5 Avoidable Mistakes Landlords Make with Rental Agreements

Landlord Mistakes to Avoid in Your Rental Property Lease Agreement

Though having one universal lease agreement satisfying every type of lease term possible would be great, in reality, every lease is different.

And, while using a universal lease form is possible, it is important to note that whether you self-manage your Dundalk rental property, or enlist the help of a property management company, there are going to be specifics that you need to address while drafting your property’s lease agreement.

As a landlord, there are many things to think about while filling a vacant rental.

To name a few, you must consider: advertising the property as available, performing the tenant screening process, conducting move-in inspections, and of course drafting the lease agreement.

Unfortunately, with all of the things you need to tend to, and the desire to rush the process of filling a vacant rental property, some landlords make dire mistakes in their rental agreements that can wreak havoc on their rental property business.

Don’t let these common mistakes plague your rental agreement while trying to quickly place someone in your vacant property.

Instead, learn from these mistakes (that others before you have made), and find out what makes a lease agreement one that protects you, your investment property, and your tenants.

 

Avoid These Mistakes While Drafting Your Lease Agreements

1. Not Properly Identifying the Tenants

Although this may seem obvious, you would be surprised how many landlords fail to address their tenants correctly in their lease agreements.

Remember, a rental agreement is a legal document, and should refer to your tenants by their full legal names.

No nicknames, shortened names, or names other than what are listed on driver’s licenses or identification cards should be allowed in the lease agreement.

In addition, you should have your tenants names located somewhere in the beginning of the document (typically in the first paragraph), as well as at the end of the document where the signature blocks are placed.

If you fail to name your tenants correctly on the lease agreement, you may find it difficult to enforce your lease agreement.

This is especially true if you land in court due to a landlord-tenant dispute.

If your tenants make claims that the people listed are not really them, you are going to have a hard time winning your case.

 

2. Not Researching Rent Rates

Research Rent Rates for Your Dundalk Rental Property

One of the key elements in a lease agreement is the monthly rent rate that your tenants are responsible for paying each month.

Failing to research the market rent rates properly and instead placing a random rent rate in your lease agreement will is something you want to avoid.

This mistake may cause you to over- or underprice your rental property.

If you overprice your rental, your tenant pool will shrink sizably, and any tenants that you have currently residing in your property are not likely to renew if you continue to raise the rate sporadically.

On the other hand, underpricing your rental property will harm your bottom line.

A great way to ensure you name the right rent rate in your lease agreement is to talk to your Dundalk property manager.

They will have insight into things such as current market trends, demographics of the area your property is located in, and the rates that similar properties are going for so you remain competitive.

Lastly, in order to avoid another mistake some landlords make, you should re-evaluate your rent rates every time you place a new tenant in your property to make sure to keep in line with current trends.

 

3. Not Personalizing the Agreement

Universal lease agreement forms don’t come with every lease provision you can think of. That’s why simply filling in the blanks is a bad idea, and is one that your Dundalk property management company will discourage.

Now is the time for you to be specific about the rules as they pertain to your rental property.

Take a look at some of the specific clauses you might want to include in your rental agreement:

  • Whether your tenants can smoke in the property
  • What type of interior alterations (temporary or permanent) tenants can make
  • If your tenants can have pets, and if so, which type, how many, what size, and what the deposits will be
  • Which maintenance responsibilities your tenants will be responsible for

 

All of this lease agreement personalization will ensure your tenants know exactly what is (and isn’t) expected of them while residing in your property. It will also outline the consequences for not following your rules.

However, as important as personalizing your lease agreement is, make sure you follow your state’s rental property laws.

For example, make sure you don’t overcharge on the security deposits and fees.

In addition, don’t ask your tenants to violate their tenant rights, such as forfeiting the notice of entry, so that you can do as you please.

Avoid these mistakes at all costs, as they will land you in some serious legal trouble.

 

4. Not Addressing Late Rent

Address Late Rent in Your Dundalk Rental Property

Earlier we mentioned the importance of setting an appropriate rent rate and placing it in your lease agreement.

That said, it is equally important to mention what will happen should the rent not get paid on time.

Failing to detail the consequences for late or non-payment of rent is a huge mistake.

This not only sets you up for continuous late payments, it makes it very difficult for you to receive compensation in court for non-payment of rent, should your tenant stop paying altogether.

Make sure to include the rent rate, grace period, late fees, and eviction process for non-payment of rent in your lease agreement, so that should you run into an issue with a tenant, you have the legal document backing you up that states both parties agreed to the terms and your tenant owes you money.

Late payment lease provisions are used to inform and motivate your tenants to pay their rent on time.

After all, you rely on their timely payment and often cannot afford to wait for them to pay when it is convenient for them.

In addition, this section not only protects you in the case of non-payment, it protects your tenants from illegal eviction proceedings.

 

5. Not Setting a Lease Term

In your rental agreement, it is crucial you designate a lease start and end date.

This way your tenant knows exactly when they can move in, and when they have to be out of your property, should they choose not to renew their lease with you.

In addition, there are some lease renewal options that some see as mistakes, that you and your Dundalk property manager should carefully consider while drafting a lease agreement:

  • Allowing for automatic lease renewals (how can you be sure you will want your tenants to renew one year from now?)
  • Including a month-to-month renewal option (both parties have the option to break a month-to-month lease with 30 days’ notice, leaving you little time to find new tenants)
  • Not requiring a 60 days’ notice of intent when it comes to renewals (leaving it to the last minute might leave you with no time to fill a vacancy, should your tenants decline your offer)

 

The Importance of an Airtight Lease Agreement in Dundalk

Altogether, none of these options are necessarily dire mistakes. However, they may cause you extra stress that can be avoided with a well thought out and thorough lease agreement.

Having an airtight lease agreement that addresses all of your concerns is important for everyone involved.

After all, the lease agreement is the document that both you and your tenants will refer to when there is an issue.

Therefore, the more thorough it is, the less confusion you and your tenants are bound to encounter.

If you own rental property in the Dundalk region, and want help drafting a comprehensive and legally compliant lease agreement, contact Bay Management Group today.

