I have to vent ! About a Tenant

[mmurphy]

deepndirt, try not to act like you care about them when you meet them for first time. Make your self appear to be a real ***** before signing a contract. More then likely they will not care to treat you that way when they stiff you.

I kind of went over a few of moms contracts and made her change her way of doing things. .. No more letting them give half deposits or allowing them a couple weeks leeway when they first move in.... All utilities in there name before handing keys over is a must, or you could be paying there heat bill all winter while getting no rent. If they are over 5 days over due on rent extra charge, actually set rent at amount and on time was less then that. It is no fun. Deadbeats have alot more protections then a responsible man or woman.

 

[teg]

sorry for the long rant

Now if ANY one needed to rant... You win!! Sorry for your troubles, you were good to them but got the shaft in the end...

 

[brin]

Deep,

For what it is worth I have been in real estate for 40 yrs. and a Broker for 35 of those..after all of these years and dealing with tenants in my humble opinion, it is a gut call as to whether or not to rent to a tenant. References are worthless, who is going to give you a reference to call if they know they will give them a bad one ? Security deposits are worthless, one months rent and the the tenant usually does not pay the last months rent on the lease so they get their deposit and leave you with the mess and damages ! Credit checks are absolutely worthless since that is only past behavior and by the time you get them as renters , their world has changed and credit reports only pick up credit cards and loans as a rule along with consumer debt..

The tenant interview is the best based on my experience...you have to go with your gut feeling. I have let tenants move in with no security deposit and no first months rent in exchange for them doing repairs and me buying the materials and had it work out great and when they left , they left it neat and clean and I have had the other but no credit check, security deposit or first months rent will ever save you so don't beat yourself up..

 

[deepNdirt]

yeah! I suppose I will have to toughen up on the next Tenants, Although as things have gotten in todays time some of us can't be too choosy who we get to move in, We have HOA and City with their code enforcements breathing down our necks to keep the vacant properties clean, painted and presentable while we search for the ideal tenants to move in, Our properties can become vandalized which has in fact happen to that house a few times, one time ripping the copper wiring and set line to the A/C unit completely out from under the house, But does the City understand about these kind of costly setbacks? No! they just want to add salt to the wound threatening to fine me if I don't put a New roof and paint on it, I suppose is only pressure on them from the HOA, I always cut the grass once each week, ......................................
I really don't know why I keep it?
all funds made from it goes back in to pay the taxes, I guess why I hold onto it is because not too many more years I'll be semi retirement and was hoping to have it as a supplemented income, actually in my slow business with the house building industry I had hoped the rental of this house could help pull us through, but again having tenants like this is no way to live a healthy relaxed lifestyle :confused2:
BTW this house is my wife and I first purchased home we lived in it for 25 years while paying for it before building our new one, and now would sure be nice to have steady income to help finish paying for this one,
But I'm sure I'm not alone in this sort of dilemma

 

[Richard]

He was such a private person he fought me tooth and nail before he finally agreed...I had all new insulated windows, doors installed , new paint throughout , refinished hardwood floors, new kitchen cabinets, sink, counters, stove , refrigerator, floor and then in the bath, new tub & shower unit, new vanity, tile, toilet etc. and then I had some structural issues taken care of ...He acted like it was an inconvenience the whole time and never even thanked me...I won't say anymore...except I am disappointed in this person..

I wish I once had you...

My wife found a duplex once. Built around 1945 and the original tenant had just gone into a nursing home so we were the second people to ever live in it.

Stayed there about 8 years. This duplex had ZERO A/C system other than open windows so I put a window unit in. About 3 years into it, the landlord said he was going to install central air "this summer". I said great!

This of course, never happend (fine)

We finished our house and it became time for us to plan our move. We were about 30 days early in giving our notice. ( I told the wife we wait until we have a DATE to move in, THEN give 30 day notice....she wanted it given "now" and of course, we had some delays)

They undertandably wanted to show it to potentail new people (fine)

He then said he wanted to gain access to prepare the place for the new people (I had maybe 3 weeks left on my notice). He went on to say that he wanted to install central air (the very A/C that he promised me years prior)

I said "I can be out by the end of THIS WEEK if you would like me to?"
(we had been osmosing things over to the house so had very little left here)

He said GREAT!

