs of natural gas, and provides a rapid return on investment, thereby increasing property value. Once you start monitoring your heating costs, you will also need to have a system in place to bill your residents. Many companies offer both hardware installation and billing and support services. When selecting a company to provide your heat cost monitoring and billing services, you should consider the following:
- What hardware do they use?
- How much experience does the company have billing for heat?
- Are their technicians certified and prepared to conduct a thorough onsite survey?
- Do they have in-house regulatory expertise that is familiar with the billing regulations in your state and county?
- Are they prepared to customize a solution to meet your property’s unique circumstances?
- Do they offer a call center for resident billing questions and disputes?
- What kind of training will they provide to your on-property staff?
- What kind of maintenance plan do they offer?
- Do they offer financing options?
- Do they offer any additional services that can enhance your billing program?
Resources:
- www.ashrae.org - Ashrae Guideline 8p Energy Cost Allocation for Multiple-Occupancy Residential Buildings
- http://www.price-hvac.com/media/trainingModule.aspx#flash – Basics of HVAC Flash module
- www.ista-na.com
Thursday, August 2, 2007
ZERO TOLERANCE - Learn About What It Means to Enforce A Zero Tolerance System
So You're a Landlord? Or are you thinking about becoming one? Let me tell you it ain't easy!
You're probably sinking in your chair right about now thinking, "I'm not even two sentences into the article, and already I'm nervous." Don't be. We here at LandlordAssociation.Org believe in giving you the truth - nothing more, nothing less.
Let's talk about one of the fundamental aspects of our business that no one seems to talk enough about. This is the avenue of collections, i.e. you getting paid on time. We want you to develop what we call a "Zero Tolerance Policy." We're not advocating that you become a ruthless tyrant or an old man Potter from "It's a Wonderful Life", but we are saying that you ought to have a line that no one crosses. It's really up to you set that line, but you have to have one. It is an absolute must. This business that we are involved in is a very simple, yet very complicated business. Many times you are faced with decisions that, as a business owner, are easy, but as an individual, are difficult. In those times, you must remember why you are in this business . . .TO MAKE MONEY.
You may be asking yourself, "How do I create a Zero Tolerance Policy?" This is what we recommend.
1. BE THE BANK. - The bank doesn't care about your inability to pay. They are all business - so are you.
2. DRAW THE LINE. - You don't have to throw people out on the street on the 2nd of the month. You should have a system set up. For example: The rent is always due on the first, there is a grace period until the fifth. After the fifth, there is a $25.00 late fee. If the rent is not received by the 10th, then the eviction starts.
3. KEEP FLEXIBILITY IN CHECK. - We're not trying to contradict our previous statements or confuse you, but this is your opportunity to be a humanitarian - without getting burned. You may choose to grant a one time extension to an individual who really needs it. This extension should not be so long that it leaves you exposed. A respectable extension could be five days. You should only decide to grant this extension, if the tenant has contacted you. Never, never, grant an extension to an individual that you have to contact for the rent. You will most likely be out five more days of rent. Also, make absolutely certain to inform your tenant that this is a one time extension and that this cannot become a habit. If after the five days, the tenant balks when you ask for the money, YOU EVICT.
4. STICK TO YOUR GUNS. - When the time comes, you will do what you have to do. This is not something that is fun or comfortable it's business. You have to put food on the table and you also have to pay a bank that doesn't accept excuses as payment.
5. OPERATE FROM A POSITION OF STRENGTH. - Make certain that you pace your business growth. Just because you can buy a piece of property doesn't mean that you can afford it. Understanding this principal will help keep you out of financial trouble. If you are desperate for money because you're spread thin and have no cushion in the bank, you're going to start playing "Let's Make a Deal." This is not a game you want to play when you're collecting rent. It is better to take the loss and evict, than to hope that some late payer will get you out of hot water. Believe me, money in the bank takes a lot of stress out of this business.
Don't deviate from the system! Don't do it! I know that there will be times that you will want to, but it is in your financial best interest not to. Believe me, I know!
You're probably sinking in your chair right about now thinking, "I'm not even two sentences into the article, and already I'm nervous." Don't be. We here at LandlordAssociation.Org believe in giving you the truth - nothing more, nothing less.
Let's talk about one of the fundamental aspects of our business that no one seems to talk enough about. This is the avenue of collections, i.e. you getting paid on time. We want you to develop what we call a "Zero Tolerance Policy." We're not advocating that you become a ruthless tyrant or an old man Potter from "It's a Wonderful Life", but we are saying that you ought to have a line that no one crosses. It's really up to you set that line, but you have to have one. It is an absolute must. This business that we are involved in is a very simple, yet very complicated business. Many times you are faced with decisions that, as a business owner, are easy, but as an individual, are difficult. In those times, you must remember why you are in this business . . .TO MAKE MONEY.
You may be asking yourself, "How do I create a Zero Tolerance Policy?" This is what we recommend.
1. BE THE BANK. - The bank doesn't care about your inability to pay. They are all business - so are you.
2. DRAW THE LINE. - You don't have to throw people out on the street on the 2nd of the month. You should have a system set up. For example: The rent is always due on the first, there is a grace period until the fifth. After the fifth, there is a $25.00 late fee. If the rent is not received by the 10th, then the eviction starts.