With years of experience drafting lease agreements for property owners, and extensive knowledge of the landlord-tenant laws, you can rest assured that every provision you want included will be integrated into each rental agreement so they you, your investment property, and your tenants are fully protected.


How to Interview Potential Tenants For Your Edgewood Rental

How to Interview Potential Tenants for Your Harford County Rental Property

We all know how important it is to interview tenant references when deciding whether to lease to a prospective tenant.

In the past, we have discussed how to do just that, as well as provided some tips for how to double check, and ensure a potential tenant’s references are even real.

But have you put much thought into interviewing the actual tenant?

With so much stress being placed on verifying a tenant’s references, property owners often forget to interview the actual tenant that will be living in their Edgewood rental property.

That’s why today we are going to look at some great ways to approach interviewing potential tenants, as well as some of the best questions to ask.

 

How to Interview Potential Edgewood Tenants

 

1. Follow a Consistent Tenant Screening Process

We always emphasize how important having a consistent tenant screening process is.

And, if you don’t currently enlist the help of property management services in Edgewood, the idea of having a strict tenant screening process in place may be foreign.

However, it is crucial you don’t wing the screening process.

You might unknowingly violate housing discrimination laws, and find yourself in a lot of trouble.

Or, you might place a terrible tenant in your rental.

Tenant interviewing is entwined in the screening process.

In fact, at every stage of the tenant screening process, there are perfect opportunities to conduct mini interview sessions along the way.

Look at Rentalutions’ five stages to a good screening process, to see what we mean:

  1. The Inquiry. An interested tenant calls you wanting to know more about your Harford County rental property. This is when you can run some quick screening questions by them to make sure they are serious about leasing your property.
  2. Property Showing. This is the first time you meet the tenant in person, and first impressions are a big deal. Your gut instinct will lead you in the right direction after meeting the tenant face-to-face.
  3. Rental Application. As your tenant prepares to fill out the required rental application, you can gauge their reaction as you explain what is required. For example, a security deposit, first and last month’s rent, employment and previous rental history verification, and even a background check are typical things to require during this stage. Tenants that are hesitant to provide the documentation and money upfront, aim to rush the process, or have a lot of “good excuses” as to why they can’t do one thing or another, may signal they are not a good fit for you.
  4. After deciding that the tenant is in fact a good fit, you can sit down and discuss their approval. Again, their willingness, or lack thereof, when it comes to actually handing over the funds to lease your property will reveal itself during this stage.
  5. Lease Signing. By now, the tenant should fully understand what is expected of them while leasing your property. However, if when you are going over the lease agreement in full (as any successful property owner will), the tenant starts to fuss over provisions in the lease agreement that you are not willing to budge on, you ought to back out and find a different tenant.

 

As you can see, every point during the screening process offers a prime chance to interview tenants to ensure they are a good fit.

 

2. Prepare for the Interview

Prepare For Your Tenant Interview in Harford County

Before diving into the interview, it is important to have a game plan.

Again, violating the Fair Housing Act is something you want to avoid at all costs.

You also want to appear professional, prepared, and serious about your rental property business.

It is a good idea to have a specific set of questions you want to ask while interviewing a tenant.

And, if you prefer to split the interview into parts, make sure you have specific questions for each stage of the tenant screening process.

If you are self-managing your Edgewood property, and are unsure about conducting actual tenant interviews, try practicing with a close friend.

This can help ease some of the nerves and help you stay on track during the real deal.

 

3. Be Strong

This is something almost all property managers will recommend.

Tenants are good at trying to convince property owners to lease to them. They know all the tricks in the book, can be smooth talkers, and may even straight out lie to get you to say “yes.”

Being aware of some of the most common red flags that appear during tenant screening will help you avoid falling victim to a problem tenant.

Also, try to remain consistent with all tenants that cross your path, and don’t rush a decision.

After all, placing a less than ideal tenant in your rental property is only going to lead to more problems down the road.

And, these problems are bound to turn into yet another vacancy that you will have to fill with a different tenant.

 

5 Common Questions to Ask Potential Harford County Tenants

Common Potential Questions to Ask Tenants During an Interview

Here are some of the most common tenant interview questions you should ask potential tenants:

 

1. Why Are You Moving?

We suggest learning the most common reasons why people move, and then catering to them so they stay in your rental for long periods of time.

However, sometimes a tenant’s reason for moving so much in the past, or so quickly in the moment, may raise some concerns with you.

Be aware of this and make your decision whether to move forward based on the tenant’s answer.

 

2. Do You Have Pets?

Depending on your rental property’s pet policy, this question is an important one.

It is crucial to get an honest answer from your prospective tenants in the beginning, in hopes that they will not sneak a pet into a no-pet rental, or violate the pet policies that are in place.

 

3. How Many People Will Be Residing With You?

This is important because you should thoroughly screen all adult tenants that will be living in your rental property for the duration of the lease term.

Knowing how many people will be living in your rental from the start will ensure there is enough room for everyone, without exceeding the legal limits.

Just make sure you do not violate any of fair housing regulations, and do not discriminate against potential tenants.

 

4. Can You Pay the Move-in Costs Upfront?

Can Your Tenant Pay Move in Costs Up Front For Your Harford Rental Property?

This is a big one.

Informing a prospective tenant what you require in terms of first and/or last month’s rent, application fees, and security deposits is a good way to weed those out who simply don’t have enough income to cover the move-in costs.

Those who have issues coming up with your requirements at the start of a lease term are bound to give you trouble at one point or another during the lease term when it comes to paying rent.

And this is not something you want to deal with. Ever.

 

5. Can You Pass a Background Check?

Many potential tenants may not be aware that you require a passing background check to lease your Maryland rental property.

Kindly explain to the tenant that you are more than willing to show the property, and discuss the lease terms, but that one of the conditions upon move-in is passing a background check.

Again, this question will effectively weed out anyone that fears they will not pass.

No tenant wants to pay the non-refundable application fee if they know chances of their application being approved are very slim.

 

The key to tenant screening and interviewing is consistency – consistency in the process, consistency in the questions, and consistency in your standards.

