But My Rental Mortgage is Due On the 1st!

Isn’t that right? Don’t you have to make your mortgage payment on the first and that’s why it’s so important to get the tenants rent check in immediately?

Well, did you know you can ask most lenders for the payment to be on a different date? You can even make it mid month if that takes extra stress off of you. Now be warned, the bank may want to charge you slightly more for the privilege of changing payment dates to something that works for you, but if you are a good customer, it might be negotiated away.

The biggest bonus for using this tactic is you will have a large window of notice if a tenant bounces a check and you have plenty of time to ensure your payments are covered. If for some reason you don’t already have a float to cover you in place that is.

Rent Is Due On The 1st! Because My Rental Mortgages Are Too!

This is actually another fallacy that most landlords fall into because they have to make rental mortgage payments on the 1st. Sure it’s easier for you as the landlord to track, but occasionally you will run into a tenant who is stuck in a weird payroll schedule and receives their check on the 5th or some other date.

If you have a tenant like this, you need to make a judgment call. If your mortgage payment date isn’t the first, you can be flexible and allow the tenant to make payments on an alternate date, decided by you and the tenant and then backed up in writing. The question is, how much extra work will this be?

Sure it can be a nice thing to do for a GREAT tenant, but now you have to make a second trip to the bank, which may not be much of a hassle. Unless you have multiple properties and now have to stop at the bank on the 1st, 3rd, 5th and 8th, just because you are so flexible with your tenants.

Understand Your Rental Mortgage Options

So before you commit yourself to some crazy banking schedule, determine whether it’s worth it, whether it’s a perk you can offer some people or whether you are just creating more work. Then again, if you changed all the days your mortgage are due to the 15th, maybe you would still only make one trip to the bank!

You Want it Early?

Not getting security or damage deposits and rent before new tenants move in is one of the most common problems I hear about, and it’s one of the most common pitfalls that new and even experienced landlords run into.

You’ve finally narrowed down your list of prospective tenants to the one that best fits your criteria.

All that’s left now is to get the appropriate security, and damage deposits along with first months (or last month’s depending on where you live and local rules) rent from them to move forward. Now depending on the applicable residential tenancy laws in your area, this can entail first month’s rent and a security deposit or possibly first and last month’s variation. Which ever the case, here is where the problems start.

You meet with the tenant to get the security deposit or first and last month’s rent for the property and they tell you they don’t have it all yet. The most common reasons?

Their previous landlord hasn’t returned their deposit to them yet or perhaps they are just waiting for their next check. Sorry, this is a definite warning sign in my eyes.

When it comes to security deposits, there is more than one security deposit in the world.

It’s not your problem to they don’t have their full deposit back from their previous property. Most importantly if it isn’t in your hands before the tenant moves in, they NEVER EVER should get in your property.

Same with first and last month’s rent where applicable. These payments are absolutely required to be in your possession before they take possession of your property. Failure to do this can be an expensive lesson.

If you’ve never heard this before it needs to be said, LOUDLY!  No one should ever get into your property until all the appropriate rent, deposits and payments are made up front and in cash. If you don’t receive the initial payments in cash, you shouldn’t release the keys!

This Tip About Getting Deposits Early Could Save You $1,000

If your local laws allow security or damage deposits, be careful how you write the receipt. Again this can vary from region to region, so you may want to check with the local landlord and tenant representation to confirm if this applies to you.

If the receipt says security deposit and they decide not to rent from you, you typically have to return the entire deposit. If however, you write it out as “deposit against first month’s rent”, it is no longer a security deposit and you have leverage, in this case their cash, if they back out.

There are always extenuating circumstances and ultimately the call is up to you. However, if a tenant commits to you, you turn away other potential renters and are left with a vacant property when they change their mind, you shouldn’t have to cover the entire costs of re-advertising, recontacting potential renters and even paying for new credit checks.

Often, you can keep the entire deposit, or only return a portion to offset your costs, if the laws in your local region allow this and it’s not referred to as a security deposit. So know your local rights!

Understand Local Rules Regarding Getting Deposits Early

Real Estate is a business, it’s ok to be nice, but you have to protect yourself and ensure you don’t get taken advantage of. Hope this saves you some future headaches!

Your Actions Dictate The Future

Just a quick potential revelation for you to think about when it comes to your tenant relationships. Think carefully about this next statement.

How you deal with your tenants when
issues arise sets the precedent for future interactions.

This applies to both sides of the interaction. My first example is how you react if the tenant has a problem like a broken appliance or problem with the property.

If you stall dealing with it, avoid getting back to the tenant, drag out the repairs or take shortcuts in dealing with the problem, the tenant will see this. That sets the precedent and in the future they believe you don’t care much about the property and by association them.

