All Forum Posts by: Frank Cannata

Another investor I know only does m2m on his large portfolio of class A properties. He said with a year lease, there's a deadline to make a decision - stay or go? For m2m, they just keep paying, and something has to happen to cause tenants to leave. 

@Frank Cannata I hate cash and money orders - those require me to go to the bank as I can't mobile deposit either.  I have inherited tenants who were required to pay this way and still have one I need to convert over.  

@Jennifer T. Interesting strategy, because I was thinking of doing the opposite, kind of like what @John Woodrich mentioned. What about going month to month with your tenants, and when you know they are good people with a reliable bank account, extending them to a longer lease to hopefully reduce your turnover rate? The month to month lease could be a "trial" phase to see if you want to lock those tenants in with a longer lease.

Your friend,

Nick

I typically start a new lease as a 12-month lease and then it converts to month-to-month after that.  But I do understand the "pros" of LLs that always sent their leases up as MTM.

For an inherited tenant(s) situation, I would be THRILLED if they were already on a MTM lease.  Because I don't know how the current owner screened them.  I don't know how lax the current owner is or isn't about rent/lease terms.  Rents are often below market in those situations.  With a MTM, it gives me so much more flexibility in potentially giving a 30-Day Notice to adjust rents, add/subtract lease terms, and/or weed out problem tenants.

For single family houses I ask for a year lease, for MF I put people on M2M.  Reason I put them on M2M is that it is easier to get rid of a problem tenant or a tenant who may be causing tenant/tenant drama if they are on a M2M lease.  You simply tell them you are not renewing and they have XX days to get out.  If you had a year lease and ran into issues that were outside of our lease agreement you simply couldn't kick them out.  That lease is a binding contract on both parties, they have a right to live there for a year under a annual lease.  

Your strategy may depend based on area but in my instance I don't have to worry about finding someone quickly if needed.  It isn't fun to rent places in MN during the winter however I don't have an issue in my area, this may not be the case for other areas. Also, if they want out of the lease I find it easier to let them out by having them giving me timely notice instead of leaving upset without any notice.