Do not let the fear of your property sitting vacant cause you to make a rushed decision.

 

For those that own rental property in Edgewood, and do not want to worry about violating fair housing rules, interviewing tenants on the phone or in person, or having to make the decision to approve or deny a potential tenant, contact Bay Management Group now to help.

At Bay Management Group, we have strict tenant screening processes in place that are not only legally compliant, but also effective.

In fact, on average, we lease most rental properties in 30 days or less.

And, the tenants placed in the properties we lease are high quality, meet all of your standards, and are guaranteed to pay rent on time for at least the first year of the lease term, or else we re-rent your property for free.

So get in touch with us today, and see how we can reduce your vacancy and tenant turnover rates, and get you the annual income you’re aiming for.


7 Ways to Ensure Your Potential Tenant’s References are Real

How to Ensure Your Tenant's References Are Real

Any responsible Baltimore City property owner knows the importance of tenant screening when it comes to placing tenants in their property.

You want to make sure the tenant you are considering has no criminal background, has verifiable income that can cover the monthly rent expenses, and has a good credit score.

Since most rental applications require prospective tenants to list personal and professional references, along with contact information regarding their employers and past landlords, it is equally important that you do not skip verifying these references during the screening process.

Though it shouldn’t come as any surprise, plenty of potential tenants fabricate their references in an attempt to secure a rental home.

And, while this may seem somewhat harmless, the truth is, tenant references have the potential to reveal some very helpful information about your tenant that the paperwork may not.

But how do you know if the references listed on an application are in fact real?

To help answer this question, we will look at some of the best ways you can ensure that your prospective tenant’s references are legitimate.

 

Verifying Your Baltimore City Tenant References

1. Interview the Tenant First

Interview Your Tenant First For Your Baltimore City Rental Property

One thing you might not think about when looking to verify a potential tenant’s references is to talk with the tenant first.

This initial conversation can be brief and should include questions such as:

  • Where are you currently employed?
  • What is your monthly gross income?
  • What might your boss or former employers say about you as an employee?
  • What are your monthly debt obligations?
  • What do you think your previous landlords would have to say about you?

Interviewing a tenant before calling their references will give you a heads up on anything that may seem amiss about the tenant.

It also lays a good foundation for comparison between what the tenant says, and what the references say.

You never know what a tenant’s reference is going to say. Having an idea beforehand what may be said will alert you to any discrepancies right away.

 

2. Explain the Consequences of Falsifying a Reference

Some prospective tenants are going to lie about their references, no matter what.

Unfortunately, that’s just part of being in the rental property business.

However, explaining that any falsifications discovered on a tenant application, references included, will lead to an automatic rejection of the application, may cause some tenants to think twice before lying.

Being clear upfront about the consequences of a dishonest tenant application may help to discourage tenants from putting any fake information on the application.

It also gives the tenant a look at how serious you are about leasing your property. It gives the impression that you stand firm, act as a professional, and will not tolerate problems of any kind.

 

3. Ask for Pay Stubs

Ask Your Tenant For Pay Stubs With Their Rental Application

Sometimes tenants do not have a good relationship with their employers and have someone else, such as a friend, act as their boss on the other end of the phone when a property owner calls in to verify an employer reference.

One great way to get around this, and better verify the tenant’s income in the process, is to ask for a few pay stubs, and possibly even employment verification documents.

With this information on hand, you can conduct your own research, and see if the reference listed is in fact a real person.

In addition, you can reach out to the employer’s HR department and ask to be put in direct contact with the tenant’s employer, rather than call the number listed on the reference sheet.

This will help diffuse any “fake boss” calls.

 

4. Always Call References

Always Call Your Tenant's References in Baltimore City

It is very easy to forge a written reference, either on paper or via email. In addition, you may not get a real feel for how a reference feels about a tenant when reading a prepared statement.

It is best to call all of your prospective tenant’s references and talk with them one-on-one.

This question-and-answer type of conversation may yield some red flags, or further confirm a potential tenant as a good fit for you.

In addition, speaking in person with someone will help solidify that your tenant’s references are real.

 

5. Be Specific in Your Questioning

However, just because you call a tenant’s references and speak to someone directly, does not mean they are a real reference.

Thus, when it comes to interviewing a tenant’s previous landlords, there are specific things you can start off with during the conversation to help verify you are speaking to a landlord, as opposed to a buddy pretending to be one.

RentSpree recommends prefacing the conversation with a statement that you are simply going to ask some generic questions first, to verify that they are an actual landlord.

RentSpree then goes on to say you should ask things like what type of license is needed to become a landlord in that particular region, and what type of inspections are required to lease property.

A real landlord will be able to answer these questions easily.

 

6. Ask for More References

There is nothing stopping you from asking a tenant’s reference for a secondary reference.

In fact, this tactic is very useful when verifying employer references. The more people you talk to about the potential tenant, the better insight you will gain into what type of person, and tenant, they are likely to be.

Start by thanking the reference for their time, and then kindly ask for the contact information of another person that works closely with the tenant.

If you are immediately given information, you can almost guarantee your tenant’s employer references are real.

 

7. Hire a Property Management Company

Hire Property Management Company For Your Baltimore City Rental

An experienced property manager will have had run-ins with tenant references of all kinds.

They are best suited to tell when someone is being dishonest, and when the true character of a potential tenant is being revealed.

There is no doubt that a skilled property management company will be able to handle tenant screening better than anyone else will, yourself included. Their job is to place high quality tenants in your rental property, so that you continue to employ them for their services.

Not taking tenant screening, specifically reference checks, seriously would do their business more harm than good.

That’s why relying on a quality property management team to screen your tenants for you is often your best bet for ensuring a tenant has given you real references.

 

In the end, verifying that your Baltimore City tenants have real references on their rental application can be tough.

It will often take some extra research on your end, and a little bit of gut instinct to decide whether a reference is telling the truth. Luckily, however, there are good ways of getting around some issues that tend to pop up with fake tenant references.

If you are in the Baltimore City area and own rental property that needs a tenant, contact Bay Management Group today and see how we can help you with your tenant screening and placement needs.

