All Forum Posts by: Account Closed

Good Morning Sean:  

Yes, that is true.  However, this means that they won't be making any up-dates to the software program you already have.  But that's okay too.  I have many customers who still use 2012 QuickBooks for PC users and they are doing just fine. 

For example, I have a 2005 Toyota Sienna.  Because I take care of it each year it's like a new car.  Does this mean I wouldn't want to have a 2019 Jaguar?  No, it just means my car serves its purpose and I am saving money by not buying a 2019 Jaquar.

Every year QuickBooks tries to be better and tries to make it easier to use.  Making short-cuts, etc.  So do I recommend purchasing a new version of QuickBooks every three years?  Yes.  But do you really need to?  No.  It is actually a matter of choice.   

Nancy Neville

QuickBooks Simple Start is not for Landlords.  It is a money in and money out system.  If you really want to know where you stand financially anytime you want and know everything about your properties, you really need to buy QuickBooks Pro Desktop Version.  

Nancy Neville

When we are little we say to others….”When I grow up I want to be a….”

Doctor

Lawyer

Banker

President

Etc.

Then when we grow up, we realize that in order to be all the above we need to have a plan. We just don’t happen to be a whatever- we- want to be just like that. It takes a plan.

Do we attend College?

How many years?

What college?

Do I need a college degree?

Where will I get the money to fund my dream?

Yet in the Landlord Business (our Industry) people don’t view it as a business. The media, courts, tenants, family and friends, feel we are just money hungry people who care nothing about our tenants but only the money. Do they say that about Bankers, Grocery Store Owners, Doctors (well maybe doctors..bad example) plumbers, etc? Not so much. They view these industries as companies, businesses, but….. not us. And even some of us DON’T VIEW OURSELVES AS A BUSINESS!!!

I have people contacting me all the time wanting me to help them solve all their problems because they didn't have a plan. And, I try to help them as much as I can, but there is only so much I can do. Which lead me to writing this blog.

Many investors, see a sale, hear about the landlord business from others, and they get excited and so they buy a house. But they don’t know anything about being a landlord. And...most of us fit into this group, when we first began as well.

So here is my tip for those who need, want it, and glad they have it. So...here it is.

1.Location, Location, Location .

2. Check out the neighborhood before you buy. Is it a money maker neighborhood, or a bad one?

3. Check the area to see how much rent you can charge for this home in this particular area.

4. As a Realtor, when I sold properties to investors, I would tell them, from my own experience, how much money they could get in rent for this home. In return they would ask me….”Well what if I did this to the house and that to the house (spending thousands of dollars in extra’s to the house), how much could I get in rent then”, and it never ceased to amaze me, how they looked at me when I told them that they would still get $750.00 a month. They wondered how they could still only get $750.00 a month when they spent so much money on extra’s to make the house super special! The answer is this. Location, location, location. What is the market value in that area and neighborhood! It is just like buying a house. What is the market value in that area? What are they selling for?

5. Check your Landlord/Tenant Laws before you even buy a home! Very Important

6. Sit in some Landlord/Tenant Court Sessions to see what goes on.

7. Study the City Ordinances of where your properties are located. If you don’t …..be prepared to receive several tickets for things you didn't know your tenants were supposed to (you really since you are the landlord) do.

8. Get your OFFICE ORGANIZED!! I can’t believe how many investors are so focused on buying and not how to KEEP THEIR PROPERTIES or KEEP TRACK OF THEIR PROFIT AND LOSS. You can't possibly do that if you are not Organized or have an Organized Office!

9. Therefore setup a good filing system

Get a good answering system…Vonage Phone is one good example

Stamps.com is great for keeping track of letters you send your tenants.

QuickBooks is a Landlords best friend. Buy it and learn how to use it.

10. Keep in mind that this is a business of people management. You must get a feel for people and their personalities.

11. Learn what words are Legal to use in advertisements. There are many no-no words. (See my blog on What you can say and not say) to avoid discrimination lawsuits.

