All Forum Posts by: Thomas Talbert

Given you also have a management company to do books for I would suggest the more expensive option of getting a management software that has accounting capabilities so that all you would have to keep track of on a spreadsheet is the management company. Simply issue each of your real estate LLC's a 1099 from the management software every year and then handle your management company spreadsheet out of the back end of the PM Software. Door Loop would be my first stop for someone of your size. I have never used it but they are built for something about your size.

Hope this helps! 

I have had a few tenants sign up for these services but with our management software the companies just deposit the funds using their portal. What some companies do and maybe something you should try is setting up a split payment schedule for them but for a fee and make a little extra scratch. - if you do this make sure it is well documented so that your eviction will not skip a beat if something goes wrong. 

Don't charge the tenant for the floor repair and replace the floors. I suggest LVP. If the tenant was there for 4 years with no qualms you have made your money back and then some. 

As a property manager in the Austin Market right now I would suggest selling. The rent rates are compressing right now and in my opinion the next 12 months are going to be rough if you do not have a enough of equity in the property. Unless you can weather a storm of bad ROI for the next few years I say you cut your losses.

A few things I would ensure you are doing in your collection Process.

1. Charge the late fee, a lot of people don't and that creates a relationship with the tenant that indicates to them that it is okay to pay late. Side note, it is considered in some states illegal to reverse late charges because it can be viewed as discriminatory for reversing one tenants late fees and not another's. 

2. Post the notice as soon as they violate the lease and it should come from a lawyer not you. Rather you like it or not we are all much more scared of a lawyer letter than an email or a note from your landlord. It shows that you mean business and will not allow any slack and will get the right people involved to inflict the most punishment possible. 

3. Charge the tenant for the lawyer bill once they pay. It is written in most leases that these are the tenant responsibility but they are rarely charged. When a tenant realizes they will have to pay late fees plus the lawyers bill (which is never cheap) they will straighten up quickly. 

4. You should not have daily late fees in your lease. It should be the max you can charge upfront. I see this all the time in leases where the initial late fee is $50 and then you have $10 a day after that. This will tell the tenant that you can be late and there's only a mild penalty, this is not what you want them to believe. In Texas, it states that anything over a 12% late fee is considered predatory. Anything underneath that is fair game. Ensure that your late fee policy is large up front with no daily late fees.  Set the largest late fee you are legally allowed and make it all at once. Once the tenant has to pay that late fee one time they will not do it again.

To answer your question more directly, start the eviction process as soon as you can and do not back off the breaks until you get payment in full. Charge the late fee and charge back the lawyer bill. If the tenant has to go through that and pay for all of that they will quickly realize you are not to be trifled with. Tenants when they get backed into a corner pay the loudest bill first. Be the loudest and most pressing bill. 

With 7 properties I would highly suggest getting a PM software to help you. These software's can run all kinds of reports and also help you with rent collection and accounting for vendors etc. I would suggest looking into Hemlane, I have worked with the CEO personally and they have a great product that I recommend to all self managing landlords. 

Hope this helps!

Be sure to call all prior landlords as well! That has saved us more than a few times. 

As a professional we have minimums for a standard 1 month security deposit then if someone doesn't meet that standard we allow for a less perfect tenant but they have to put up a greater security deposit and other fees. Our minimum Standard is 620 credit score, 3x rent in monthly income, no prior evictions, and last 3 landlord good reviews. We can make exceptions with worse credit and slightly below perfect income but under no circumstances do we allow anybody rent one of our properties with a below 500 credit score, or 2x rent income or prior evictions. 

Tenants with bad credit know it and are expecting you to ask for a larger deposit. Do not be afraid to Collateralize yourself with additional deposits to fill a vacancy. 

Jay Hartley with Frontline is awesome. Give him a call!

(817) 308 - 1309