Not only do we have a thorough tenant screening process in place that includes contacting all potential tenant references, we also have a 12-month tenant warranty in place that promises to re-lease your property for free, should your tenant be evicted within the first year of leasing your property.

So, contact us today and take advantage of this great warranty, among many other things.


Should You Approve Tenants Without Meeting Them?

Philadelphia Property Managers Approving Qualified Tenants

Would you ever consider leasing your Philadelphia rental property to a tenant you have never met?

Most property owners would immediately say “no.” After all, meeting a prospective tenant in person leaves a valuable impression on you, and ultimately helps in determining whether they are a good fit for your property.

But is there really a reason to meet a tenant in person prior to approving them to lease your property?

 Several experienced landlords say “no.” In fact, many landlords have screened and approved tenants they have never met in person. Some landlords meet their tenants for the first time when handing over the keys to their property.

In addition, those that employ high quality Philadelphia property managers to place tenants in their rentals are in no way obligated to meet their property’s tenants, thanks in large part to the thorough job their property manager does during the screening process.

If you are wondering whether approving tenants for your rental property without meeting them is a good idea, keep reading.

Today we are going to share how you can find great tenants for your rentals without ever having a face-to-face meeting.

 

How to Approve Tenants for Your Philadelphia Rental Property Without Meeting Them

 

1. Have a Strict Screening Process in Place

Screening Process for Philadelphia Property Managers

If you are using Philadelphia’s leading property management company to help you keep track of all things property related, this will never be an issue.

However, for those that are self-managing their properties, enforcing a strict screening process is crucial.

Take a look at some things you can do while screening potential tenants that you haven’t met.

Verifications

Verifying a prospective tenant’s income, credit score, and rental history can be done using a mix of phone calls, emails, and faxes. If your potential tenant can prove they meet your criteria, there is nothing wrong with continuing the approval process, despite not having met them in person.

Here are some tips to help you with the initial verification of potential tenants:

  • Understand the average household income in your area so that you can price your rental accordingly, and assign proper income requirements to potential tenants
  • Set a minimum credit score you would like to see in any tenant that is placed in your rental
  • Conduct background checks on every prospective tenant to gauge what type of person they are, and how they might act as your tenant
  • Always avoid discriminating against protected classes, regardless of whether you meet a tenant in person or not

In the end, either your potential tenant will pass the criteria you set or not. Their income, credit score, and criminal background will remain the same regardless of whether you meet in person.

Application

Philadelphia Property Manager's Lease Agreement

Receiving a completed application from an interested tenant does not have to be done in person – email or fax works just fine.

Via an online application portal is even better.

If you use an online application system, you can receive not only the completed application with all of the tenant’s information, but the application fee as well via the portal.

With this system, there really is no need for you to meet a tenant in person to take an application and their payment. This is especially true if you have a property manager that can handle these steps for you.

Referrals

Tenant referrals are an important part of the tenant screening process. And, referral information is easily found on a tenant’s written application.

This means you do not have to meet with the tenant to contact referrals. Using the above-mentioned methods – email, fax, or an online application system – will do.

Again, if your property manager requires an in-person application drop-off, great. This does not mean however, that you need to be present at this drop-off, and also doesn’t mean that you need to meet a potential tenant in person prior to approval.

The key here is to gather information about your potential tenant from their referrals, and other information that will not change by meeting them face-to-face.

 

2. Learn the Red Flags

Tenant Red Flags for Philadelphia Property Managers

Some red flags may alarm you about a potential tenant, and can pop up without ever having met the tenant.

In fact, many of these red flags will appear during the tenant screening process, a process that does not need to be done in person to be effective.

Here are some things to be on the lookout for while attempting to place a tenant in your Philadelphia rental:

  • Tenants that you speak to on the phone that are negative about their past living situations are probably not the type you want to place in your rental. Sure, some complaints are justifiable. After all, not all landlords are perfect. However, those that have excessive negative comments about their past landlords, or the properties they lived in, are likely to be those that will never be satisfied with your property either. Without ever having met this tenant, you will know right away that they are not a good fit for your rental.
  • Unstable employment. Changing careers from time to time is normal for most people. However, interested tenants that have a long resume of past jobs listed on their application are not ones to mess with. Those that change jobs frequently run the risk of losing their jobs while residing in your property. This means you may not receive your rent on time, or at all, at some point during the lease term. Again, meeting a tenant in person will not change the fact that they cannot hold down a steady job. If an interested tenant has a long list of prior jobs, approving them to lease your property is probably a no-go.
  • Prior evictions. This is a big one, and not something you need to meet a tenant in person to find out. If your prospective tenant has had an eviction within the last 5-7 years, no amount of in-person friendliness can change the fact that they are a risk to you and your property.

 

In the end, there really is no reason you have to meet a prospective tenant in person prior to approving them to lease your rental.

All of the important information that is needed for approval is easily gathered through other means, and reveals immediately whether a tenant will be a good fit for your property.

If you own rental property in the Philadelphia area and are looking for an experienced, knowledgeable, and friendly property management team to help manage your property, look no further than Bay Management Group.

We focus solely on property management, offer competitive monthly management fees, and implement a strict tenant screening process that will not require you to meet a tenant prior to approval (if at all).

Start enjoying your life and lessen the stress of owning rental property by contacting Bay Management Group today.


How to Handle Long-Term Guests in Your Rental Property

handle-long-term-guest-pikesville-rental-property

There is a thin line separating who should be considered a guest in your Pikesville rental property and who constitutes an actual residing tenant.  And, if you are not careful, guests that overstay their welcome in your rental property can quickly turn into serious liabilities if they become more tenant-like than guest-like.

In order to protect you and your Pikesville investment property, and remain a successful landlord, it is important you take proactive steps when it comes to handling long-term guests in your rental.

If you are not sure what these steps are, however, that’s ok.

Today, we will explain exactly how to handle a long-term guest in your rental property, so that you do not fall victim to an overstaying guest who should really be treated as a tenant.