3. KEEP FLEXIBILITY IN CHECK. - We're not trying to contradict our previous statements or confuse you, but this is your opportunity to be a humanitarian - without getting burned. You may choose to grant a one time extension to an individual who really needs it. This extension should not be so long that it leaves you exposed. A respectable extension could be five days. You should only decide to grant this extension, if the tenant has contacted you. Never, never, grant an extension to an individual that you have to contact for the rent. You will most likely be out five more days of rent. Also, make absolutely certain to inform your tenant that this is a one time extension and that this cannot become a habit. If after the five days, the tenant balks when you ask for the money, YOU EVICT.
4. STICK TO YOUR GUNS. - When the time comes, you will do what you have to do. This is not something that is fun or comfortable it's business. You have to put food on the table and you also have to pay a bank that doesn't accept excuses as payment.
5. OPERATE FROM A POSITION OF STRENGTH. - Make certain that you pace your business growth. Just because you can buy a piece of property doesn't mean that you can afford it. Understanding this principal will help keep you out of financial trouble. If you are desperate for money because you're spread thin and have no cushion in the bank, you're going to start playing "Let's Make a Deal." This is not a game you want to play when you're collecting rent. It is better to take the loss and evict, than to hope that some late payer will get you out of hot water. Believe me, money in the bank takes a lot of stress out of this business.
Don't deviate from the system! Don't do it! I know that there will be times that you will want to, but it is in your financial best interest not to. Believe me, I know!
Wednesday, July 18, 2007
Section 8 Voucher Reform
On July 12th the House passed the Section 8 Voucher Reform Act of 2007, H.R. 1851. The legislation will change Housing and Urban Development's (HUD) Section 8 public housing programs - expanding rental assistance opportunities, improving program efficiency, and encouraging family self-sufficiency. The bill expands the number of families receiving vouchers by 20,000 a year for each of the next five years and ensures the program works effectively for the nation’s low income working families with children, elderly and disabled.
Washington, DC - The House Financial Services Committee today passed H.R. 1851, the Section 8 Voucher Reform Act of 2007. The bill passed by a wide bipartisan margin of 52 to 9. The legislation would reform the Section 8 funding formula to make it more efficient, revise the rent calculation process for Section 8 and public housing to expand work incentives and reduce administrative costs, increase flexibility to use vouchers for homeownership, amend voucher targeting rules to increase voucher opportunities for lower income working families in rural areas, and authorize an expansion in the number of families receiving vouchers by 20,000 a year for each of the next five years.
“It is important that we move forward on Section 8 Voucher reform, if for no other reason than to restore our responsibility for the program. Many important aspects of the program like the funding formula have had to be addressed by the appropriators because we did not reauthorize the Section 8 Voucher program. Several weeks ago the funding formula was put in the Continuing Resolution without any vetting of the issue within our Committee,” said Rep. Waters.
“A program of this importance to American communities needs to be more efficient to be effective. H.R. 1851 represents consensus around a federal housing program that can work for the nation’s low-income working families with children, and the elderly and disabled, as well the Public Housing Authorities (PHAs).”
The Financial Services Subcommittee on Housing and Community Opportunity held a hearing to examine Section 8 voucher issues on March 9, 2007. Rep. Waters introduced H.R. 1851 on March 29, 2007, with Committee Chairman Frank, Ranking Housing Subcommittee Member Biggert, and Rep. Shays as original cosponsors.
The full committee also voted today to adopt Rep. Waters’ Manager’s Amendment that would provide for the following provisions:
This legislation will:
- Reform the voucher funding formula to increase eligibility and eliminate inefficiency. The bill reforms the formula used to allocate Section 8 voucher funds to housing agencies in order to increase the number of families receiving vouchers - through the elimination of inefficiencies that have resulted in $1.4 billion in unused funds and through incentives for agencies to use funds to assist more families.
- Authorize 20,000 incremental Section 8 vouchers in each of the next 5 years, for a total of 100,000 new vouchers.
- Encourage Economic Self-Sufficiency. The bill includes provisions to encourage economic self-sufficiency for low income voucher and public housing families, including:
- Reducing rent disincentives related to increases in earned income
- Making it easier for low income working families in rural areas to receive a voucher
- An improved funding mechanism to help families find employment
- Income exemptions for adult full time student dependents and for education savings accounts
- Helping low income families improve their credit score by allowing reporting of voucher and public housing rent payments
- Promote Homeownership. The bill permits housing agencies to let families use a housing voucher as a down payment on a first-time home purchase.
- Simplify the voucher, public housing, and Section 8 programs. The bill changes rent calculation, recertification, and inspection rules for the voucher, public housing, and project-based Section 8 programs, to reduce costs and compliance burdens for public housing agencies, landlords, and families. These changes are made while maintaining rules that target scarce resources to those families most in need and while maintaining rent calculation rules that ensure that rents are affordable.
- Increase tenant protections. The bill makes a number of changes for the benefit of federally assisted families, including provisions to preserve voucher families’ ability to move to other areas, to address excessive voucher rent burdens, to provide for more accurate fair market rent calculations, and to protect voucher holders in units that are in need of repair.
- Expand the Housing Innovation Program. The bill expands and renames the Moving to Work Program, which gives a limited number of housing agencies flexibility to experiment with development and rent policies, and strengthens the program’s evaluation process.
