What Every Landlord Should Know About Discrimination
The Fair Housing Act of 1968, as amended, prohibits discrimination on the basis of race, color, religion, nationality, familial status, age, and gender. Many state and local laws also forbid discrimination on the basis of sexuality or source of income, and the Americans with Disabilities Act makes it illegal to discriminate against the disabled. If you harbor any such prejudices and would allow them to come into play when renting a housing unit, then you’re probably not cut out to be a landlord. However, many sincere real estate investors make honest mistakes that result in discrimination lawsuits. The best way to avoid them is to be informed.
Watch the Wording of Your Ads
The Fair Housing Act (FHA) may appear to be common sense, and most people would never think of discriminating against people of different races or religions, or on the basis of gender. However, it is important to note that the FHA extends beyond the screening process, and into advertising as well. This is where many landlords and property managers make fatal mistakes. After all, there are people who scour the classifieds looking for inappropriately worded ads so that they can pounce on them and threaten a lawsuit. While someone must have standing to bring suit, these scoundrels often work in coalitions to ensure that all of their bases are covered.
For example, if you own a rental property in a predominantly Jewish community, its proximity to the local synagogue could be a major feature. But if your ad says “within walking distance from the synagogue,” you could be sending the message “gentiles need not apply” – even though this wasn’t your intent. And keep in mind that you may not discriminate on the basis of whether a couple is married, whether or not children are to live in the unit, or on the basis of age. Novice landlords may not be aware of these areas of concern, and while it’s a good thing that citizens are more aware of their rights today, it can be a very bad thing for well-meaning landlords who are out of step with the times. Read more
Once I File An Eviction – Shouldn’t I Just Dismiss It If The Tenant Moves Out Or Offers To Pay?
This is a common question … most landlords are intimidated by the thought of going to court, and often look for ways to avoid it. Many landlords considering hiring me to assist them with a non-paying tenant want to know if we can save time and money by cancelling the whole eviction when the tenant either 1) voluntarily moves, or 2) voluntarily pays the past due rent. My advice? NO!
THE TENANT MOVES OUT
When filing an eviction because the tenant has failed to pay rent you’re seeking a number of things, first you’re asking the court to terminate the lease and return possession of the property back to you. Second, you ask the court to grant a judgment for all of the past due rent, as well as any rent accruing during the time the court case is pending. If you dismiss the case after the tenant voluntarily moves you take away the court’s ability to grant you a judgment for the past due rent! While a judgment is not a guarantee that you will ever receive the money, not receiving a judgment virtually guarantees that you will never receive the money! The courts in metro-Atlanta, in my experience, will generally grant you all of the past due rent, late fees up to 10% of the monthly rent, and court costs without hesitation. While no one can guarantee you’ll ever receive any or all of that money, getting the judgment is a necessary first step.
Another problem is claims of unlawful, or illegal eviction. Should the tenant move out, taking most (but not all) of his belongings you might be tempted to assume he is gone for good. You’re likely to enter the property, remove the few things left behind, change the locks and put up a for rent sign. Unfortunately, should the tenant later return, you would be guilty of an unlawful eviction, liable for the cost of any items you discarded, and potentially liable to the tenant for punitive damages. Unless the tenant has removed ALL of his personal property and returned the keys, you CANNOT assume he doesn’t intend to return!
THE TENANT OFFERS TO PAY
The second issue is what to do if the tenant offers to pay? First, you should know that Georgia law requires that you accept the rent if the tenant offers to pay all of the past due rent AND court costs within 7 days of the sheriff serving him the eviction papers. The landlord is only required, however, to do this once in any 12 month period from any one tenant. If the tenant offers to pay AFTER the answer is due or filed, you are not required to accept it, but you can if you choose to. Read more
New Generation Of Realtors – Don’t Blame Others For Doing Your Job!
We executed a lease two days ago. The agent representing the landlord throughout the entire process was too busy to conduct her side of the transaction. She called our office to write the lease, gave us the keys to do the walk through, we even faxed the landlord the lease to sign,because she wasn’t available.
Rule #1: Never allow another Realtor to write a lease if they’re representing the tenant. It’s your responsibility to protect the client you represent.
Rule #2: Don’t depend on others to do all the work for you!
The tenants are moved in, they paid the 1st months rent and gave the security. Yesterday the agent came to our office to naturally pick up her commission check.
She’s upset that the lease doesn’t show 1st, Last and security. She seems like a “Deer in the heads lights” as she explains what’s wrong!
The Conversation is as follows:
Dazed and Confused Agent: Where is the last months rent?
Me: There was no last months rent, the lease was for 1st and security only. Our commission is split with you 50/50 which has been paid. Read more
How to Retain Good Tenants
Good tenants are easy to ignore – until they tell you they are moving out. Why are they leaving? Well, it might be because you ignored them. And when tenants plan to move, it’s very, very difficult to get them to change their minds.