 

What Constitutes a Long-Term Guest?

elderly-parent-moves-into-rental-property-long-term-guest-pikesville

How do you know if someone is in long-term guest territory? 

The easy answer is this: anyone who has signed a legally-binding lease contract with you is considered a tenant.  Anyone who has not signed a lease agreement with you is considered a guest while in the property.

However, what about those instances in which your tenant allows a guest to stay in your rental property for long periods of time?

Some example situations include:

  • Your tenant’s college student son/daughter comes home for the summer or drops out and “moves home”
  • An elderly grandmother moves back in with her child (your tenant), because she can no longer care for herself
  • A boyfriend or girlfriend sleeps over most days/nights of the week
  • Hired help, such as a nanny, lives on the property

This is where the line defining a “tenant” and a “long-term guest” begins to get hazy.

While guests are certainly allowed to visit your tenant for days at a time, how do you prevent a long-term guest from becoming a tenant that is unaccountable on the lease agreement?

To start, you can begin recognizing the signs that your Pikesville tenant’s guest may be turning into a tenant that is not on the lease agreement:

  • The guest begins to pay rent
  • Mail is delivered to the property in the guest’s name
  • More nights than not, the guest sleeps over
  • Pets, furniture, or other large personal belongings of the guest have been moved into the property

Next, you can take one of the biggest pieces of advice any property management company or successful landlord can give you when it comes to handling long-term guests.

Consider any guest at your rental property a tenant if they take up residence without permission from either you or your property management company, no matter what.

Typically, though every state differs, a guest that resides in your rental property for a period of 7, 14, or 30 (or more) days is labeled a long-term guest.  With these guidelines in mind, it is important you outline in your lease provisions what you consider a long-term guest, and after what period of time it is mandated your tenant inform you that a long-term guest will be staying longer than the allowed time.

Some additional examples of long-term guests include:

  • A friend who has recently lost his job and needs a place to crash
  • A family member on an extended vacation
  • Retired parents that stay for months at a time while visiting
  • A subletter your tenant signed a contract with, without your knowledge
  • Anyone renting a room from your tenant

Since there are several scenarios in which a “visiting” guest can turn into a long-standing tenant in your Pikesville rental property, it is crucial you understand how to handle this before it gets out of hand.

 

4 Ways to Handle Long-Term Guests in Your Pikesville Rental Property

 

1.  Draft an Airtight Lease Agreement

Making sure your Pikesville lease agreement includes a provision addressing the issue of long-term guests in your rental home is the key to preventing any issues from cropping up.  Be clear about how long a guest may stay at your rental property without permission from you.

Next, outline when permission must be received from you in order for a guest to stay longer than the allotted guest time period.

If you are unsure as to how to draft a lease agreement with long-term guest provisions, contact your local property management company, Bay Management Group, to help you.  We are experienced in all things rental property related, and are knowledgeable about all current federal, state, and local laws that may affect the handling of long-term guests in your rental property.

 

2. Prevent Subletting

prevent-subletting-pikesville-rental-property

Subletting your rental property as though it is a bed-and-breakfast can become a dangerous situation for everyone involved.

While your tenant may feel that allowing people to “rent” your rental property from them for a few nights here and there is harmless, the truth is you are at risk for major liability concerns, should anything bad happen.

If you want to avoid this situation all together, again, draft a clear lease agreement forbidding the subletting of your rental, for any purposes.

 

3. Stay Involved

One way to become a successful landlord is to stay involved in what is happening at your rental home.  Whether this means you, or your property management company, conduct regular inspections, periodic drive-bys, or personal visits to drop off something your tenant may need; you need to know what is going on in your property.

If you notice that there is an extra person that seems to be staying at your rental for more than a few days, be diligent about finding out the following:

  • Who the guest is, and what relation they have to your tenant
  • Why the guest is at your property
  • How long the guest plans on staying

From there, make sure to regularly check on your property to ensure no lease violations are occurring.  If, by chance, you realize that this “guest” has overstayed, take action.

Grab a tenant application and have your tenant’s guest fill it out so that they can be legally added to the lease agreement after a thorough tenant screening.  This shifts the liability from you to the newly residing tenant.

 

4. Be the Boss

be-boss-present-written-warnings-tenant-pikesville-rental-property

When your tenants agree to lease your rental, they sign a legally binding contract that holds them to follow certain rules and regulations.  If you find out that your tenant has violated the long-term guest provision, you must put your foot down immediately, and serve the proper consequences:

  • Provide written warnings, should neighboring people make complaints about parking violations, noise, excessive damage, and improper use of community amenities such as the pool, gym, or laundry equipment.
  • Start the eviction process with your property management company, even if your tenant is not at fault.

In order to avoid your own legal troubles, it is your responsibility to make your original tenant responsible for his or her guests at all times.  This is especially true for those guests that are bordering on becoming tenants of your rental property.

It is not unusual to expect that your Pikesville tenants will have guests at your rental.  In fact, it is not unusual to think that oftentimes, these guests may stay a few nights.  However, as a property owner looking to protect an important asset like a rental property, it is best to treat all long-term guests just as you would any other lease violation, if they overstay their welcome as per the lease agreement.

 

If you are in the Pikesville area and need help drafting a lease agreement that includes provisions regarding long-term guests in your rental property, get in touch with Bay Management Group today.  Not only will we help you with your lease agreement, we can help with tenant screening, routine inspections, maintenance requests, and any legal troubles that may arise out of an overstaying long-term guest.


6 Red Flags Not to Miss in Tenant Screening

dont-miss-red-flags-tenant-screening-maryland-property

Thorough tenant screening of all prospective Maryland tenants is critical to the success of your rental property business.  Place the wrong tenant in your property and you could face enormous financial loss, property damage, and even the fall of your rental property business altogether.

When you are screening potential tenants for your investment property, especially if you self-manage your property, it can be hard to figure out which criteria to take into account.  And, while you may be tempted to ignore some obvious red flags so that you can place a tenant into your property more quickly, we are here to tell you not to fall victim to that hurried emotion.

