All Forum Posts by: Karen Johnson

Originally posted by @Justin Seng:

When should you let an applicant know that you will require renters insurance? I already accepted a deposit to hold from my tenant and haven’t mentioned it. Is it ok to just put it in the lease and that be the first time they see it? Wouldn’t want to lose this tenant...

 When I accept a tenant, I send them a "New Tenant Acceptance Letter" (usually via e-mail).  It includes a deposit to hold agreement and any move-requirements (amount of deposit to hold and any terms or conditions associated with it, amount of move-in funds, utilities to be turned on in tenant's  name, renter's insurance, etc). This is usually the first time I mention rental insurance and it has never been an issue. Of course, I've usually mentioned that they will get something from me with next steps required before lease signing if they are accepted. I don't think most tenants are surprised or bothered by this. 

If you haven't yet, I'd suggest you read @Brendan Turner's book, "The Book on Managing Rental Properties". My acceptance letter is modeled off his. In general, it's a very useful book and can help you find answers to questions like these before they arise. There are other good books out there, but this is a pretty comprehensive one to start out with.: https://www.biggerpockets.com/store/managing-properties-physical. 

Hello, You can try www.biggerpockets.com/llforms or www.ezlandlordforms.com Best wishes.

If the tenant sues you, then your lack of a commercial activity license and a rental license can indeed become an issue. If your tenant has otherwise been problem free, I would focus less on that and more on just getting into compliance. You will also need to supply your tenant with a certificate of rental suitability. Tenant is usually required to have this within (I think) 60 days of lease starting. If they do sue you and you have not provided this, then I believe you will be liable for all rents paid plus other fees. Would suggest you try not to worry about the past, get into compliance and do your best to keep up on local rental laws going forward. You may want to change PM companies, but as others have said you will need to keep on top of things yourself. Also, consider joining HAPCO as a way to stay informed about a Philadelphia’s rental laws and network with other owners in the area.

I would not adjust the rent to account for renter’s insurance. I would simply tell them it is a new requirement. I would require them to show proof once they have it. I would also explain that the cost is cheap and far outweighed by the benefit, and that it is for their own protection in the event of something unexpected happening. I doubt a tenant would not renew over something like this (if that is your concern).

Mom is essentially co-signer on the lease. I concur with earlier comments (based on personal experience where I was in the Mom’s shoes). Mom needs to pass credit and background check and needs to sign a full lease. Mom is technically the lessee and the tenant is a legal resident. As long as she checks all the boxes and you don’t have anything against co-signers, this should be fine.

Seller financing deals can be structured in all kinds of ways - it just depends on what you and your seller agree to. You could always present your seller with multiple options - one with 100% financing and one with a down payment and see which they accept. The key is to find out what matters to your seller and try to work with that in ways that are still advantageous to you. Our last acquisition was seller financed. The seller was a family member so we got an amazing deal. However, because of the stage of life said family member was at, immediate cash on hand was valuable to them. We came to an agreement on a reasonable down payment that met their immediate needs without forcing us to give up too much of our cash reserves up front.

Strongly agree with Lisa Stewart ‘s advice above. Had something similar happen with an applicant recently. I contacted her and gave her next steps and a deadline for completion. This gave her the opportunity to move forward if she chose to (she did not) and covered me in that I was upfront about moving on to the next qualified applicant and was not stuck waiting for someone who never intended to move in. If this applicant doesn’t proceed, they are doing you a favor and sparing you problems down the line. If they do proceed, you’ve started laying the groundwork for what is and isn’t acceptable when it comes to communication.

Agree with response above. Just wanted to add that it’s quicker and easier to pay a visit to L&I when the time comes. They allow you to apply online but the system works poorly at best and you will most likely have to go there to finish the application anyway.

That was a good suggestion re.: Facebook marketplace. Lots of traffic from there and can do some prescreening using messenger. Although I will note that a lot of the people from there are also just tirekickers who click the “Is this available?” button and never respond to any messages after that. Still, it gave some good added visibility and some real prospects came out of it.

If you are not affiliated with the military, you can join Voices for America’s Troops for a $17 Fee. Members of that group are allowed to join PenFed. https://www.penfed.org/learn/ways-to-become-a-member