All Forum Posts by: Erin L.

It's been awhile since I've been on but yes - and update is in order!  We are going on 15 months of the rent paid on time, every time, even 1 day early each month!  I am out of state with the military so this has been a very good outcome.  The few texts I have gotten middle of the night/wknd scary type involving frozen pipes and a dislodged p-trap under the sink were followed up by "already fixed it" and these two families in the duplex being best friends have been helping each other out while spouses deploy, etc and aren't afraid to turn a wrench when needed.  In this particular case, this is a great living situation for them and apparently is valuable enough that they put a priority on the rent.  I probably wouldn't have done this with any other tenant - it's just that I trusted my other tenant's referral very much as we have a long history.

I do $20 per day to a maximum of 10% of the rent, which is what my laws cap it at. By the day I reach 10% though I'm at a point where a pay/quit notice is being issued.

@Jordan Smith , welcome! You will find many others here by doing some searches in the same situation as you. We own a duplex and have been active duty for about 15 years. The duplex route is fantastic for someone young with not a lot of income yet because you can basically live "for free" while your tenant pays the mortgage on the building. This frees you up to pay for repairs and improvements as you go and learn DIY by having the time to put into the property since you live there full time. Also, living on site eliminates most of the problems people have with tenants before they even begin. Except paying on time, only screening a tenant properly can help prevent that. You will be able to use your VA entitlement to buy a duplex or triplex as long as you can live in the property for a year. There is a ton to learn about the process but this is probably one of the most affordable ways to jump in at your age while you learn the ropes. I would recommend doing so at your final landing location once you separate, because you will want to reside in the property for a while. I would get yourself a few books from the library on landlord/tenant books, some basic property investing books, and I mean BASIC - start there so you can learn the lingo. Then listen to all the podcasts you can while you work out, drive, or at home, they are fantastic and I find something useful even in the episodes I didn't think would apply to me :) I recommend out of a big stack of library books, pick one that seems really useful and you would refer to over and over and purchase that one. Good luck to you, many of us start just as you are and learn as we go. Great way to have someone pay for your housing while you search for your next career move after the military!

Can I just say how happy I am that I joined BiggerPockets?! Fantastic advice, everyone, thank you. In reality, the spouse has a part-time job and has minimal income, but enough to cover household things like fuel and groceries - I didn't include the spouse in my calculations, my instinct told me to run on the long term, stable income. I will be offering them the rental later today with the stipulation that payment be via direct deposit. I believe that's how they pay their current housing so I don't expect a problem. I should mention that my social media checks also reveal stable people with no drama whatsoever. These days it seems social media can be a very revealing look into how a person deals with daily life!

@Imad M. , that has generally been my experience with the military. The few bad tenants I had were the times they were not military. Our area has so much military that in 20 years I have only had 3 non-military renters. He appears to be career, and is nowhere near his high-year tenure so I know he won't be faced with being forced out due to that. I'm also lucky that I am prior military so I can tell from his uniform and command pics/medals on social media that he is a squared away guy. I think I am going to offer it to him if he can do payment via allotment. I can tell from his credit report that the idea is familiar to him, as most of his accounts are listed as "automated payment". I am learning that my "new plan" of having an iron clad screening process is always subject to other factors! I will post an update and let you know what happened.

Thanks, @Account Closed . I have been successful about 80% of the time when faced with this tenant situation going off of gut instinct plus verifying they have always placed rent payments as a priority. I think my problem is that I vowed to start having a more "ironclad" screening process but my rental market is pretty much exclusively junior enlisted military with small family - a niche that happens to have a lot of credit issues even though the income is there. I shot off a few more questions to applicant via email about the amounts of their utilities in their present situation to make sure they can handle this one. I also need to make sure they understand the differences of an apt community and my duplex, this will be their first of that type of housing so I will have to spell out things like being responsible for changing their own lightbulbs, mowing their lawn, etc! thanks again to all who offered advice!

haha @Tom V. , that's exactly what I was thinking! I know I can't but I just wanted to shake that guy and say what are you DOING?! Be nice to say we will do a 3 month lease and you have until then to read Dave, Suze, or whoever but have him do a book report on it for a 12 months lease! I used to supervise many of these types when I was in the military myself so I guess while I understand how they get sucked in to it all, I just wish they could see what they are doing to themselves. As 25 year olds they think they are entitled to drive around in new SUV's and motorcycles and are willing to pay 29% interest on their loans. Being a landlord and seeing this stuff probably explains why my poor kids have to read books like "Investing for Tweens"….

@Landon Elscott , @Tom V. , thanks to both of you for replying. I think the reason I am mulling this over is that I get a "feeling" that they would be good tenants. Also someone I trust said they "were good people". In the applicant's defense, he was honest and told me straight out what to expect credit wise, but I was still surprised as I had never seen a score that low. I would rather find a tenant sooner than later since we are military also and are due to move soon, but I'm trying not to let that affect my judgement. I did look over the whole report and it does appear to be a steady progression in the last 5 years to reduce the debt load, but there are a lot of chargeoffs from when applicant was younger and new to the military (less income) that haven't fallen off yet. I guess the bottom line is that rent-wise they haven't missed a beat in 8 years and are nice people that don't mind taking care of my 1/2 acre lot. He is friends with my current tenant in the other half of the duplex and I met him when I was in the yard, he happened to be over helping his friend do the yard work on my duplex. That first impression was a good one. I guess I will go over it with a clear head in the morning. thanks again for your insight!

Also: the prior landlords were not private small family property types, each was a large prop mgmt firm with complexes in different states, I had to give them tenant's signed release and they emailed me information, so I don't think it would be possible for the landlords to be "fake" in this instance.

I could really use some cumulative life experience advice this evening! I just used the MySmartMove site for tenant screening and was greeted with a tenant score of "conditional" with a FICO of 468. I have had both great tenants and bad tenants that had bad credit, this just happens to be the first time I am doing things the "right way" rather than solely on my judgement and phone calls. Being that I have had great tenants who were in the bankruptcy camp, I am having a hard time knowing when to take a chance and when not to.

Pros: applicant has steady military income, 4x rent amount, has resided in 2 prior residences for 3 years at each in different states, prior landlords state no notices ever served, always paid on time, would rent to them again. another factor is that my current duplex tenant (great tenant) referred the applicants and they are very motivated to live next door to their friends and be in this school district for their child. Willing to pay rent via direct deposit, the accounts they do have open have high monthly payments but they are current.

Cons: Debt/Income looks to be at 39% without rent, so about 57% with rent, credit score of 468, several past accounts that were charged off with balances below 5K, appears they like to drive new cars and are willing to finance them through "finance companies" instead of traditional bank auto loans.

Trying to do my due diligence and the credit score makes me nervous, but at the same time it looks like they place priority on paying their rent and cars… no lateness in years on those, the late ones and chargeoffs look to be dept store/credit cards and things like that. I appreciate any advice or solutions that have worked for you!

Would a month-month lease provide incentive to pay on time? I've never done anything less than 12 months and I'm moving out of state soon, not sure if that makes things potentially more difficult.