Landlord Organization/Filing System

[Victor Chico]

Greetings!

I am an accidental landlord hoping to become a real estate investor. I have several properties which I inherited. I have been actively reading and learning about rental properties.

I would like to hear opinions on documents that a landlord should have/keep and how to organize them properly.

As of now, I have 7 tenants. I have zero information on 6 of them except for their names. All of the tenants are currently section 8.

My plan is to have a system such as:

- Physical files - I have some idea on how to organize them, but would like to hear yours (i.e., one per tenant, one per property, etc). What should be in them?

- Digital files - A scanned copy of the paper files in a Dropbox folder, so I can share it with my partner

- Financials/Ledger - Use Quickbooks so I can quickly generate reports and also be able to input info from more than one place. I usually handle contract renovations, taxes and similar expenses. My partner lives about an hour away and he handles repairs and that sort of stuff.

I'll probably expand on this latter (i.e., give concrete examples of what I am doing or plan to do), but for now I wanted to get the ball rolling and hear your opinions on the matter. I have a very improvised system. I KNOW that if I want to grow I need a system that can grow as my number of properties/tenants increases and can be taught to others who I may have to bring in to help.

Thanks!

[Ann Bellamy]

Whether you keep paper or scanned records, isn't as important as the fact that you keep records. I'm in the process of converting to scanned records, and my scans will mirror my hard copy files.

So on the hard copy side:
1 file drawer per building, includes folders for acquisition docs, mortgage statements, tax bills, insurance bills, improvements (add to basis) and a file folder for each tenant. In the tenant files, I keep application, lease, receipt where I deposited security deposit, correspondence, etc.
2. Files for contractors such as snow removal contracts, carpenters, log for handyman, water system maintenance (I own a public water system, which most people probably don't have to bother with), etc
3. Accounts payable for each building separately, so I have the bill and the note when it was paid
4. Bank statements for each separate bank account. Since my properties are mostly in separate LLC's, I have separate bank accounts and credit or debit cards for each company. Although it is cumbersome to track multiple bank accounts, my bookkeeper doesn't have to guess which property the expense goes to, because if it was on the credit or debit card for that building, then the expense is charged to that building.

I personally use Quickbooks, but used Quicken for a long time.

I strongly recommend that you contact each tenant, knocking on the door if you have to, and get contact info. If you don't have rental records or leases, they probably don't either, but it doesn't hurt to ask. Present yourself as the manager if it's not too late, not as the owner. You'll get more cooperation if you are a working guy than if you are a building owner. If it's too late, and they know you're the owner, then just be upfront about it and ask for the information. Don't forget to ask them for receipts for security deposits. You may not get much from them, but a little bit is better than nothing.