All Forum Posts by: Susan M.

Hold fee is more straight forward.  They sign a document that says this FEE is non-refundable if they back out, otherwise it becomes their deposit if they follow through and sign the lease and take possession.

Ever since I was a kid I always had more than my friends. Not because my family was rich but because I worked for it. While everyone else was hanging out, I was working. When everyone else was in college, I was working. When everyone else was just getting started at jobs and paying back college loans, my career was already taking off. Now I'm well settled in my career and have quite a nice real estate venture going.

And all my life I've always had to hide my success. When I was 16 and had a car and money to go do things, none of my other friends did. The option was to pay their way or just not go because no one else could afford it. In my twenties when I could have been having great vacations and fun, none of my friends could afford it, so again it was either pay their way or don't go. In my 30s, all of my friends were saddled with families and money and time were short, while I had plenty of time and money and no family to tie me down. Now in my 40s, people are still saddled with debt and problems and life in general and I'm doing pretty darn well, but I can't share that success with anyone.

Success is a lonely place to be unless you're surrounded by other successful people. No one wants to hear about your latest real estate deal and how well things are going when their lives aren't going as well. Or maybe it's just me that thinks they don't want to hear it, but regardless, it doesn't seem right to be happy about more success when those you are sharing it with are struggling. 

I just closed on another deal yesterday and was really excited.  Maybe I'm needy but I wanted someone else to be happy with me, for me, but could ultimately only share with my husband and Mom and my Mom doesn't really get it but she's my Mom so she's happy for me.

Do others have this problem? I am really starting to see now why it's important to find other people with the same interests and success and to surround yourself by them. I am going to seek out others in this coming year at REIA meetings because it's becoming increasingly difficult to continue to be successful yet feel somewhat guilty about it.

Bao, I could have written your original post myself.  I am in exactly the same situation and not long ago said to our realtor "I feel bad, you keep showing us all these properties but they just don't work out" and he responded with "that's OK, you're a good client and that's my job", but I'm only a good client when the ratios of show to sell is in my favor, and that ratio is quickly dropping!  And he hasn't been all that enthusiastic lately, to be honest. I too think it would be so much easier to just work with the listing agent but I feel guilty for dropping our realtor out of the picture at this point.  

There are two places I want to look at right now and I'm hesitating because I don't know if I'll buy either one and I hate asking my realtor to show me more properties, again.

I'm sure that a frank conversation would solve the problem but I don't know if my realtor would be honest.  He's a friend too, so that complicates the matter.  If I went behind his back it's almost a guarantee that *this* would be the one I would buy, and he'd be angry and I wouldn't blame him.

I just don't know the right solution, so no help here really, just the same situation.

We had a tenant like that, although he didn't pay late fees.  I know it's annoying, but as long as yours is paying late fees I'd probably let it go, but not renew the lease at the end of the term if it really bothers you. Otherwise, extra income!!

Lisa, it sounds like a good deal to me but I'm certainly not as expert as some around here.

We are pulling in nearly exact numbers on condo purchases and we're quite happy. Some investors hate the idea of condos due to the uncertainty with the HOA. Since this was an impulse buy for you, that could be your biggest risk. Do you have any idea what the history of their fee has been? Has it been relatively steady, or are they constantly raising it? That can eat into profits fast. If you see bad things going on you might want to look into getting involved on the board, or at least being an active member. Otherwise, as long as your development is "renter friendly" and they're managed fairly well so that repairs are being done and the place in general is in good shape, sounds like a winner to me. Congratulations!

I pieced my hold fee agreement together from bits and pieces I found all over the internet, so I wouldn't be comfortable sharing it since I have no idea about it's actual legality. Google "holding fee agreement". I'm sure you'll find samples, unless someone here has one that's actually been reviewed by an attorney.

Regarding length of lease, if they are really good qualified tenants, go for a 13 or 14 month lease. Don't offer a discount unless they balk.  It's highly likely they're not real thrilled about moving in January either so a spring lease is win/win. If they're sketchy, go for 6 months.

There was just a good thread about this the other day too:

http://www.biggerpockets.com/forums/52/topics/151828-which-online-rent-collection-service-do-you-recommend

I have held places for the right tenants, and use a "hold fee" (do not use the word "deposit" as deposits are refundable) and hold fee agreement for these situations.  My Hold Fee Agreement basically states that both parties agree that the unit will be taken off the market for this applicant in exchange for the hold fee.  If the applicant defaults, I keep the fee due to my lost ability to rent the place during the time I've held it for them.  If I default, they get their money back.

If they fulfill all rental requirements (pay me all money due, get utilities transferred, sign the lease , etc) then their hold fee converts to their security deposit.

I know many landlords that absolutely refuse to hold places for people and maybe in some markets you can get away with that, but in my market most people shop for a new place a month in advance, so if you don't hold the place at least a couple of weeks you're not going to get any tenants.  I've heard of other landlords whose policy is "until you sign a lease and pay the place is not yours".  If you can get away with that, great.  I can't.  That basically means you have a tenant paying for their current place and your place during overlapping weeks.  No one in my area would agree to that but apparently in hot markets you can get away with it.

I was going to suggest this as well. In our state you have to pay interest on any deposit over one month's rent so know your laws. I also know that asking double deposit in my area would remove 99% of my applicant pool.

I now either do month to month with risky tenants or I offer 'early lease termination' for good tenants with a fee that is generally 1.5 times my rent which makes letting them out of their lease early worth it to me and it's an easy out for them. Another forum I belong to has a member whose tag line is 'find out what people want and let them pay you for it'. If people want an 'out' on a lease, give it to them, for a fee.

I just wanted to report back that IPN did approve me to receive payments just by entering my personal information in the business name area. So if any other individual wants to use it, it's no problem, you don't have to be a business.