I then said "I presume you will refund me the balance of the months rent if I leave early so you can make your improvements?"

He stood there with the deer in the headlights look on his face.

"No"

So, I changed my mind and said Well then,no, you do NOT have permission to enter my place to do upgrades. (lease stipulated he had access to the place to only do "maintainence" and adding central air certainly isn't maintainenece!)

The spit & venom face that came across him was very interesting. Seems it is FINE for me to leave early as long as he gets to keep the money and accomodate the new tennant with something he promised me. But after 8 years of payments on time (or more likely, keeping a MONTH or TWO ahead in case I ever had some financial bumps) he wanted to keep his money AND have the access?

I would have happily been out of there in 24 hours but it would have meant busting my butt to do so. I was not going to bust my butt just to make his life easier while I had several weeks remaining on my notice.

We osmosed out as planned and I left the keys in the mailbox on the last day as agreed.

He could have had 3 weeks to prepare instead of basically, zero days.

If he wants to impose on a tenant, he can impose on the new person who's going to benefit from the improvements.

 

[tglass]

years ago I bought my first house and years later we moved because of employment and other reasons. Rented my house. And other than the remaning house payment, ins., and usual cost of renting did not charge a cent more just to break even. Rented at a fraction of the cost of usual rental, and still had the bad happen. Finally paid it off and sold it just to get rid of it before non paying renters, repairs directly related to the renter themselves and the usual maintanence repairs cost more than it was worth. And always want their deposit to cover their last month of living there's cost. well, not so with me. a deposit is to cover damages (and yes, I expect some from normal wear and time) but that is not always how courts look at it and most of the time not worth their time or your money trying to recover your money spent on the recovery. Why I do not rent! There are still some good people, but renter beware.

 

[nickel plate]

brin, the tenant paid 216 mortgage payments to you without one complaint (your original post stated none) in eighteen years! There are tens of thousands of home rental individuals that would take your tennant in a moment's notice. You seem to be quite disturbed that the past tennant/plumber presented a momentary inconvenience to you selecting and positioning your next tennant. 6480 days of the plumber paying rent and you are upset for him costing you a couple of days of inoccupancy?

 

[tungularafishcamp]

In over 30 years of having rentals I have seen a few things good, bad, n inbetween. Remember it is a business arrangement because that is how the tenant thinks of it. After many years with the same renter you can think it is more sometimes but it probably isn't, they just wanna stay on your good side for the next time the rent is late or whatever catastrophe happens:laughing:

What is that ole saw bout if you can count your true friends on most of one hand then you are a rich man. That doesn't count TBN friends:laughing:
Rick

 

[kenstrac]

My wife and I was watching the news in Boston last night and they were doing a story about people shopping for there kids in a toy store.
They interviewed a woman with a bunch of expensive electronic toys in her carriage,they asked her if she was spending more this year then last she replied yes and added to pay for it she would just come up short on the rent.

 

[Cat_Driver]

The banks have it even worse. People are leaving their foreclosed homes and either taking or destroying everything they can take including lights, appliances, tub, sink etc.

What some have done is strip the house and sell everything including the windows before the foreclosure.

Others have taken all the electrical wire for the copper, and pipes and left nothing but a shell.

I stopped renting years ago. I had three homes rented 2 left the place immaculate but one tenant moved in paid the first month and deposit and never made another payment and it took 6 months to get them out. When they left they had holes punched in every wall, windows broken, doors down, cat & dog mess all over the carpet. I saw that and got out of the business.

Some people know the system and know it takes so long to get them out so they game the system.

 

[brin]

brin, the tenant paid 216 mortgage payments to you without one complaint (your original post stated none) in eighteen years! There are tens of thousands of home rental individuals that would take your tennant in a moment's notice. You seem to be quite disturbed that the past tennant/plumber presented a momentary inconvenience to you selecting and positioning your next tennant. 6480 days of the plumber paying rent and you are upset for him costing you a couple of days of inoccupancy?

nickle plate....If you really read my previous posts you would see that I had to coerce him into letting me upgrade the whole house eight years ago...So he had been there ten years and I completely remodeled the house and left his rent the same. Over the years I had helped this tenant find work on numerous occasions and done other favors for him so I am guilty of thinking he would be a bit friendlier toward me, I am also guilty of thinking he would live up to his word and keep me informed as to the status of his move and if indeed he was approved for his mortgage and would even be moving...He never called ...I had to keep calling him..He left the house a mess and never finished some work he had agreed to do on it.