There are several serious red flags that should alarm you during the tenant screening process if they ever crop up.  Even if you employ a property management company to conduct tenant screenings for you, it is crucial you know exactly what they are looking for in the tenants that will ultimately reside in your property.

 

6 Red Flags to Look Out for During the Tenant Screening Process

1. Poor Credit

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A potential tenant’s credit score is one of the most surefire ways to tell whether they are a quality prospect to lease your property or not.  This is because a credit score provides a great overall view of a tenant’s financial stability.  Plus, it provides insight into how they handle payments and the debt that comes with those payments.

In the end, the lower the credit score, the less qualified that particular tenant is of leasing your rental property.  Although location and demographics may play a role in the exact credit score number you look for, anything below 650 is typically considered a red flag.

 

2. Inconsistent Income

Next to credit score, a tenant’s income and employment verifications are major factors when it comes to deciding whether they are a good fit for your property. In fact, it is not unusual for property owners to require tenants to make 2-3 times the monthly rent per month in income.  Though this seems steep, with so many people floundering in debt, this value provides property owners comfort in knowing that their tenant makes enough money to pay their rent each month.

If your prospective tenant cannot verify the amount of income they make each month, take this as a huge red flag.  If your tenant does not have enough income, your monthly rent requirement is sure to come up short at some point.

 

3. Prior Evictions

look-for-prior-evictions-tenant-maryland-rental-property

If your tenant has failed to pay in the past, or has broken a signed lease agreement so severely they were evicted, chances are high they will do the same to you.  You may implement a zero tolerance policy when it comes to prior evictions and leasing your Maryland rental property.  If, however, you want to include a level of flexibility when it comes to past evictions, aim for no prior evictions in the last five years.  After all, sometimes things happen that are out of people’s control and evictions occur.  However, be very selective when it comes to this and make sure your prospective tenant is flawless in every other aspect.

 

4. A Criminal Record

If a tenant you are screening has a criminal history, you might want to reconsider placing them in your property.  Viewed as a major red flag, any prior convictions such as disturbances, DUIs, drug offenses, and driving without a license or insurance may indicate the tenant is unable to follow the law.  In fact, you may even want to include multiple traffic stops and dismissed charges in your assessment of them.

 

5. Bad References

bad-references-red-flag-tenant-rental-property-maryland

If you reach out to a reference that your potential tenant listed on their application, and you receive bad news about them, consider this your lucky day.  Rarely will a listed reference say anything against a potential tenant if they are listed on the application.

However, that is not to say you cannot gather some useful information, even from a good reference.  Make sure to ask the critical questions such as whether the tenant paid on time, if they ever caused any disturbances, and what the condition of the place was when the tenant left.

If your tenant’s reference reveals things that do not sit well with you, count that as a red flag.  Moreover, if your potential tenant resists providing you references, especially previous landlords, take that as a red flag as well.

 

6. Moving Too Often

A tenant that moves a lot may turn out to be a bad tenant.  There are questions to ask when it comes to a frequent mover such as why they move so much and whether the moves were on their terms or their previous landlords’ terms.  This is where having previous landlord references is helpful.  Though not always a reason to turn down a potential tenant, a tenant that moves a lot can signal a red flag and is something to consider carefully.

In addition to moving a lot within a short period of time, a tenant that was previously living with a friend or relative can be a red flag that needs further evaluation as well.  True, many millennials are living with their parents longer than ever.  And, this does not necessarily signify that once they do decide to move out on their own that they will be a poor tenant.

However, many people move in with friends and family after an eviction.  This could end up being a big problem later on should you decide to place this tenant in your rental home.  Make sure you investigate closely and find out exactly why a potential tenant had non-traditional living situations in the past.

Finding the perfect tenant for your Maryland rental property can be hard to do if you are inexperienced at tenant screening.  Thus, hiring a property management company to help you with tenant screening, and everything else property related can be a lifesaver.

 

If you are in the Maryland area and want to place new tenants in your investment property, contact Bay Management Group to help.  Not only do we know all of the red flags to look out for during the screening process, we understand how important it is not to discriminate against potential tenants in the process.  Following the Fair Housing Act during the tenant screening process is essential to avoiding a lawsuit and ensuring the screening process is performed legally.

In addition, Bay Management Group can aid you in the management of your rental property after placing a high-quality tenant.  From rent collection to routine inspections, on-call maintenance support to transparent bookkeeping, Bay Management Group takes all the hassle out of owning and leasing a Maryland rental property.


Landlords Beware: How to Avoid Rental Fraud

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Rental fraud: What is it and how can Maryland landlords avoid it?

For those of you who have yet to experience the horror of rental fraud, we are here to explain to you exactly what it is.

Rental fraud is when someone who is not you or your Maryland rental management company claims to own your rental property and proceeds to lease it out to unknowing tenants.

Scary, isn’t it?

Rental fraud can lead to several difficult situations:

  • Security deposit and first/last month rent is collected by the fraud. Then, come move in time, tenants have no way of accessing the actual property. Meanwhile, the fraudulent landlord is already on the run with money in hand.
  • Your property’s locks are changed and tenants actually move into your rental home having no idea that their “landlord” is a fake.
  • You are forced to remove the innocent, although illegally residing, tenants who have been scammed.
  • You are left with the mess of having to prove in a court of law that the property is actually yours.

Though avoiding rental fraud may not be entirely possible, there are some proven strategies that can help reduce the chances of you ever falling victim to this type of scam.

 

Rental Fraud Comes in Many Formsbeware-maryland-rental-fraud

As mentioned above, rental fraud is when someone poses as either the landlord or property management company to illegally lease out your Maryland rental property. However, there are other types of rental fraud as well.

Landlords are also vulnerable to the types of rental fraud outlined below, and should be aware of their susceptibilities at all times.

 

The Eviction Scam

This type of rental fraud is when a tenant moves into your property with no intention of ever paying rent. As a result, you are forced to evict them.

Unfortunately, the eviction process can sometimes take months to pan out, as well as cost a great deal of money. This leaves the tenant plenty of time to live in your property while lining up another place to scam.