- Attach vouchers to housing units. The bill includes changes to make it easier for housing agencies to attach vouchers to housing units – an important option in tight rental markets and in developing supportive housing for seniors, disabled persons and homeless persons.
Washington, DC - The House Financial Services Committee today passed H.R. 1851, the Section 8 Voucher Reform Act of 2007. The bill passed by a wide bipartisan margin of 52 to 9. The legislation would reform the Section 8 funding formula to make it more efficient, revise the rent calculation process for Section 8 and public housing to expand work incentives and reduce administrative costs, increase flexibility to use vouchers for homeownership, amend voucher targeting rules to increase voucher opportunities for lower income working families in rural areas, and authorize an expansion in the number of families receiving vouchers by 20,000 a year for each of the next five years.
“It is important that we move forward on Section 8 Voucher reform, if for no other reason than to restore our responsibility for the program. Many important aspects of the program like the funding formula have had to be addressed by the appropriators because we did not reauthorize the Section 8 Voucher program. Several weeks ago the funding formula was put in the Continuing Resolution without any vetting of the issue within our Committee,” said Rep. Waters.
“A program of this importance to American communities needs to be more efficient to be effective. H.R. 1851 represents consensus around a federal housing program that can work for the nation’s low-income working families with children, and the elderly and disabled, as well the Public Housing Authorities (PHAs).”
The Financial Services Subcommittee on Housing and Community Opportunity held a hearing to examine Section 8 voucher issues on March 9, 2007. Rep. Waters introduced H.R. 1851 on March 29, 2007, with Committee Chairman Frank, Ranking Housing Subcommittee Member Biggert, and Rep. Shays as original cosponsors.
The full committee also voted today to adopt Rep. Waters’ Manager’s Amendment that would provide for the following provisions:
Using Vouchers for the Purchase of manufactured homes
Permits vouchers to be used for the full cost of purchasing manufactured homes on leased land.
Protecting Vouchers Reserved for Persons with Disabilities
Requires HUD to issue guidance to ensure that the 50,000+ vouchers created for persons with disabilities continue be reserved for such persons.
Breaking the Cap on the number of families a housing authority can serve
Permits housing agencies to exceed their limit on the number of voucher holders they can serve, thus encouraging more efficient use of voucher funds.
Voucher Reserves
Increases from 2% to 5% the percentage of reserves housing agencies can retain for the voucher program.
Portability
Provides for full funding for the cost of housing agencies accepting voucher holders from other communities, to strengthen the voucher program’s feature that lets families move from one community to another.
Family Self-Sufficiency Coordinators
Provides for a more reliable funding source for the cost of family self-sufficiency coordinators that assist public housing residents in finding employment.
More Accurate Market Rent and Funding Adjustments
Requires HUD to establish smaller areas for the purpose of calculating Fair Market Rent levels and providing annual voucher funding inflation adjustments, in order to improve the accuracy of such calculations.
Housing Innovation Program
Expands the number of public housing agencies that can participate in the Housing Innovation Program [renamed from “Moving to Work”], which lets agencies experiment with development, financing, and work incentive proposals, while also adding substantial tenant protections to the program.
Subsequently, the Committee passed a number of amendments, as follows:
- A Waters amendment to expand the permissible number of Housing Innovation Program agencies by 20, plus a second category of 20 additional agencies under expanded tenant protections, including expanded resident participation in any proposals to demolish public housing units.
- A Green amendment, modified by an amendment by Rep. Bachus, to authorize 20,000 new incremental vouchers in each of the next five years.
- A Waters amendment to strengthen protections for voucher families in units that fail to meet federal housing quality standards.
- A Lynch/Murphy amendment to strengthen voucher provisions to address areas when families face high rent burdens.
- A Watt amendment to ensure that families seeking public and assisted housing are only screened based on their ability to meet lease obligations.
- A Murphy amendment to exclude income from Coverdell and Section 529 educational accounts from rent calculations.
- A Moore [WI] amendment to increase voucher work incentives for severely disabled persons, in conjunction with State demonstration programs.
- A Capuano/Lynch amendment to protect families making less than 95% of median income from being evicted from “Demo Dispo” and Section 8 limited equity cooperative developments.
- A Green amendment to authorize 15 year contract terms for vouchers used in housing tax credit projects, to help facilitate financing for such projects.
- A Capuano amendment to protect “empty nesters” from eviction from certain buildings when their units are oversized.
Sunday, July 8, 2007
How to be an Effective Landlord - Rights and Responsibilities, by Bob Seigerim
Many investors are wary of the idea of renting property and the responsibilities that go with it. Unfortunately, this keeps them out of a profitable investing arena.
Following is a basic guideline for good rental management effectiveness and profitability.
Choosing Tenants
Your primary responsibility is to the maintenance and use of your property. Select your tenants carefully. It's unlawful to discriminate against an applicant because of race, national origin, religion, marital status, sex or physical disabilities. Beyond this however, it's still your property and you can pick and choose who you want living there. Never rent to the first person through the door. Prospective tenants will be shopping around, and you should too.
Make sure all applicants completely fill out an "Application for Rental" form. Forms like these are available at stationary and office supply stores.
