All Forum Posts by: Kenneth T

I strongly prefer to have a 100% refundable security deposit to incentivize that the tenant takes care of the unit. Here's a fee example, which is very similar to what I already charge. The only difference being a reduction in the non-refundable move-in fee, and having to wait six months to collect the fees.

$1200  First month's rent

$1200  *Last month's rent

$1000 *Security deposit (deposit plus move-in fees cannot exceed first month's rent, FMR)

$120 *10% limit of FMR (Non-refundable move-in fees (tenant screening and cleaning fees)

First Six Payments: $1587/month [$1200 + $387 (required 6 mo payment option $1200 + $1000 + $120 = $2320)]

$1200 thereafter

@Rich N. Thank you for the comparison with Massachusetts law, which is very similar to Seattle's. That gives me confidence that I can find a way to make this work. I did a Craigslist search to see how they advertise, but it wasn't clear. (Although it was clear that Boston is extremely expensive, even more so than Seattle.) 

Do Massachusetts landlords simply max out what they can get for the deposit and other fees, then increase the rent to compensate? I had more complex solutions, like charging a variable rent, starting with a high first month's rent and then decreasing afterwards.

I've posted a few articles below which outline the new and most restrictive ("progressive") rental laws in the country, which limit the size of security deposits, non-refundable deposits, and requires giving tenants and option for a payment plan to pay move-in fees. In addition, they are also pushing a "first come first served" policy which requires that landlords grant occupancy to the first qualified applicant. Summary and links are below. I own a rental property in Seattle, so I am currently working out how to mitigate the risk created by the Seattle City Council's restrictive policies. Any comments, advice, and discussion would be great. 

• Security deposit plus move-in fees cannot exceed the amount of the first full month’s rent
• Non-refundable move-in fees are limited to only tenant screening reports, criminal background checks, credit reports, and cleaning fees.
• Total non-refundable move-in fees are limited to 10% of the first full month’s rent
• Payment Plans Required –Landlords must allow an installment plan to pay a security deposit, a pet deposit, move-in fees, and last month’s rent. The payment plan must be structured as follows, unless otherwise agreed to by the landlord and tenant. (For rental agreements of 6 months or longer—6 consecutive and equal payments)

http://www.seattletimes.com/seattle-news/politics/...

http://buildingconnections.seattle.gov/2017/01/17/...

http://www.seattletimes.com/seattle-news/politics/...

Thank you for the replies. I've since come across a California law, called the "Moore Marsden Law" which entails a perfect and fair way calculate ownership of property before and during marriage, and after divorce (should it happen). I believe that the law is in effect by default in California, but for couples in other states, it can be a great example and precedent of how to draw up a fair prenuptial agreement.

http://farzadlaw.com/family-law-appellate-decision...

https://www.sandiegodivorceattorneysblog.com/2015/...

I've been reading this forum for a while, trying to learn as much as possible about real estate investing and property management. Lately, something that I've been thinking about is how to protect my investment if I were to get married. At this rate, I expect to have my home paid off within 5 years, and I would like to protect this investment should I get married one day. I realize that this is assuming a lot, but the thought of losing property through marriage-divorce completely undermines all the hard work in investing. ie, If I can't protect my assets then I would rather just "live it up" and not bother saving and investing.

From what I've read, your separate property will be converted to community property if:
1) Your spouse lives in it.
2) If you include your spouse's name in the title.
3) If you commingle funds?

It seems like the safest strategy would be to use the property as a rental to avoid having your spouse live in it, while also generating income from the investment. And then setup a separate bank account specific and solely for depositing rents and drawing funds for the rental property. That way, all reinvestment can be drawn from the rents to prevent commingling of funds. (If you spend money from your normal paycheck to repair something in the home, does that automatically make the home community property?) And any profits can be transferred from that account to your personal account or a joint account with your spouse for general use. And of course, a prenuptial agreement to coincide with this.

Any thoughts on this strategy? Or is there a better way to protect your separate property?