Be A Professional, Not An Amateur

Contrast this with reacting immediately, getting someone in to deal with it as quickly as possible, getting it resolved fast and keeping the tenant updated as to the progress or if there are delays. You have set the stage as someone who is professional, concerned about both the tenant and the property and you stand out from the crowd.

My second example will likely hit home to many of you who found me due to having to deal with problem tenants.

How you deal with excuses, missed payments and tenant issues sets a huge precedent. Telling tenants a late payment is ok sets a horrible precedent! Getting notice of a returned check from your bank and not immediately contacting the tenant is bad for your future!

Issues like these need to be addressed, penalized where necessary (and legal) and shown how they are an issue. Or they will reoccur!

To show you are serious, if this occurs with one of your tenants in the future, you need to write or type up a notice to the tenant explaining to them the issues. You don’t need to be a jerk, but you need to set the precedent that late, missed or NSF checks are unacceptable and if the practice continues you will take action.

Now sometimes these incidents just happen and they may be out of the tenants control, that’s why you shouldn’t be a jerk about it, but you have to set the precedent!

Good Tenant Relationships Help You

Long term, by establishing good tenant relationships you get rewarded with loyal long term tenants. And referrals. And less headaches.

Any of those bonuses are always great so setting yourself up for all three really can make your job as a landlord easier.

Here’s another article showing what happens when you have great tenant relationships, Thank You For Being Such an Awesome Landlord

What’s Your Email?

Don’t worry this is rhetorical, but important and relates to your privacy.

You see, email can be a great way to stay in contact with tenants, send them updates and to get updates from them, but you really need to make sure the email address you use as a landlord is different than your normal email. For privacy reasons!

Be a Mystery And Protect Your Privacy

I’m probably a poor example of part of this, which I’ll explain in a moment, but here is what you need to know. Ideally you don’t want tenants to know where you live and to know as little of your personal life as possible. In fact, many sophisticated landlords don’t even tell the tenants they are the owners, they just tell them they manage it for the owners.

It moves you one step back, lets you still call the shots, it stops you from being the bad guy/girl if there is an issue or a rent increase. It’s “the owner” who is calling the shots, you’re just the manager, all while you protect your privacy a bit!

This brings me back to the email. If you advertise on some online platforms, they are nice enough to allow visitors to see your other ads as well. This is all tracked by the email address you sign up with, so if you use the same email for personal items and rental properties, tenants can potentially find out way to much about you.

I recently ran into this with a new landlord I was coaching. I checked out their ad and then followed their other ads to find out all the other items they were selling. This could lead to tenants getting your home phone number, your home address and basically just knowing too much about you.

As I mentioned, I’m not much of a mystery and as such I am a poor example of this in action. If you were to search my name you find thousands of references to me (I think they are all good!), but it’s because I am very active online, have multiple websites and hundreds of posts and articles online.

In this case, do as I say, please don’t do as I do!

Let’s Talk Facebook Privacy

Please please please don’t friend tenants on Facebook or any other Social Networks, there is simply to much opportunity for them to learn too much about you.

Start By Making Life Easy For Tenants

Tenants really just want a place they can call home and a landlord they feel will look after them. By portraying yourself as a professional landlord, part of this can easily be accomplished.

If you come across as proficient and prepared it will help allay many of the fears tenants have, so here is a handy tip to help you with that.

We have an Emergency Call Number list that we install in every property inside the kitchen cupboard closest to the phone jack. This list has your standard emergency numbers like 911, the local police, non-emergency ambulance, fire department, poison centre, gas and electrical troublelines and of course our contact numbers listed at the bottom.

It’s a simple thing, but it’s just a little bit of comfort for a tenant and is incredibly easy to do. It’s also no accident that we are at the bottom of the list. If there is a fire, or emergency, we want to be called after the appropriate emergency people are called.

Advanced Professional Landlord Tip(s)

If you want to take this to the next level, print these sheets up and take them to Staples or Kinkos or an equivalent office place and have them laminated. We do this and then attach velcro to the backs and in the cupboard so we can easily change them out later if needed. This way they look more professional, they are more durable and it creates a better impression.

Also, if you have certain contractors you deal with all the time, such as a plumber or appliance repair person, include their numbers on there as well. All our tenants have access directly to our plumber and he even has a master key to all of our properties in case of emergencies.

You may want to have an arrangement in place ahead of time, but our plumber knows that if it’s general wear and tear causing the plumbing issues he bills us, if it is a tenant issue (ever had a child’s toy clog a toilet?), he bills the tenant directly.

Can You Be a Professional Landlord?

Do you think this is something you can implement immediately to help establish yourself as a professional landlord? Tell me your thoughts and if you have any additional suggestions or improvements let us know!!

Having contractors you trust makes a huge difference in your landlord business. It’s not always the best price, but it’s always the best relationships that help you succeed.