The reason you may ignore good tenants is that you spend so much time working on your not-so-good ones; cajoling them to clean up their acts or planning to evict them. When you are always on the phone with Average or Bad tenants A, B, and C, you quickly start thinking of Good tenant D as simply a check that comes in the mail, on time every month, like clockwork. But your good tenants are much more than that. They are human beings who:
- Understand that they are paying good money, and expect good service in return
- Notice when their building seems to be going downhill
- Recognize when they are being B.S.ed or treated disrespectfully or dismissively
On the other hand, YOU may not recognize these feelings in your good tenants, simply because they may be reluctant to share them. The complaints are more likely to come from your poorer tenants, and you may be more likely to dismiss them as a result. The good tenants are more likely to suffer in silence, before deciding to move on.It’s vitally important that you retain your good tenants, not only because they make your landlording more pleasant, but because they are so hard to replace. Once that unit is vacant, you may not re-rent it for months, and you have no idea how the next tenant will turn out. He could be just bad enough to make your life really difficult, or so bad that he only lasts for a month or two before eviction. Since your good tenants are less likely to contact you, you have to stay in touch with them. Try to get a read on their feelings by calling or emailing at least once a month. Here’s a short checklist of questions:
- Does anything need repairs in the unit?
- Are you noticing any maintenance issues in common areas?
- Do you have any suggestions for me?
- How are your neighbors?
Not only have you learned how satisfied your good tenants feel, you’ve made them feel important and wanted. Now you need to follow up by addressing their concerns, if any, sincerely and quickly. Bear in mind as you do so that you can’t get into trouble for being nicer to your good tenants than your bad ones. If a good tenant’s got a maintenance issue, generally make it your first priority – the only more important issues will relate to safety or potential for very serious problems, such as fire or water damage hazards. If a good tenant’s got a beef with a neighbor, get all the facts and deal with it right away – making sure you get the neighbor’s side of the story before making a judgment. If a good and bad tenant are having a dispute, and neither is clearly in the right, it’s okay to side with the good tenant. While you’re at it, ask your good tenants if they’re thinking about moving. Yes, that’s shockingly blunt. But it’s the only way you’ll ever find out if a tenant is planning to move before he or she actually signs a lease for another unit. Once they sign that lease, they’re gone – and no amount of cajoling is going to get them back. Read more
Disruptive Tenants
The Most Dangerous Tenant
I thought I had checked everything with this prospective tenant. He had a good report from his previous landlord. He had worked at the same company for five years. His credit was fine. And he seemed like a responsible person.
But he would turn out to be the worst tenant I ever had. He drank heavily, insulted and threatened other tenants, tried to start fights, damaged their property, and even got arrested in my parking lot for being drunk and disorderly and resisting arrest.
There are many different ways to be a bad tenant, but among the worst are disruptive people. Disruptive people, in a multifamily property, can drive all of your good tenants out and permanently damage the reputation of your building. Even in a single family or commercial building, their bad behavior can cost you a fortune in legal and other costs.
Many real estate investors start with some naïve assumptions about other people. We follow the rules and treat others with respect, so we think everybody else does as well. But if you’re going to be a successful landlord, you must prepare to deal with the worst of human nature. That means using all the screening tools at your disposal; consistently enforcing a clear set of rules; and knowing what you will do for any type of tenant infraction, as well as the steps you must follow for a legal, trouble-free eviction.
The best solution to disruptive tenants is to keep them out of your properties. I believe the first step should be to check with your local landlords’ association or REIA, which may keep a tenant database. After that you can check credit, employment, previous tenancy, and criminal behavior.
For each step in the process, there’s a right way and a wrong way. With the tenant database (and indeed all background checking steps) make sure that you’ve got the right person. Many good people have suffered because someone else with the same name misbehaved. Also remember that tenant databases often include both good and bad tenants. Check with the previous landlord, who submitted your prospect’s name, to find out what he really thought about the tenant. Read more
When to Invoke the 3 Day Eviction
I’m a landlord and I have had my share of strained relationship with my tenants. However, it has been pretty good for the most part because most of them clean up their messes, take good care of the house and pay their rent on time. They also inform me if they are having any problems with the house and leave on good terms.
However, I also have had a few really troublesome tenants every once in a while. For instance, the last tenant was really a trouble maker. I was forced to give him a 3 day eviction because he would not leave, no matter what I tried.
Normally, I do not want to give eviction notices, but I had no other choice. I had a feeling that he was going to cause trouble almost from the moment that he moved in. He seemed nice when I first met him, but he turned out to be a terrible manipulator. He was a thorn in my side for so long before the 3 day eviction.
That guy would have a story about why he could not get his rent in on time each month. It even got to a point where I would threaten him with a three day eviction every month just to get him to pay me. I gave him a lot of chances but I finally decided that enough is enough.
To tell you the truth, I heard about the 3 day eviction for the first time when his actions forced me to contact my attorney. I have to take some actions because the neighbors were complaining about a bad smell coming from the house. He was evasive at first when I asked him about it, but finally admitted that his cat had died and he had not gotten around to burying it. Read more
What To Do When Your Tenant Stops Paying Rent
It is the worst case scenario for every property owner. You rent to someone in good faith, you check and double check their references and everything checks out. But then somewhere along the line, things go wrong and the rent checks stop coming. So, what can you do? In most cases, not a whole heck of a lot.