Perform a thorough check of each applicant. Call the applicant's employer to verify employment, contact the landlord of the applicant's current or previous residence. This is the most important phone call of all. Check credit references if necessary.
"For Rent" signs and newspaper ads are not the best ways to attract trustworthy tenants. If this is how you advertise for tenants, make sure you screen them well. It's usually best to find a family or a person that can be recommended by a current tenant of yours. You may offer your current tenants an incentive for recommending strong prospects.
When writing a newspaper ad to rent your unit, make sure to give accurate descriptions. This includes the monthly rental amount, any deposits if required, description of the property or unit, and any restrictions that you maintain, such as children, pets, number of occupants, etc.
Don't be overly eager to get a tenant in. Indicate to all applicants that they will receive full consideration. Select a tenant that meets your requirements.
Collecting Deposits
Even though most tenants do not like paying deposits, it is in your best interest as a landlord to collect the last month's rent in advance. If the tenant fails to live up to the terms of the agreement, this deposit will help you to defray some of the costs of evicting the tenant. Defraying the legal costs is the only reason for this payment or deposit. You can also collect a cleaning deposit and a security deposit. These deposits are applied to any damages that occur while the tenant is occupying the unit.
Returning Deposits
If a tenant has in any way damaged your property beyond what would be considered normal wear and tear, you have the right to keep funds considered as security deposits and/or cleaning deposits. Try to use good judgment when determining what is and what is not normal. Normal use will age any property to some extent. Don't attempt to keep a tenant's money merely for this sort usage. You should, however, use the funds in these deposits to repair any damage caused by the tenant and/or to clean the property sufficiently so as to have it ready to show.
Inspection
A good rental agreement should have the tenant give a 30 or 60 day notice of vacating the property. Include a statement in your rental agreement that requires an immediate inspection at the time the tenant gives notice of his leaving. An immediate inspection helps you plan your strategy early if the property is not in good condition. It also lets you tell your tenant right up front what will be necessary in order for you to return his or her security/cleaning deposit. Include a final inspection the last day the tenant occupies your property.
Unannounced Entry
There has been an increasing number of restrictions put on unannounced entries in the past few years. Do not trespass unlawfully. Enter to make emergency repairs if you have to, otherwise wait until you get approval from the tenant for all other work. Don't abuse your privilege, you could end up with a legal battle.
Setting the Rental Amount
Your main consideration for determining the rental amount is based on rents of comparable rental units in the area. Common sense dictates that similar units rent for similar amounts.
Make sure your tenants know exactly when the rent is due. If you extend a grace period, make sure the tenants do not exceed that date for payment. Make it clear that you expect prompt payment.
Non-Payment
Even though you carefully selected your tenant from all the other applicants, things can go wrong. Job loss, illness, divorce, all kinds of things can hinder someone's ability to make timely rental payments. You may want to go easy on a tenant with a good payment record. A new tenant who can't pay, however, you should want to evict immediately.
Converse with your tenant. Try to determine when the rent will be paid. Tell your him that it's not personal, but a matter of operating your business. How long you wait to collect your rent is up to you. Clearly, the sooner the better.
Eviction
When all attempts to resolve your tenant problems fail, you must evict. Select your best course of action. Do you need an attorney, or can you start the process yourself for less money? If you choose not to use an attorney, you may want to use a "Notice to Pay Rent or Quit" form. This is used only to recover unpaid rent. The notice tells the tenant that he has only three days to pay the rent or leave the premises. If the tenant pays the rent within that three day period, things revert to business as usual. You collect the rent and the tenant doesn't have to leave.
A tenant with chronic offensive behavior may be served a "Notice to Quit" form. Use this form to begin eviction of a tenant who is disturbing and constantly breaking the rules. If the tenant is in violation, you have the right as the property owner to reclaim your property. The tenant must be "served" in person or by registered mail. Both of these notices are available in stationary and office supply stores. Consult an attorney to obtain knowledge of local, state or federal laws, alternatives and his professional advice.
Crowd Control
The more people who live in a unit, the more wear and tear, noise, damage, etc. One way to keep the crowds down is to limit the number of tenants per unit. Have this stipulated in your rental agreement. You can also stipulate an additional charge for each extra person occupying one of your units. If booze and drug parties, loud noise or music, or property destruction occurs, you may have grounds for eviction. Other than that, try to select the best tenants to avoid problems. Do not interfere in your tenants lives. Rent to them, reject them, evict them, or deal with them.
Maintenance
To determine how much maintenance will be required for your properties, just multiply the number of rental units you have, times the number of headaches associated with each unit. You must be proficient in repairing cracks in walls, painting, plumbing, yard work, electrical, etc. You will save a lot of time, money and stress from tenants if you can do this work quickly and efficiently.
If you can't do this work yourself, consider a good handyman. A really good handyman may be hard to find, but is well worth the search. Make sure the person you hire can be on call when you need him. Make certain the work is done well and is competitively priced. A good handyman can make you a better landlord.
Pest control is the landlord's responsibility. Shop around for the best combination of service and price. If there is a pest problem due to unsanitary conditions caused by a tenant, you have the right to demand that they clean up or otherwise correct the unsanitary condition.
Conclusion
Always start with good tenants. Use common sense and good judgment to avoid future, costly problems.
Following is a basic guideline for good rental management effectiveness and profitability.