Avoid this scenario: The best way to prevent a tenant who is consistently evicted from every place they occupy is to conduct thorough screenings of each and every tenant you consider placing in your property. This should include a background check, credit check, income verification, and reference follow-up.

Another great tip is to meet each prospective tenant face-to-face, even if your rental management company typically does all the work for you.

Sometimes a first impression will leave you with a gut feeling not to go with a particular tenant, which can be helpful in avoiding scams.

 

The Utility Scammaryland-property-managers-fight-utility-scams

Did you know that many states hold landlords responsible for the water bill despite what the outlined lease agreement states?

Sometimes a tenant will avoid paying the water utility bill because they know that after it goes unpaid for long periods of time, the water company will go after the owner of the property (you) to pay the bill.

To add to this, many tenants are aware that the water company typically does not shut off the water supply to any given residence. This means your tenant is using water on your dime.

Avoid this scenario: The best way to avoid this utility scam is to call your local water company from time to time to make sure your tenant is current on all of their bills.

In addition, it is best to have your property management company draft a detailed lease agreement outlining the responsibilities regarding utility payments. This way, should your tenant neglect their financial obligations, you have a way to prove in court who was responsible for what.

 

The International Scambeware-maryland-international-rental-property-management-scams

This highly popular scam is an unfortunate one that many landlords fall prey to. Also known as the Nigerian 419 scam, this type of fraud involves a prospective tenant from overseas looking to lease your rental property in the near future.

The fraudulent tenant will send you a check for the amount owed at move-in, plus extra “by accident.” This extra money is usually double what you asked for move-in costs.

The fraud will then ask you to wire back the excess money and before you know it, the original check that was sent to you turns out to be fraudulent while the money you have wired back to this person was your real, hard-earned cash.

Avoid this scenario: It is best to not deal with overseas tenants, unless you have a professional helping you with the background checks.

In addition, never accept a certified check from anyone overseas. These checks will usually clear and then bounce weeks later because they are fake.

If by chance you are accepting money from an overseas tenant, only accept money orders through a reputable company, such as Western Union.

 

Monitor Your Vacant Propertiesmonitor-vacant-maryland-rental-properties

In addition to the above-mentioned rental fraud scenarios, there are other ways to avoid getting scammed by sneaky people.

Your Maryland rental property is most vulnerable when it is vacant. The last thing you want is someone breaking into your property and taking up residence with a fake lease agreement.

Should you notice someone squatting in your vacant home, chances are high that the police will have very little authority if the “tenants” have what seems to be a legitimate lease agreement.

The heartbreaking thing is that sometimes these scammers will demand you pay a “ransom” for them to leave your property. This not only costs you money but allows the trespassers a free pass. They never have to take responsibility for their actions and actually make money off of their scam.

And, if you decide against paying the frauds off, this situation will still cost you countless hours and money as you wade through the courts attempting to prove the lease agreement is fake and the “tenants” are indeed trespassers.

Avoid this scenario: Monitor your vacant properties regularly to make sure no one has stepped in and taken up residence.

You may even consider adding an active security system to your Maryland property so that if someone does attempt to break in, the police will have authority to charge him or her appropriately.

 

Watermark Your Photographs

These days, advertising vacant properties online is the norm. And, if you utilize a reputable rental management company, such as Bay Management Group, your rental home is promoted across several platforms to expose your vacant property to the widest pool of prospective tenants.

With any professional rental property ad, images of the home are a necessity. Anyone looking to lease a home wants to have a clear idea what the property looks like before inquiring about it.

The problem is, if someone if posing as you or your rental management company and posting a vacancy online, innocent tenants interested in your property may get scammed or end up living in your home without permission from the true owner (you).

Avoid this scenario: Add a watermark to all images of your property as an extra layer of protection. A watermark makes it more difficult for a fraudulent landlord to steal photos of your property and will likely cause them give up on attempting to scam you.

 

In the end, rental fraud can be a scary situation no matter the type you are involved in. That is why being proactive about your Maryland income properties is absolutely critical to keeping your money out of the hands of scammers and keeping unwanted tenants our of your properties.

If you are looking to safeguard your Maryland rental properties to the fullest extent, contact Bay Management Group.

With knowledgeable staff working solely in property management, Bay Management Group can protect you, your rental property, and your tenants from all types of rental fraud.

Peace of mind is priceless when it comes to your rental property business.

Use Bay Management Group to conduct thorough background checks, draft airtight lease agreements, and inspect your home regularly to make sure everything is in its right place.

 


How to Verify Prospective Tenant Employment and Income

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One of the most important parts of the tenant screening process is to make sure the prospective tenant has verifiable employment and income.

This tenant screening process is important for two reasons:

  1. It helps you ensure that the applicant has the income to pay rent regularly and on time.
  2. It helps you ensure that the applicant has stable employment and income.

Sometimes, a tenant might have plenty of cash on hand to pay rent every month, but they could still be an undesirable type – like someone with a history of being evicted – that you don’t want in your property.

As an Abingdon landlord, you want to select the best possible tenant – every time. Today, we’re going over everything you need to know to properly verify the employment and income of your prospective tenants.

 

How Landlords Can Verify a Prospective Tenant’s Employment and Income

Run a Credit Check

The information you discover on a prospective tenant’s credit report can make or break the deal.

A credit check provides you with insight into your prospective tenant’s financial health, and lets you know if they have been able to fulfill their financial obligations.

And it’s not too hard to uncover your applicant’s credit history. All you have to do is order a credit report through a reporting agency or tenant screening service. By doing so, you’ll learn:

You can also learn the applicant’s total debt to income ratio. For example, if they make $40,000 a year but have $40,000 in debt, they might struggle to pay their monthly rent.

A credit report doesn’t list a person’s current or previous employers, but it does show who else has run a credit check on that person in the past. Because employers often run credit checks on applicants before hiring them, you can see which employers have also checked your prospective tenant’s credit recently.

This will not prove one way or another whether the company actually hired them or not, but that’s why you should always check your prospective tenants’ references.

 

Check Their References

First, you should call your prospective tenant’s employers to verify they’re actually working where they say they are. Sometimes, a dishonest applicant may lie about their employment and write down a fake phone number – so it’s important to be sure.