The procedures for evicting a tenant should be clearly spelled out in the rental agreement that the tenant signed. Once they have missed X amount of rent payments, they have X amount of time to move out before you can enter their space, throw their belongings into the garbage and change the locks. But the rules are very, very different from state to state, and in some places, you need a court order to enter a tenant’s apartment or living space and remove their belongings, even if they have gone months without paying a dime in rent. If you are buying a new rental property in a state other than the one you currently live in, you will need to completely research the laws of that state and how they govern these types of situations.
Another good tip is to make out a list of “What To Do’s” when it comes to dealing with tenants who haven’t paid rent. The worst thing you can do is to treat tenant a one way and treat tenant b another way. If you have to take a tenant to court to get them thrown out, you don’t want any discrepancies on how you’ve treated the people who live in your building. Also, make sure you document everything you can so if the situation does result in a court date, you’ll be able to show the judge exactly what happened. Read more
What Does a Landlord do if a Tenant Stops Paying the Rent?
There can be nothing that a landlord fears more than a tenant who suddenly stops paying their rent. In this situation what should a landlord do? Firstly a landlord should not panic, they are not alone. There are many landlords who will have tenants who from time to time stop paying rent.
Effective monitoring system
The first thing that landlords should ensure is that they have an effective monitoring system in place so that missed payments are picked up early. Early detection is vital so that the landlord can take proactive steps to safeguard their residential investment property. With the advent of internet banking, landlords can monitor their account on a daily if not hourly basis for rental payments received. Hourly monitoring is probably excessive but certainly a weekly glance will ensure that late payments are spotted within days rather than weeks or months.
Immediate action
Once a landlord has spotted that there is a problem. They should act immediately. The landlord should either speak to the tenant or go round to their residential investment property and discuss the problem. The landlord should ascertain the tenant’s situation and the reasons for non payment and if the tenant can make a payment to bring their account up to date. By visiting the residential investment property this gives the landlord the opportunity to give the investment property a quick inspection and ensure that their residential investment property is still in good repair and nothing untoward is going on. Read more
When A Tenant Won’t Pay Rent On Time
If you have been a landlord for longer than a year, chances are you have run across a tenant who does not pay rent on time or worse, doesn’t pay the rent at all. This is a common problem for landlords and the best way to handle it is to be firm, fair and consistent with this problem tenant.
We have all experienced it. Rent is due on the first; here we are on the third and still no check. You call the tenant who tells you that “the car has broken down and needs to be fixed so I can work” or “my check doesn’t clear until Monday, I’ll have it for you then”. Monday comes and you hear “I’ll have the money on Wednesday for sure”.
As soon as you let the tenant start calling the shots, they won’t stop. Next month they will remember the power that you have relinquished and will stretch rent collection out all over again.
How should you deal with this tenant? There are several steps you can take to help them get the rent to you on time, every month.
The first step you can take is to be firm is from the start. When you sign the lease with a new tenant inform them that the rent is due on the first of the month and they will be paying late fees for every day the rent is late. Tell them that communication is key and to call you if the are going to be late with the rent. It’s up to you if you are going to give them a grace period or waive late fees the first time rent is late if it’s not habitual. This way you are the one calling the shots, not the tenant. Read more
Tenant Improvements – When Should You and When You Must Say Yes
It can be difficult or uncomfortable to respond to reasonable tenant requests. Of course there are requests that must be agreed to and some that are in your favor to do. But what about all those tenant requests from good tenants that are reasonable, but after all it’s your cost.
For the purposes of tenant improvement requests we see three different kinds of tenants.
The New Tenant: Often the requests come during the approval process or at the move in inspection. All requests having to do with a clean and functional place should be done by the move in. You want to start of your new business relationship on a good note. Nothing worse than starting an argument you know you will lose…and all those bad feelings wont help when you make a reasonable request.
Things we always say yes to:
Generally, electrical improvements are fixed and add value and marketability to the unit.
a. DSL
b. Cable
c. Hard wired outlets – Electrical needs have skyrocketed and we would rather hard wire than see too many appliances on one outlet
d. Smoke detectors – even if we are fully compliant. Cosmetic Requests to alter the unit
If the rental depends on some cosmetic changes such as paint or verticals, then its your call. We like to say yes to all reasonable changes but require that the unit be returned to its original condition on the move out. We also are careful to mention that it must be a professional job and that we provide no insurance coverage for any accidents “on the job”.
The Existing Tenant: Much of the above applies. The difference is there is less incentive to pay for cosmetics unless you want that tenant to stay.
The Disabled Tenant: Here you are bound by law and should be aware of the rules and avoid law suits you can only lose. As always, with ownership its local and the rules will be different for your area.
Federal Fair Housing Law: The federal Fair Housing Act and local fair housing laws prohibit discrimination against people because of their disability or the disability of anyone associated with them. Read more
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