So nickle, yes I am disappointed in him. As to him staying in the house for 18 yrs....that was his choice, it is a nice house in a beautiful private setting so why should that give him an excuse to not keep his word or at least be courteous and considerate..

 

[Riderguy]

The banks have it even worse. People are leaving their foreclosed homes and either taking or destroying everything they can take including lights, appliances, tub, sink etc.

What some have done is strip the house and sell everything including the windows before the foreclosure.

Others have taken all the electrical wire for the copper, and pipes and left nothing but a shell.

I can't feel sorry for the banks. These homeowners are basically tenents that didn't have enough money to rent a house much less buy one, yet were offered a ridiculous no-money-down mortgage. The banks approved them, and then wonder why the house is trashed when foreclosure is imposed on the property.

When it comes to human nature I try to subscribe to the adage: Given the opportunity, people will disappoint you.

I'm not negative, just a realist. When it comes to family, don't get me started!BTW, a statistic floating around says 80% of money loaned to a family member is never repayed. How's that for disappointment?

Scott

 

[Richard]

I've been biting my tongue on saying the next thing, lest it come across as some kind of a sales pitch and I don't want that to happen.

I do not know how much someone might make in net rental income after expenses (but perhaps before income taxes). Do you make 3%, 6%, 25%?

I know that in part depends on what if any loan you might have on the place and how much of the rental income goes towards paying the loan.

ok, so with that said.... you can avoid some of the headaches of owning rentals.

You can look at non-traded REITS (Real Estate Investment Trusts). Their goal is stability of principle, income and growth.

Right now, with one I know of, you can get 6 1/2% annual cash flow. Of this cash flow about 30% of it is tax favored because the REIT passes 100% of their depreciation through to the shareholders.

This is with zero mortgages, zero maintainence calls, zero tenants to deal with.... all of that is done for you. You simply do some appropriate research and if appropriate to your goals, write a check.

If you feel real estate is depressed right now then it could be an interesting time to look into something like this. (after proper research, reading the prospectus, talking to your accountant, blah blah blah...).

The way this specific one works is they take the funds, go out to buy either medical related buildings (hospitals, clinics, Dr's offices, nursing homes....) OR they buy apartment buildings. These are pretty specific in their asset base.

They buy the properties with plans of holding them for 7-8 years. During this time, they are (currently) paying 6 1/2%. These shares are cumulative and here's what I think is so interesting with them.

On the backside when they liquidate the properties, the company is allowed to keep 15% of the profits AFTER they meet two criteria:

1. They must first reimburse you 100% of your invested funds
2. They must cover ANY shortfall from what ever interest they have been paying you and 8%. If they fail to meet these, then they don't split the pie.

Once they meet those two criteria then they get to split what is left 85/15 with you getting 85% of the net growth. This means you have 100% return of principle, 8% simple interest for each year held (with tax favors) and then 85% of remaining profits (if any).

If someone thinks real estate might rebound over the next 5-10 years then it's something worth looking into.

Just so no one thinks I'm trying to do a subtle sales pitch, the company I use is Grubb & Ellis

Grubb & Ellis :: Healthcare II REIT :: Home

contact your investment advisor if you have any questions. This is not something exclusive to me.


Some nice features:

* Tax favored income
* Chance for growth
* Though there is a declining surrender charge, per the prospectus, after 4 full years of ownership, they are required to pay you "but in no event, less than 100% of the price paid per share" if you decide to totally liquidate and get out. (of course this means you are walking away from any potential real estate growth)

and the last thing I'll mention is, death. If something happens to a landlord and you die, then the rental place will have to go through probate. If the decision is made to sell then there are other issues with that. With something like this REIT, they have a clause that upon death, the beneficiaries have up to two years to decide if they want to keep the asset or liquidate it. If they decide to liquidate it then all surrender charges are waived.