Choosing Tenants
Your primary responsibility is to the maintenance and use of your property. Select your tenants carefully. It's unlawful to discriminate against an applicant because of race, national origin, religion, marital status, sex or physical disabilities. Beyond this however, it's still your property and you can pick and choose who you want living there. Never rent to the first person through the door. Prospective tenants will be shopping around, and you should too.
Make sure all applicants completely fill out an "Application for Rental" form. Forms like these are available at stationary and office supply stores.
Perform a thorough check of each applicant. Call the applicant's employer to verify employment, contact the landlord of the applicant's current or previous residence. This is the most important phone call of all. Check credit references if necessary.
"For Rent" signs and newspaper ads are not the best ways to attract trustworthy tenants. If this is how you advertise for tenants, make sure you screen them well. It's usually best to find a family or a person that can be recommended by a current tenant of yours. You may offer your current tenants an incentive for recommending strong prospects.
When writing a newspaper ad to rent your unit, make sure to give accurate descriptions. This includes the monthly rental amount, any deposits if required, description of the property or unit, and any restrictions that you maintain, such as children, pets, number of occupants, etc.
Don't be overly eager to get a tenant in. Indicate to all applicants that they will receive full consideration. Select a tenant that meets your requirements.
Collecting Deposits
Even though most tenants do not like paying deposits, it is in your best interest as a landlord to collect the last month's rent in advance. If the tenant fails to live up to the terms of the agreement, this deposit will help you to defray some of the costs of evicting the tenant. Defraying the legal costs is the only reason for this payment or deposit. You can also collect a cleaning deposit and a security deposit. These deposits are applied to any damages that occur while the tenant is occupying the unit.
Returning Deposits
If a tenant has in any way damaged your property beyond what would be considered normal wear and tear, you have the right to keep funds considered as security deposits and/or cleaning deposits. Try to use good judgment when determining what is and what is not normal. Normal use will age any property to some extent. Don't attempt to keep a tenant's money merely for this sort usage. You should, however, use the funds in these deposits to repair any damage caused by the tenant and/or to clean the property sufficiently so as to have it ready to show.
Inspection
A good rental agreement should have the tenant give a 30 or 60 day notice of vacating the property. Include a statement in your rental agreement that requires an immediate inspection at the time the tenant gives notice of his leaving. An immediate inspection helps you plan your strategy early if the property is not in good condition. It also lets you tell your tenant right up front what will be necessary in order for you to return his or her security/cleaning deposit. Include a final inspection the last day the tenant occupies your property.
Unannounced Entry
There has been an increasing number of restrictions put on unannounced entries in the past few years. Do not trespass unlawfully. Enter to make emergency repairs if you have to, otherwise wait until you get approval from the tenant for all other work. Don't abuse your privilege, you could end up with a legal battle.
Setting the Rental Amount
Your main consideration for determining the rental amount is based on rents of comparable rental units in the area. Common sense dictates that similar units rent for similar amounts.
Make sure your tenants know exactly when the rent is due. If you extend a grace period, make sure the tenants do not exceed that date for payment. Make it clear that you expect prompt payment.
Non-Payment
Even though you carefully selected your tenant from all the other applicants, things can go wrong. Job loss, illness, divorce, all kinds of things can hinder someone's ability to make timely rental payments. You may want to go easy on a tenant with a good payment record. A new tenant who can't pay, however, you should want to evict immediately.
Converse with your tenant. Try to determine when the rent will be paid. Tell your him that it's not personal, but a matter of operating your business. How long you wait to collect your rent is up to you. Clearly, the sooner the better.
Eviction
When all attempts to resolve your tenant problems fail, you must evict. Select your best course of action. Do you need an attorney, or can you start the process yourself for less money? If you choose not to use an attorney, you may want to use a "Notice to Pay Rent or Quit" form. This is used only to recover unpaid rent. The notice tells the tenant that he has only three days to pay the rent or leave the premises. If the tenant pays the rent within that three day period, things revert to business as usual. You collect the rent and the tenant doesn't have to leave.
A tenant with chronic offensive behavior may be served a "Notice to Quit" form. Use this form to begin eviction of a tenant who is disturbing and constantly breaking the rules. If the tenant is in violation, you have the right as the property owner to reclaim your property. The tenant must be "served" in person or by registered mail. Both of these notices are available in stationary and office supply stores. Consult an attorney to obtain knowledge of local, state or federal laws, alternatives and his professional advice.
Crowd Control
The more people who live in a unit, the more wear and tear, noise, damage, etc. One way to keep the crowds down is to limit the number of tenants per unit. Have this stipulated in your rental agreement. You can also stipulate an additional charge for each extra person occupying one of your units. If booze and drug parties, loud noise or music, or property destruction occurs, you may have grounds for eviction. Other than that, try to select the best tenants to avoid problems. Do not interfere in your tenants lives. Rent to them, reject them, evict them, or deal with them.
Maintenance
To determine how much maintenance will be required for your properties, just multiply the number of rental units you have, times the number of headaches associated with each unit. You must be proficient in repairing cracks in walls, painting, plumbing, yard work, electrical, etc. You will save a lot of time, money and stress from tenants if you can do this work quickly and efficiently.