12. Learn how to setup your properties to have good curb appeal

13. Learn how to do open houses. Plan for them. Makes applicants excited. Competitive

14. Prepare a legal and good application form. Set a criteria for qualifying applicants.

15. Prepare a legal and good Lease Agreement. Take pictures of the home prior to renting it out and have that day's paper somewhere int he picture to depict that the photo's are current.

16. Setup a website Wordpress.com is free to advertise your rentals- generates interest.

17. Learn how to screen your applicants.

18. Learn how to do a credit report and read them

19. Learn how to choose a tenant. Beware of Testers How you speak, words you use, how you choose an applicant will make you or break you. There are testers. Do things right and you won't have to worry.

20. Don’t allow applicants to pay for their application fee by check or money order. They can cancel the checks or money order if they don’t get the place.

21. How much money do you charge for an application fee (Credit Check) $25 per person is what I charged. If they qualified I applied it to their move in fees. If they didn't qualify, it was non-refundable. Have that on your application form.

22. Only accept cash or a Cashier’s Check for credit checks and if you choose them as a tenant, make sure only cash or Cashiers Checks are acceptable, Otherwise they can stop payment on checks and money orders once they move in. PACIFIC HEIGHTS!!!!

23. Don’t allow tenants to move into the property unless they have rent and security deposits PAID IN FULL!! NEVER give anyone the keys until you have all move in fees, money due you in your hands and utilities (if they are to pay them) placed in their names.

24. How much Security Deposit can you charge. Believe it or not, your State has a law for that. Michigan is one month and half plus first month rent. What does your state say?

25. If tenants pay for utilities. make sure they have them placed in their names on the day or prior to the day you sign the lease. Call the day you sign the lease to verify that has been done. If not, DON'T RENT TO THEM, they do not follow instructions.

26. If you are a Property Manager, make sure you are a Broker, or work for a Broker who does Property Management. About 3 states say you can be a Property Manager and not work for a Broker if you a Licensed Property Manager, not a licensed Realtor or Salesperson.

27. If you are a Landlord and have a Property Manager, either let them be a Property Manager 100% or you handle everything yourself, but not do both

28. IMPORTANT: Learn the forms of your STATE !

How long do you keep your paperwork, your leases? Tenant files?

What is a Notice to Quit?

What is a Demand for Possession?

How many days does your state law require you to send that Notice to Quit?

What is a Termination of Tenancy?

How many days does your State law require you to dent that Termination of Tenancy?

What is the difference between a Notice to Quit and a Termination of Tenancy?

How do you fill them out?

How many copies do you need?

How much do they cost?

What is a Health Hazard Eviction?

When can one be sent?

What is a Writ of Restitution

How do you fill out all these forms

How many days are required for the process

How do you handle an eviction in general?

Do you change the locks on the tenants…ABSOLUTELY NO!

How do you handle a tenant who hasn't paid their rent?

How do you handle a tenant whose lease has expired?

How do you handle a tenant who won't move out

How do you handle tenants doing damages?

What type of Pets are legal rental pets?

How many people can live in a house

What to do with too many Guests in the rental home?

Unknown people on the lease?

How do you evict someone, not on the lease?

How do you handle tenants doing drugs

How do you handle noise complaints

How do you handle vehicle violations

How do you keep a tenant long term? See my blog on The Tenant Phase

To be a successful landlord, and maintain that excitement that you had when you first began, before you knew the ropes, you have to have all this in place, and you MUST AT ALL TIMES STICK TO THE RULES OF YOUR CONTRACT, YOUR LEASE AGREEMENT. Stick to the rules, and you will keep that excitement. You will keep not only your tenants happy, but you will be happy, making your family happy, and that’s what makes landlords still be landlords after 30 years in the business.

Nancy Neville

QuickBooks Online is not the best program for Landlords.  QuickBooks Pro is what you need.  

You want to be able to keep track of all details regarding your property and you can do that through the Fixed Asset Items List of QuickBooks.  (Square Feet, date of purchase, land description, etc.) 

You can customize the desktop version to whatever you want to know about whatever you want to know. 

