Rental Income While Cruising

[belizesailor]

Originally Posted by phairest

Back to my boarder vs tenant convo...

From what I've read it seems that a boarder has very limited rights compared to a tenant. Everything I've read indicates that a boarder can be put out immediately when their money runs out, or at the outside with as much notice as they pay for at a time, and one can do so for any reason. On the other hand, you must have some legally valid reason to evict a tenant, and they must be given notice upon notice and are a living hell to forcibly evict, probably wrecking the property also and definitely costing you in unpaid rent while the process drags. Also, when initially choosing, it seems an owner has a lot less restrictions with boarders; e.g. it's illegal to screen tenants based on whether or not they have kids and whatever else, but with boarders anything goes. It's also an attractive option to me because it lets me keep "a foot on land" for storage/visiting, and if my sailing venture goes all to hell I have a fallback.

There are cons as well of course- boarder rent would almost certainly be less than if one rented out the entire property for exclusive use. And the boarder could potentially steal/wreck the owner's stuff in the dwelling, but that could be covered by my HO or a required renters insurance policy for them. And maybe other things I haven't thought of...??

All this is heavily dependent on State law. So, I would discuss with an attorney from the corresponding State.

For example, California is absurd, but in Texas it is relativley straight forward to evict.

[belizesailor]

Originally Posted by skipmac

...

But he got burned by a real pro last year. Single women with one daughter, applied. She was well dressed, good story, good references including a letter on a law firm's letterhead that checked out with a phone call. Whole thing turned out to be a fraud. She moved in with a couple of adult daughters, one with several kids, a house full of cats, piled junk all over the front yard and had a constant stream of noisy visitors at all hours. Stopped paying rent after the first month, stayed 6 months and moved out 2 days before the police showed up with an eviction notice and warrants for one of the daughters and one of the boyfriends.

But that's the horror story. I think the guy said this is only the second time he's ever had a problem and he has about 15 houses.

Been there done that. Just recently had a similar tenant. She knew the game and played it for all it was worth and then bailed at the last minute. PM called her refs and they checked out. Later, attorney confirmed it was all bogus and she had a rap sheet a mile long, including several evictions and felony convictions. Cost me almost $10K all total in lost revenue, legal expenses, and clean up. From now on everyone gets a real background check....very easy and inexpensive to do these days.

But as you say, these are the exceptions not the rule. Just be sure and protect yourself against the exceptions.

[BandB]

Originally Posted by belizesailor

Been there done that. Just recently had a similar tenant. She knew the game and played it for all it was worth and then bailed at the last minute. PM called her refs and they checked out. Later, attorney confirmed it was all bogus and she had a rap sheet a mile long, including several evictions and felony convictions. Cost me almost $10K all total in lost revenue, legal expenses, and clean up. From now on everyone gets a real background check....very easy and inexpensive to do these days.

But as you say, these are the exceptions not the rule. Just be sure and protect yourself against the exceptions.

Apartment complexes and management companies run credit and background, or have them run by agencies they use to screen, but the most meaningful thing is rental history. In this area, the make sure to contact the two most recent landlords at a minimum. Previous history as a tenant is the best indication of what to expect. In this area, if you've been evicted or left without paying all monies due, you will not be able to rent in any reputable apartment complex or from any reputable management company.

Now that's also the reason that private individuals will see more of these offenders. They know they're blacklisted basically in other areas so they go for renting from individuals they hope don't check. Bad tenants do it over and over again.

[thinwater]

Originally Posted by Cowboy Sailer

Consider renting to military personnel at a discount. They don't skip out owing you rent. We had bad renters but never from the military.

I have.

[Kenomac]

Originally Posted by capngeo

I think they rented from me too!

As others said, pick your tenants wisely! I ALWAYS make sure I pick the tenants personally regardless of where I have to come from to do it. My favorite trick is to have a very ambiguous question on the application… and no space for them to list their phone number. BUT always insist on “current address”.

This gives me the excuse to show up unannounced at their current place… If there are cars on blocks, holes in the walls and animal leavings on the floor, their app gets shredded; if immaculate then they get a lease!

Sounds like a good idea.

An additional problem we have here in Massachusetts and also in many states like California, is that it's illegal to discriminate on the basis of almost anything... Especially if prospective tenants have kids. So even if you find out after the lease has been made, there's not much you can do about it. We had one ahole (a real pro deadbeat who had all the right references and answers) move into one of our offices, which wasn't zoned as an apartment. Instead of moving her nursing business into the space, she moved in with two pitbulls, a heroin addicted boyfriend and a mattress. Never paid any rent for six months and the state and police treated those damn pitbulls who were crapping all over the inside of the office, like they were children. The country is bass-ackwards and upside down regarding property rights. Then the complaints started about the place being substandard for living quarters when she took me to housing court... IT WAS A COMMERCIAL OFFICE!!

My wife picked up the local paper and read the police log last week. Turns out the police had arrested a heroin dealer along with an accomplice who gave our home address... An upstairs office! No matter how careful we are... It keeps happening. One of my office tenants was trying to be a nice guy, and let the guy sleep on his couch. This time, the eviction shouldn't be a problem.