If you can't do this work yourself, consider a good handyman. A really good handyman may be hard to find, but is well worth the search. Make sure the person you hire can be on call when you need him. Make certain the work is done well and is competitively priced. A good handyman can make you a better landlord.
Pest control is the landlord's responsibility. Shop around for the best combination of service and price. If there is a pest problem due to unsanitary conditions caused by a tenant, you have the right to demand that they clean up or otherwise correct the unsanitary condition.
Conclusion
Always start with good tenants. Use common sense and good judgment to avoid future, costly problems.
Friday, June 22, 2007
Mortgage Credit News, by Lou Barnes
As suspected here last week, long-term rates have stabilized: the all-powerful 10-year T-note in a broad range below 5.20%, mortgages 6.75-6.875%.
Everyone assumes the 10-year will make a run through 5.25%, and mortgages to 7.00%, but I don’t think we will stay that high unless there is worse news on inflation, or the global economy runs away from the central banks.
In the last week, the mortgage market has been glued to the demise of two Bear Stearns mortgage investment “hedge” funds. Their rise and demise tells the whole crazy-mortgage-credit story, abounds in black humor, and presages the untidy conclusion of an interval of excessive leverage in all markets.
The funds were created only 10 months ago, the larger fund named in ultimate hubris, High Grade Structured Credit Strategies Enhanced Leverage Fund. Bear raised $1.5 billion in capital, mostly from institutions, and then its geniuses borrowed to establish about $30 billion in mortgage derivative positions (short and long, some offsetting, about one-third of the position in tranches of CDOs made up of tranches of other CDOs, black boxes within black boxes.). The lenders were the usual suspects, clones of Bear: Merrill, Morgan-Chase, Barclays, Goldman, Deutschebank, Citi, and BofA, some with better security than others.
By May, Bear had lost the capital, and to meet margin calls sold the high-quality assets, then forbade investors to withdraw, and by last week faced a creditor mob threatening to seize the remaining derivatives and liquidate the two funds altogether.
Then it got worse. After much huffing, the creditors realized that a fire sale was not such a hot idea, because they all have clients invested in the same stuff that Bear has, and gazillions more in loans out to each other secured by that same stuff. If Bear’s trash sold for thirty cents on the buck, then that would be the value of their trash and the collateral securing their other loans. On Monday Bear’s lenders were talking about injecting their own money into the funds to prop them up, and all week long lurched back and forth between a collateral scramble and a negotiated workout.
In some ways, a routine end to a bad idea. But... look again.
In the 2000-2006 Wall-Street-pushed extension of mortgage credit on suicidal terms, I had assumed normal Wall Street operations: if you’ve got a client desperate for yield and self-deceptive about risk, sell ‘em what they want, and caveat emptor. The SEC protects widows and orphans; institutions are on their own. You may not cheat other institutions, but you have no duty whatever to save them from themselves.
The stunning thing in this Bear fiasco: these are the insiders in the suicidal mortgage credit game, Bear and all its lenders. These are the guys who offered to buy mortgage trash from Main Street in any quantity, designed bizarre structures to satisfy their co-dependent credit rating agencies, and sold them to feed the insatiable global demand for yield. Insiders entered the market for mortgage trash in the fall of 2006 when several million civilians knew that you might as well juggle nitroglycerine.
It never occurred to me that the insiders didn’t know what they were doing. So drunk on money and power that they didn’t know their incompetence.
As of this morning, rumor has Bear offering a self-rescue injection of $3.2 billion (double the initial capital), theoretically for pride. I believe that there is more going on. It is a serious accusation, but the Street has for months appeared to be in a conspiracy of silence, working to conceal the real value of $1.5 trillion in bad mortgage ideas created ’04-’06, abetted by the glacial pace at S&P and Moody’s to acknowledge their massive rating error. The Fed is just as silent, which may preserve calm for a time, but transparency is the only antidote to episodes like this one.
Consequences for “A” mortgage paper are likely to be beneficial, as frightened money moves to quality, but credit standards will be tight. The Bear adventure could catalyze a leverage meltdown in other markets, likewise beneficial to quality loans.
Everyone assumes the 10-year will make a run through 5.25%, and mortgages to 7.00%, but I don’t think we will stay that high unless there is worse news on inflation, or the global economy runs away from the central banks.
In the last week, the mortgage market has been glued to the demise of two Bear Stearns mortgage investment “hedge” funds. Their rise and demise tells the whole crazy-mortgage-credit story, abounds in black humor, and presages the untidy conclusion of an interval of excessive leverage in all markets.
The funds were created only 10 months ago, the larger fund named in ultimate hubris, High Grade Structured Credit Strategies Enhanced Leverage Fund. Bear raised $1.5 billion in capital, mostly from institutions, and then its geniuses borrowed to establish about $30 billion in mortgage derivative positions (short and long, some offsetting, about one-third of the position in tranches of CDOs made up of tranches of other CDOs, black boxes within black boxes.). The lenders were the usual suspects, clones of Bear: Merrill, Morgan-Chase, Barclays, Goldman, Deutschebank, Citi, and BofA, some with better security than others.
By May, Bear had lost the capital, and to meet margin calls sold the high-quality assets, then forbade investors to withdraw, and by last week faced a creditor mob threatening to seize the remaining derivatives and liquidate the two funds altogether.
