SELECTING AND GETTING RID OF TENANTS

THE TENANT SELECTION PROCESS:

1. Not checking the rental/eviction histories of a prospective tenant is apt to be a $20K or more mistake for a landlord. References from a current landlord are nearly useless:?they want to keep good tenants and get rid of bad ones. References from FORMER landlords are much better.

2. Almost as bad is renting to tenants that move frequently for reasons unrelated to apartment size or location but have no eviction history.

3. Frequent job changes, other than for increased pay or opportunity are also a bad sign.

4. The quality of cars in a parking lot is a very good indication of the quality of tenants.

5. While there are some excellent cash paying tenants, in general the absence of a checking account showing a flow of money is a strong negative.

6. Copies of credit card or other financial statements are (a) proof of credit worthiness/ability to pay and (b) generally interesting.

7. Since many tenants have gotten out of the habit of paying rent lately, or for that matter going to work, because of pandemic subsidies, there is every likelihood that from here on rent receipts are going to be impacted.?Picking good tenants is going to be even more important than ever before.

8. Don't rent to cops or lawyers of anyone familiar with the useless District Court system.?College professors and instructors are almost as bad:?they are too stupid to properly use a toilet.

GETTING RID OF BAD TENANTS

9. Starting formal eviction is a totally last resort.?The only immediate result is that the tenant will not be able to find another place to live.

10. Much better is agreeing to pay for first and last months rent and a security deposit----even a moving truck----if the tenants leave promptly with the premises in good condition.

11. This is especially true with MWRA water rates: an open faucet can cost THOUSANDS.

12.?Above all try to avoid an adversary relationship with tenants: they are in a position to hurt you much more than you are in a position to hurt them.

LENDING ON?OR BUYING RESIDENTIAL PROPERTIES:

13. Assume that any eviction in process is going to be a $30K problem

14. The better quality the tenant the lower the appropriate cap rate.?Sub normal problem tenants probably decrease the value of a property by $10,000.00 a head or raise the cap rate by three of four points. Getting rid of them sooner rather than later and replacing them with good tenants at the cost of a couple of thousand dollars @ is a good deal.

15. Unless the landlord has good tenant files with copies of eviction histories, bank and credit card statements and complete employment info. interview tenants and build these files before buying the building or making a loan and rebuild these files, or just assuem that a large portion of the tenants are goig to be bad.

16. Pay careful attention to the cars in the parking lot.?BAD CARS MEANS A HIGH CAP RATE!!!!

pl goduti

[email protected]