[phairest]

Originally Posted by Kenomac

Then the complaints started about the place being substandard for living quarters when she took me to housing court... IT WAS A COMMERCIAL OFFICE!!

PLEASE tell me you won that...?

Also FYI, my "poor assumptions" regarding the rights/duties of a lodger/boarder/guest vs tenant in my state of TX are drawn from statutes, reputable sources, and legal precedent. Specifically...

"Tenant" means a person who is authorized by a lease to occupy a dwelling to the exclusion of others and, for the purposes of Subchapters D, E, and F, who is obligated under the lease to pay rent.
PROPERTY CODE CHAPTER 92. RESIDENTIAL TENANCIES

Additionally, in the article "Forcible Detainer Lawsuits: Issues and Traps for the Unwary," UT Law professor Fred Fuchs agrees that there is a legal distinction between a guest/lodger vs a tenant, and that an owner dealing with the former can forcibly remove them without court involvement. Based on precedents, he asserts the main defining aspects of tenancy are A) the intent of the parties, and B) exclusive vs shared use.
Article (relevant info on pp 7 - 8): http://www.tjcja.org/resources/Evict...04.01.2012.pdf
Author: UT Law - Faculty - Fred J. Fuchs

So yay for lodger-agreements! Maybe... tbc

[BandB]

Originally Posted by phairest

PLEASE tell me you won that...?

Also FYI, my "poor assumptions" regarding the rights/duties of a lodger/boarder/guest vs tenant in my state of TX are drawn from statutes, reputable sources, and legal precedent. Specifically...

"Tenant" means a person who is authorized by a lease to occupy a dwelling to the exclusion of others and, for the purposes of Subchapters D, E, and F, who is obligated under the lease to pay rent.
PROPERTY CODE CHAPTER 92. RESIDENTIAL TENANCIES

Additionally, in the article "Forcible Detainer Lawsuits: Issues and Traps for the Unwary," UT Law professor Fred Fuchs agrees that there is a legal distinction between a guest/lodger vs a tenant, and that an owner dealing with the former can forcibly remove them without court involvement. Based on precedents, he asserts the main defining aspects of tenancy are A) the intent of the parties, and B) exclusive vs shared use.
Article (relevant info on pp 7 - 8): http://www.tjcja.org/resources/Evict...04.01.2012.pdf
Author: UT Law - Faculty - Fred J. Fuchs

So yay for lodger-agreements! Maybe... tbc

I didn't know you were in Texas. I can tell you in some states that would definitely not be the case. Even in Texas I'd consult with an attorney. But in other states there have been many situations where getting rid of roommates or ex girlfriends or various others has been a nightmare.

[tbodine88]

Yeah, I am a landlord in both Texas and California.

In California, it takes six months to evict. Here in Texas, it was two weeks, and that was because, they didn't pay December's rent, so the Judge was unavailable until January 4.

Place was trashed, so it still cost $10K, to get new tennants.

[BandB]

Originally Posted by tbodine88

Yeah, I am a landlord in both Texas and California.

In California, it takes six months to evict. Here in Texas, it was two weeks, and that was because, they didn't pay December's rent, so the Judge was unavailable until January 4.

Place was trashed, so it still cost $10K, to get new tennants.

When we moved to Florida someone tried to talk me into buying rental property and we considered it but it sure has headaches attached. We decided not to do it. Have friends though who have done it for a long time and had few issues. The key really is tenant selection and screening and today that information is all available. Those who trashed yours I'm sure have done it before or will do it again.

[markmccain]

Originally Posted by Kenomac

Sounds like a good idea.

An additional problem we have here in Massachusetts and also in many states like California, is that it's illegal to discriminate on the basis of almost anything... Especially if prospective tenants have kids. So even if you find out after the lease has been made, there's not much you can do about it. We had one ahole (a real pro deadbeat who had all the right references and answers) move into one of our offices, which wasn't zoned as an apartment. Instead of moving her nursing business into the space, she moved in with two pitbulls, a heroin addicted boyfriend and a mattress. Never paid any rent for six months and the state and police treated those damn pitbulls who were crapping all over the inside of the office, like they were children. The country is bass-ackwards and upside down regarding property rights. Then the complaints started about the place being substandard for living quarters when she took me to housing court... IT WAS A COMMERCIAL OFFICE!!

It sounds like maybe her pets where therapy dogs and you needed to make a reasonable accommodation? Pit bulls are usually on the breed restriction list issues by most property insurance companies. Some times you can use this as leverage to get the tenant out depending on the judge and how your lease is written.

I am very surprised that it took you six months to get this resident out. In MA it usually takes no longer then 20-25 days depending on how the court dates line up that month and how your lease is drafted. Why did it take so long?

Owning rental property can be a very profitable investment but unfortunately a lot of people go into it without very much knowledge of tenant/contract law and they really get screwed.

If you know what your doing and your properties are stable its easy to manage rental properties from anywhere there is a phone or internet.

[skipmac]

Originally Posted by markmccain

I am very surprised that it took you six months to get this resident out. In MA it usually takes no longer then 20-25 days depending on how the court dates line up that month and how your lease is drafted. Why did it take so long?