Then it got worse. After much huffing, the creditors realized that a fire sale was not such a hot idea, because they all have clients invested in the same stuff that Bear has, and gazillions more in loans out to each other secured by that same stuff. If Bear’s trash sold for thirty cents on the buck, then that would be the value of their trash and the collateral securing their other loans. On Monday Bear’s lenders were talking about injecting their own money into the funds to prop them up, and all week long lurched back and forth between a collateral scramble and a negotiated workout.
In some ways, a routine end to a bad idea. But... look again.
In the 2000-2006 Wall-Street-pushed extension of mortgage credit on suicidal terms, I had assumed normal Wall Street operations: if you’ve got a client desperate for yield and self-deceptive about risk, sell ‘em what they want, and caveat emptor. The SEC protects widows and orphans; institutions are on their own. You may not cheat other institutions, but you have no duty whatever to save them from themselves.
The stunning thing in this Bear fiasco: these are the insiders in the suicidal mortgage credit game, Bear and all its lenders. These are the guys who offered to buy mortgage trash from Main Street in any quantity, designed bizarre structures to satisfy their co-dependent credit rating agencies, and sold them to feed the insatiable global demand for yield. Insiders entered the market for mortgage trash in the fall of 2006 when several million civilians knew that you might as well juggle nitroglycerine.
It never occurred to me that the insiders didn’t know what they were doing. So drunk on money and power that they didn’t know their incompetence.
As of this morning, rumor has Bear offering a self-rescue injection of $3.2 billion (double the initial capital), theoretically for pride. I believe that there is more going on. It is a serious accusation, but the Street has for months appeared to be in a conspiracy of silence, working to conceal the real value of $1.5 trillion in bad mortgage ideas created ’04-’06, abetted by the glacial pace at S&P and Moody’s to acknowledge their massive rating error. The Fed is just as silent, which may preserve calm for a time, but transparency is the only antidote to episodes like this one.
Consequences for “A” mortgage paper are likely to be beneficial, as frightened money moves to quality, but credit standards will be tight. The Bear adventure could catalyze a leverage meltdown in other markets, likewise beneficial to quality loans.
Thursday, June 21, 2007
Credentialing Required of Landlord Businesses Wanting Credit Reports
We are informing landlords and property managers about changes coming from all three of the major credit bureaus requiring the credentialing of businesses wanting credit reports. This process is quite lengthy, costly, and frequently denies small home-based businesses [such as “mom and pop” landlords] access to credit reports.
Because of increasing difficulties nationwide resulting from fraud, identity theft, risk of casual disclosure or access, and overall mishandling of credit reports, the credit bureaus are adding more rules and regulations for accessing credit files. The new regulations affect the entire tenant screening industry. All tenant screening companies will be requiring an on-site inspection prior to granting access to credit reports.
On-site inspections will be required annually for landlords conducting business from their residences. More stringent documentation may also be required of such landlords. The annual on-site inspection is conducted to verify separation of office space from living quarters; as well as separation of office equipment such as a fax machine, telephones, computers, locked filing cabinets, etc. This separation is required to ensure that landlords are NOT working from their kitchen tables where they may accidentally leave a credit report laying around where it can be casually viewed. The onsite inspection fee must be paid in full before the inspection can be ordered.
Landlords will be able to obtain credit reports only if they successfully pass an on-site inspection by an authorized representative of the credit bureau. The authorized representative of the credit bureau will take pictures of your home and/or office, your workspace, and will ask you several required questions, such as your Tax ID and/or business license, etc., at an average cost of $100 (the actual cost may be more or less depending on the credit bureau).
To assist landlords, especially those conducting business from their residences, many tenant credit reporting agencies are now providing landlords with recommendations for “approval”, “approval with conditions” or “denial” instead of providing a detailed credit report. This way, landlords can obtain recommendations over the Internet almost instantly without sacrificing the security of a prospective tenant’s credit report.
We want to inform you that there are other alternatives available which will provide adequate background and financial information upon which a landlord of any size can base his/her rental decisions. A credit report is no longer the primary document needed to make a wise rental decision. IntelliCorp can have everyone validated for their other products within a matter of 1 to 2 days with as little as a rental agreement as proof of a landlord’s business. And, they can do it for much lower costs.
Here’s what’s happening:
All three major credit bureaus are now requiring a thorough credentialing of businesses wanting to obtain credit reports. In this new credentialing process, small home-based businesses [such as “mom and pop” landlords] are often denied access to credit reports. Because a lot of our members and visitors fall into this category, IntelliCorp has been unable to provide this service to as many people as they would like.
Some relief has recently been granted by TransUnion, but they still require an on-site inspection of the landlord’s business.
Here are the newest requirements set forth by Trans Union:
An End User [the landlord] operating from a home office may be approved [for access to credit reports] only if each of the following conditions are met:
1. The on-site inspection must confirm physical separation of the business from the living quarters.
2. The End User [the landlord] is listed in either the appropriate category of a reputable public business telephone directory (e.g., Yellow Pages, yellowpages.com, 411.com) or a national or state trade association or a current copy of the End User’s telephone bill reflects the same company name and address as the End User’s application for membership and the bill reflects commercial rate charges.
3. The End User [the landlord] must still show proof of a business (e.g., business license, vendors license, IRS tax ID) in order to have access to credit reports.