QuickBooks Online is costly.  QuickBooks desktop version is a one time fee until you decide to upgrade.  Usually, every 3 years, depends on you. You don't have to upgrade at all if you don't want to.  

Nancy Neville

Tracie, I've tried a couple of times to post but wanted to make sure my screenshots were correct for you to use.  (Click on the images to enlarge)

I tried not to take you through the Journal Entry Process because I know how hard it can be to do Journal Entries, and so I tried taking you through the write checks and create a new invoice scenario, but it didn't deal with the old invoice or the payment received that bounced.  In the end, you would have had to make a Journal entry anyway, so my answer to you was confusing, and not completely accurate as Tracie pointed out.  

So, let's begin again.

Step 1:  THE DASTARDLY JOURNAL ENTRY

The Tenant Invoice Not Paid in the Account Column is your Accounts Receivable Accounts in your Chart of Accounts.  I renamed it Tenant Invoice Not Paid because it lets me see how much money is still owed to me at any given time.

Make sure you choose Accounts Receivable in the Account Column

Make sure you enter the rental amount in the Debit Column

Make sure you type in the tenant's name in the name column

Second Line type in the bank name or choose it from the list because we are going to backout the money that bounced.

Make sure you choose the Credit Column and type in the rental amount

Make sure you choose the tenants name in the name column

Step 2:  Billing your tenant for NSF fees and Late Fees

Because we did a journal entry for the rent that bounced, the old invoice, the original invoice is still outstanding and active.  Therefore, print that out and set it on your desk until you are ready to mail it out with this invoice. (below)

Type in the NSF And Late fees and then print it out and mail it with the rent due invoice to the tenant.

She now owes $50 on top of the rent she owes.

Step 3

In the tenant ledger, we can see the original invoice for $787.50

We see the Payment that bounced

We see the journal entry we made backing out the payment

We see the invoice for the fees we created and

to the left, we see she now owes us $837.50.

We send all the printed copies to her with a harsh letter.

Once again I apologize for trying to take a shortcut and not just showing you how to do a Journal Entry from the beginning.  It was very lazy of me.  

Nancy Neville

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QuickBooks Pro 2018.   Premier cost more and is for business who deal in inventory.  We do not.  Enterprise is the Big Daddy for really big time companies.  Cost and arm and a leg.  

QuickBooks Pro 2018 Desktop is what you need. 

Nancy Neville

In QuickBooks Desktop Version 2018 there is a button that you can click on that says Bounced Check and it will automatically back out the transaction.  If you don't have that feature in QuickBooks Online and I don't recommend Quick"Books online for landlords because it lacks many functions,  then back it out this way.

Since the bank sent back the check, this means you no longer have that money you deposited into the bank.  Therefore, you are going to have to back it out manually by writing a check to yourself in the amount of the bounced check, because you no longer have that money in the bank anymore, right?   The deposit was no good.  (HOWEVER, DO NOT CASH THAT CHECK or print it out BECAUSE YOU ARE JUST CREATING A PAPER TRAIL IN QUICKBOOKS.  The bank already did that for you in real time. (I prefer to use Transactions when doing all this verses Genral Journal Entires).  

Next,  you will create another invoice for the rent due because the tenant's check bounced and on that same invoice you will bill the tenant for the bounced check fee that the bank charged you because they made you receive a bill for what they did and therefore they need to pay you back.  You will also enter on this invoice a late fee, because their rent is now late due to the check being bounced.  So, you will have three charges on this invoices.

1.  Rent Due 

2.  NSF Bounced Check Fee

3.  Late fee

QuickBooks Online is really not a Landlord's best friend. QuickBooks Pro Desktop Version 2018 is, however.  

If you had had the QuickBooks Pro Desktop versions 2018  QuickBooks would have backed out the deposit for you,  created an invoice for you automatically to the Tenant for the rent due and the bounced check fee and all you would have had to add would be the late fee. 

Nancy Neville

Bryan, you are a "Wizard Laddie".  You are absolutely right.  

Nancy Neville