If the shares are in an appropriately titled account or trust, they can bypass probate.

Oh, and you can reinvest the income at a discount if you prefer growth over income

 

[bdeboer]

I can't feel sorry for the banks. These homeowners are basically tenents that didn't have enough money to rent a house much less buy one, yet were offered a ridiculous no-money-down mortgage. The banks approved them, and then wonder why the house is trashed when foreclosure is imposed on the property.
Scott

Well said.

 

[bdeboer]

Deep,

For what it is worth I have been in real estate for 40 yrs. and a Broker for 35 of those..after all of these years and dealing with tenants in my humble opinion, it is a gut call as to whether or not to rent to a tenant. References are worthless, who is going to give you a reference to call if they know they will give them a bad one ? Security deposits are worthless, one months rent and the the tenant usually does not pay the last months rent on the lease so they get their deposit and leave you with the mess and damages ! Credit checks are absolutely worthless since that is only past behavior and by the time you get them as renters , their world has changed and credit reports only pick up credit cards and loans as a rule along with consumer debt..

The tenant interview is the best based on my experience...you have to go with your gut feeling. I have let tenants move in with no security deposit and no first months rent in exchange for them doing repairs and me buying the materials and had it work out great and when they left , they left it neat and clean and I have had the other but no credit check, security deposit or first months rent will ever save you so don't beat yourself up..

Even asking the current landlord doesn't work, as they will dump a slow pay or high maintenance renter by giving a good reference.

 

[brin]

Even asking the current landlord doesn't work, as they will dump a slow pay or high maintenance renter by giving a good reference.

bdeboer, So true what you say...the old landlord is just glad to get rid of them and gives a good reference to be sure they move...Ahh, the games they play !

 

[NorTracNY]

brin,
You talk about upgrading when he didn't want it. Why should he feel appreciative? I know that when I was single and rented, I didn't want the landlord coming in and disturbing me. You talk about helping him get jobs. He may just have seen it as you trying your best to keep a good tenant that paid the rent! When I had a business and rented, it was always a balance for the landlord on rent price versus me leaving for another location. This probably came into play too.

Clearly he was not a man of his word, but we all deal with them every day. Vent away, but I can't seem to find an ounce of sympathy. As you're aware, things can be A LOT worse for landlords.

 

[brin]

brin,
You talk about upgrading when he didn't want it. Why should he feel appreciative? I know that when I was single and rented, I didn't want the landlord coming in and disturbing me. You talk about helping him get jobs. He may just have seen it as you trying your best to keep a good tenant that paid the rent! When I had a business and rented, it was always a balance for the landlord on rent price versus me leaving for another location. This probably came into play too.

Clearly he was not a man of his word, but we all deal with them every day. Vent away, but I can't seem to find an ounce of sympathy. As you're aware, things can be A LOT worse for landlords.

NortracNY....Hey sport...did you notice I never asked for your pity or anyone else s --- Character is the issue here...think about it !

 

[bdeboer]

bdeboer, So true what you say...the old landlord is just glad to get rid of them and gives a good reference to be sure they move...Ahh, the games they play !

It has happened to me. Not a total deadbeat, but one that you have to chase down every month to get paid. When you look at the eviction process once you start, you can plan on 3 months no money plus court costs etc. Then a month to get the place rented and in shape again. Plus you have little chance of collecting the back rent. I know why they do it even if I do not agree with it.

 

[brin]

It has happened to me. Not a total deadbeat, but one that you have to chase down every month to get paid. When you look at the eviction process once you start, you can plan on 3 months no money plus court costs etc. Then a month to get the place rented and in shape again. Plus you have little chance of collecting the back rent. I know why they do it even if I do not agree with it.

Yep ..it really is a crap shoot when you choose a tenant...All of the credit checks, one month rent security deposits in the world and you can still end up losing months of rent and have a trashed property...so that is why I say in the end you just have to evaluate each prospective tenant, how they present themselves and go with your gut based on past experience. A prospective tenant will never give you bad references and credit checks do not reveal bad tenant histories or past due rents..