The process to obtain a credit report can take up to 2 weeks. This is because of the added paperwork, calling of bank and trade references, and finally completion of the on-site inspection (which costs $60.00 or more). This in depth process is mandated by TransUnion and is something IntelliCorp had to implement to offer credit reports to any client.
Once a client/business [landlord] has jumped through all these hoops and passed successfully, the client [landlord] will be permitted to obtain credit reports and can run as many as needed without having to fill out any additional paperwork.
Remember, there are faster, far less expensive alternatives to this cumbersome credentialing process. IntelliCorp has the ability to provide a landlord of any size with sufficient background and financial data upon which s/he can base their rental decisions without the need for a credit report.
If you have any questions or want to purchase one of our discounted bundled packages, please contact Michael Moats at 1-800-539-3717 ext. 148. Please use promo code "LLA1" to receive the discounts shown below.
Bundled Package #1 - Comprehensive Package $21.95
(after passing the credentialing process)
(available to any landlord with a rental agreement as proof of their business)
Because of increasing difficulties nationwide resulting from fraud, identity theft, risk of casual disclosure or access, and overall mishandling of credit reports, the credit bureaus are adding more rules and regulations for accessing credit files. The new regulations affect the entire tenant screening industry. All tenant screening companies will be requiring an on-site inspection prior to granting access to credit reports.
On-site inspections will be required annually for landlords conducting business from their residences. More stringent documentation may also be required of such landlords. The annual on-site inspection is conducted to verify separation of office space from living quarters; as well as separation of office equipment such as a fax machine, telephones, computers, locked filing cabinets, etc. This separation is required to ensure that landlords are NOT working from their kitchen tables where they may accidentally leave a credit report laying around where it can be casually viewed. The onsite inspection fee must be paid in full before the inspection can be ordered.
Landlords will be able to obtain credit reports only if they successfully pass an on-site inspection by an authorized representative of the credit bureau. The authorized representative of the credit bureau will take pictures of your home and/or office, your workspace, and will ask you several required questions, such as your Tax ID and/or business license, etc., at an average cost of $100 (the actual cost may be more or less depending on the credit bureau).
To assist landlords, especially those conducting business from their residences, many tenant credit reporting agencies are now providing landlords with recommendations for “approval”, “approval with conditions” or “denial” instead of providing a detailed credit report. This way, landlords can obtain recommendations over the Internet almost instantly without sacrificing the security of a prospective tenant’s credit report.
We want to inform you that there are other alternatives available which will provide adequate background and financial information upon which a landlord of any size can base his/her rental decisions. A credit report is no longer the primary document needed to make a wise rental decision. IntelliCorp can have everyone validated for their other products within a matter of 1 to 2 days with as little as a rental agreement as proof of a landlord’s business. And, they can do it for much lower costs.
Here’s what’s happening:
All three major credit bureaus are now requiring a thorough credentialing of businesses wanting to obtain credit reports. In this new credentialing process, small home-based businesses [such as “mom and pop” landlords] are often denied access to credit reports. Because a lot of our members and visitors fall into this category, IntelliCorp has been unable to provide this service to as many people as they would like.
Some relief has recently been granted by TransUnion, but they still require an on-site inspection of the landlord’s business.
Here are the newest requirements set forth by Trans Union:
An End User [the landlord] operating from a home office may be approved [for access to credit reports] only if each of the following conditions are met:
1. The on-site inspection must confirm physical separation of the business from the living quarters.
2. The End User [the landlord] is listed in either the appropriate category of a reputable public business telephone directory (e.g., Yellow Pages, yellowpages.com, 411.com) or a national or state trade association or a current copy of the End User’s telephone bill reflects the same company name and address as the End User’s application for membership and the bill reflects commercial rate charges.
3. The End User [the landlord] must still show proof of a business (e.g., business license, vendors license, IRS tax ID) in order to have access to credit reports.
The process to obtain a credit report can take up to 2 weeks. This is because of the added paperwork, calling of bank and trade references, and finally completion of the on-site inspection (which costs $60.00 or more). This in depth process is mandated by TransUnion and is something IntelliCorp had to implement to offer credit reports to any client.
Once a client/business [landlord] has jumped through all these hoops and passed successfully, the client [landlord] will be permitted to obtain credit reports and can run as many as needed without having to fill out any additional paperwork.
Remember, there are faster, far less expensive alternatives to this cumbersome credentialing process. IntelliCorp has the ability to provide a landlord of any size with sufficient background and financial data upon which s/he can base their rental decisions without the need for a credit report.
If you have any questions or want to purchase one of our discounted bundled packages, please contact Michael Moats at 1-800-539-3717 ext. 148. Please use promo code "LLA1" to receive the discounts shown below.
Bundled Package #1 - Comprehensive Package $21.95
(after passing the credentialing process)
- Criminal SuperSearchOne (1) Single County Search
- Sex Offender Registry (all 50 states)
- Social Security Verification with Address History
- OFAC (Terrorist Database) Search
- One (1) state Eviction Search
- Credit Report from TransUnion
(available to any landlord with a rental agreement as proof of their business)
- Sex Offender Registry (All 50 States)
- Social Security Verification with Address History
- OFAC (Terrorist Database) Search
- One (1) State Eviction Search
- Bankruptcies, Liens and Judgments Search
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