Read some of the previous posts. It's the law in a lot of states. I have several relatives in real estate who have had this problem. Even if a tenant never pays you a dime it could take 3 to 6 months to have them evicted. The time depends on the laws in that state.

Originally Posted by markmccain

If you know what your doing and your properties are stable its easy to manage rental properties from anywhere there is a phone or internet.

I would never consider that unless I had someone local to check up on the properties. Too easy for a tenant to trash your house while sending you happy emails.

[markmccain]

Originally Posted by skipmac

Read some of the previous posts. It's the law in a lot of states. I have several relatives in real estate who have had this problem. Even if a tenant never pays you a dime it could take 3 to 6 months to have them evicted. The time depends on the laws in that state.

I would never consider that unless I had someone local to check up on the properties. Too easy for a tenant to trash your house while sending you happy emails.

I am only intimately familiar with MA and ME tenant law. It sounded like this issue happened in MA and that's why I am surprised it took so long. I am only referring to those two states when I say that it is usually possible to evict a resident in less then a month for nonpayment.

I completely agree with you that to own property remotely you need to have a property manager you trust. If you can find this relationship its more then possible.

[hellosailor]

One might note, that if someone does not know about evictions and the eviction process in their state, county, and municipality? They probably haven't done enough homework to be a landlord. Yet.

It is a rare landlord who would do a cross-check on pet registrations or rabies shots to find out if a tenant really did have a dog, but there are all sorts of background checks that are commonly done, and where it is legal, the prospective tenant may need to pay for the check as well.

[markmccain]

Originally Posted by hellosailor

One might note, that if someone does not know about evictions and the eviction process in their state, county, and municipality? They probably haven't done enough homework to be a landlord. Yet.

Or they probably want to use a attorney that specializes in that type of law if they ever have any issues.

Rocketman said on the first page:

Originally Posted by Rocketman

One unit or a couple of units, sould not be very difficult from afar, the secret that most new land lords will learn with time is to pick your renters very carefully. If your renter can not pay a security deposit, and first month rent up front, do not rent it under any cercomstance. Even if your renting it to your monther.

This is definitely the first rule for any new landlords or landlords that are thinking about leaving the management of their properties in someone else hands. Some great background check companies that I have used with success in the past are:

Realpage
Saferent
Tenant Net

These are companies that are accessible from anywhere and realpage and Saferent also process credit checks and check writing history reports, along with a bunch of other type of reports if you want them.

Originally Posted by hellosailor

It is a rare landlord who would do a cross-check on pet registrations or rabies shots to find out if a tenant really did have a dog, but there are all sorts of background checks that are commonly done, and where it is legal, the prospective tenant may need to pay for the check as well.

That's true, I don't know many landlords that goes through that extra work. Instead I have a clause in my lease that says:

"Pets: No pets are permitted in or around the premises without prior express approval of Landlord. Pets will be considered approved by landlord when a pet addendum is signed by both the landlord and the tenant. Any executed addendums will be made part of this lease with all terms and conditions ratified and confirmed. Tenant's non-compliance with this provision or reasonable rules of the Landlord shall be cause for termination of this Lease Agreement upon five (5) days notice to Tenant. Any pet found to reside in or around the premises without prior express approval of Landlord, will be reason for a $100.00 fine, per occurrence.

Pets that are allowed by the Landlord at the time of the signing of the lease are: None

Any damage caused to the dwelling unit, common areas or grounds of the property by the Tenant's pet(s) will be considered a violation of the lease and the lease shall be deemed to be breached, the term hereof forfeited, and the Tenant, without further demand or notice, shall be subject to eviction, as well as suit for damages."

The clincher is the $100 fine per occurrence that give the landlord a lot of leverage to make sure no unapproved pets resided there. Of course, this might not adhere to state laws if you don't live in MA or ME.

[Kenomac]

Originally Posted by markmccain

It sounds like maybe her pets where therapy dogs and you needed to make a reasonable accommodation? Pit bulls are usually on the breed restriction list issues by most property insurance companies. Some times you can use this as leverage to get the tenant out depending on the judge and how your lease is written.

I am very surprised that it took you six months to get this resident out. In MA it usually takes no longer then 20-25 days depending on how the court dates line up that month and how your lease is drafted. Why did it take so long?

Owning rental property can be a very profitable investment but unfortunately a lot of people go into it without very much knowledge of tenant/contract law and they really get screwed.

If you know what your doing and your properties are stable its easy to manage rental properties from anywhere there is a phone or internet.

You don't have any idea of what you are talking about. Therapy dogs?? The drug addict squatters were living in my commercial office building which isn't zoned as an apartment. You need to work on you reading comprehension.

But your probably right.... I should get someone more experienced to run the place... I've only been doing it for 18 years.

This summers problem is an office tenant who likes to smoke pot. All the other tenants are demanding I do something about the way he smells like pot. But thanks to the nutty dumbass voters in Massachusetts who voted two years ago to legalize pot for medical use... there's not much I can do about it without violating his new right to smell like weed.