All Forum Posts by: Wesley W.

In my short tenure as a RE investor, inherited tenants have been my biggest "X factor" when it comes to trying to stabilize a property with regards to cash flow and return.

My advice to you would be professional but firm with them, as the initial interactions will set the perception in their minds whether you are "fly by night" pushover landlord, or someone who is running a business.  Did they once have a security deposit and it was used up with late fees, etc.?  I think their response to your request for a security deposit will speak volumes as to how they are as a tenant.

I would definitely get a security deposit and as a courtesy, incrementally increase their rent over time (you decide an appropriate pace) until it reaches what you think is fair market rent based on the unit's condition.  They will shop around and realize you are still giving them a fair price.

I can understand your need to be "fair" but you also have to protect your investment.  Be careful about setting precedents that are unhealthy for your business relationship with your tenants.

Good luck!

Absolutely  blame your insurance carrier.

I have a clause in my lease that forbids tenants from doing anything that would cause my insurance to be cancelled or would cause an increase in my insurance premiums.   That would seem to cover most of these kinds of issues. 

I also have a clause that forbids any activity that is against City ordinance or code.  In my market, that would cover this situation as well.

An ironclad lease is worth its weight in gold. 

Good luck! 

Absolutely  blame your insurance carrier.

I have a clause in my lease that forbids tenants from doing anything that would cause my insurance to be cancelled or would cause an increase in my insurance premiums.   That would seem to cover most of these kinds of issues. 

I also have a clause that forbids any activity that us against City ordinance or code.  In my market, that would cover this situation as well.

An ironclad lease is worth its weight in gold. 

Good luck! 

Since it's a line of credit, why not just park the money there until a deal comes along and evaluate then? Essentially, your HELOC is liquid as long as you are still in the draw period, and you are saving yourself some interest payments at a rate far above what you would get as "cash" in the bank.

@Patrick Liska

Yeah she signed such an agreement, but I think the blinds were down given the apartment was vacant.

@Glenn Banks

I'm going to try and source the manufacturer - thanks for the tip!

@Patrick Liska

I took copious pics, but they are all with the blinds down. :(

Lesson learned.

@Jeff Bridges

Thanks!  I'm just trying to prepare for the worst.  I've had a strained relationship with this tenant since buying the building, and she is using what's left of her security deposit as part of her rent for the last month.  I have played hardball with her since taking over, and I worry if I draw a line in the sand now (RE: the security deposit, which is only a portion of a month's rent anyways), the move out might yield more damages, if you know what I mean. She is already paying a late fee in the accounting of this last month's rent.

Her unit has to be totally rehabbed (she was in there for 10 years, it's a mess), but I'm trying to give myself an option to pursue if there are "parting shots" of additional damage in the wake of their moving (think @Brandon Turner's "rocks in the plumbing" story).

Okay this is one of those situations where I am sure there is no definitive answer, but I am interested in seeing how everyone's management styles would address this.

Abbreviated facts:

Tenant moved in on 1/1 of this year, have had a good relationship with them thusfar.  They had frozen/burst pipes this winter and just had a water heater replaced, and they were understanding with the loss of hot water for a cumulative time of about 36  hours over the two events.

She reports that one of the windows in her unit is broken and sends a phone pic.

I have a pic of my own from August (when we bought the building) showing window intact.  Since August, then-current tenant was evicted and unit was turned over by hired team.  City Code Enforcement inspects and gives CO in December.

I am reasonably sure if the window was broken, Code would have flagged it.  (They love to ding owners for that kind of stuff around here.)  Although, it's possible they missed it, however.

Lease says "tenant is responsible for broken glass."

It's the bottom sash of a double hung window - vinyl, two panes.  From a pic she sent, it has about a 6 inch crack coming in from the side - my guess it was caused by trying to open/close the window without it being square.

Choices are (that I can see):

(1) Eat the cost in the name of positive rapport, and take tenant's word that they did not cause the damage.  (Although it still may have been caused during their brief tenancy.)

(2) Cite the lease and the Code inspection, and offer to split the cost as a gesture of goodwill.

(3) Cite the lease and the Code inspection, and politely remind them that the repair will be billed to them.

Is there another choice?  How would you handle the situation?  Would your opinion change if you self managed vs. a PM?

Thanks in advance for your collective input!

@Jeff Bridges

Good to know.  Do you know how long it will take for their new address to show up on their credit report?

 Bingo!  This is the kind of empirical "gold" I am talking about!

Anyone have any others?