When you call, be sure you’re calling the main number for the business and ask to speak to human resources or to the manager directly. Ask questions about both their character and how long they’ve been employed at the company.

If you find that a potential tenant has been employed for a considerable length of time, you’ll be able to determine that they have a stable history of employment and a stable income.

Landlords regularly ask employers directly to confirm the income listed on the rental application. If the employer refuses to provide this information for privacy violation reasons, have your tenant sign a release of information form. That way, employers will know it’s okay to release their employee’s info.

Second, you may want to call their previous landlords to find out how the tenants behaved while living in their past homes. It’s wise to insist that all of your applicants disclose the names and addresses of at least two of their previous landlords.

 

Ask former landlords questions like:

  • Did they habitually pay rent on time?
  • Did they follow the rules and non-monetary agreements they made?
  • When did they move out, and why?
  • Did they provide advance notice that they were moving out?
  • Were they evicted?
  • Did they commit any crimes?
  • Did they leave the property in good condition?
  • If they re-applied today, would the landlord accept them?

If the previous landlord tells you something negative about the prospective tenant, it may be a clue that they’re unable to fulfill their obligations to you. They could be economically unstable or totally irresponsible.

Remember, though, that current landlords are not necessarily the most reliable sources of information on current tenants.

If the tenant is a fantastic renter, the landlord may not want them to move and could offer a lukewarm to negative reference in the hopes of keeping the tenant around. If the tenant is the world’s worst renter, the current landlord may offer a glowing reference to get rid of them.

This is what makes it so important to collect multiple references in all categories and follow through on calling them and asking the crucial questions.

 

Use the right process to screen self-employed tenants

Many people are self-employed these days – not just Abingdon landlords.

If your prospective tenant is self-employed, they won’t have a paystub. The best thing you can do is to request copies of their bank statements from the past three or more months to get a good picture of their average monthly income.

Because this can be trickier verify, you can also request to receive a copy of the tenant’s federal tax records. Have your prospective tenant fill out then submit Form 4506 to the IRS. The only problem with this process is that it can take up to 60 days to process this request, and most landlords and tenants alike cannot wait this long.

An easier and faster way to verify their income is to file Form 4506-T, which is a request only for a transcript of the tenant’s tax returns. This typically only takes a single business day to receive and contains the information you need to verify a self-employed individual’s income.

 

Be Wary of Fakes

As a landlord, you should always do your due diligence when it comes to tenant screenings.

While most of your prospective tenants will be upstanding members of the community, you may sometimes need to dig a little deeper.

Ask detailed questions if you have even the smallest suspicions about the listed references for a prospective tenant. Check to see if the employer says the applicant has ever been any trouble, makes enough money to cover the rent, and maintains gainful employment.

You should ask the person you’re speaking to verify their name and position within the company, and double check with what was written on the application in front of you. Sometimes, a tenant could have friends or others pose as their supervisors.

If your prospective tenant cannot provide you with any of their paystubs, ask for W2s or 1099/1040 forms. If they cannot provide these, it may be time to move onto the next applicant.

And remember, if you need any extra help verifying your tenants, reach out to an Abingdon property management team and rely on their expertise. Our team at Bay Management Group would be happy to help you select the best tenants for your properties.

 


A Step-by-Step Guide to Maryland Tenant Eviction

Guide to Tenant Eviction in MarylandAs a landlord, you probably don’t want to deal with eviction. If you keep giving tenants “second chances” trying to solve the issues peacefully, you need to stop and reevaluate the situation. One second chance is usually enough to tell you whether the problem tenant straightened out.  Putting off eviction any further means you are losing money – don’t forget that you are running a business!

When it comes to evicting a tenant, you have a set of rules and laws to follow. Our specialists at Bay Management Group have put together a few tips on how to go through with an eviction.

Why does your tenant have to be evicted?

You can’t just evict a tenant based on personal aversion or the fact that your tenant filed a complaint or a lawsuit against you. Tenant’s rights are protected by the law and violating them may get you involved in a costly litigation. Here are the grounds on which you can evict a tenant in Maryland.

Your tenant didn’t pay rent.

If the rent is due on the first of each month and you don’t receive it, you technically can start the eviction process on the second. We recommend talking to your tenant before resorting to this radical measure. Failure to pay on time doesn’t mean your tenant has no money – he or she could have had family emergency or technical issues with the bank. A single instance of late payment is not a reason to evict otherwise diligent tenant.

Note: it doesn’t matter if a tenant is deliberately not paying rent because he thinks you are slacking on maintenance and repairs – you can still start eviction. This is a separate issue and your tenant is free to go to court to seek compensation.

Your tenant didn’t move out.

So, the lease has ended and your tenant is still occupying (a.k.a. “holding over”) your Maryland property. In this situation, eviction is a reasonable outcome. You might already have a new tenant ready to move in, so the sooner you start the process, the sooner you will have your property back.

Your tenant breached the lease.

If any condition of the lease is violated, you have the right to remove tenant from the property. Some examples are:

–    A tenant brought pets in a pet-free apartment

–    There are more tenants residing on the property than the number stated on the lease

–    A tenant damaged or otherwise modified a property in a way prohibited in the lease

Additionally, the State of Maryland can bring action against your tenants if they are involved in illegal activities, specifically drug-related. As you can see, there are quite a few legal issues you need to be aware of – something our Baltimore property managers are trained in and happy to help you with.

 

How to evict a tenant in Maryland

There is a set of procedures you need to follow in order to remove a tenant from your property in accordance with the law. We’ll cover them shortly, but first let’s discuss what you can’t do.

  • You can’t walk into your tenant’s apartment without notice and demand they’ll be out by the end of the week.
  • You can’t physically or verbally threaten the tenant.
  • You can’t cut off utilities, change locks or remove tenant’s belongings from the property before the eviction process is complete.

 

To evict a tenant, follow these steps:

  1. Whenever possible, especially in the case of a first-time mild offense, try to reason with the tenant.
  2. Serve an eviction notice (in writing) that will state the reason for eviction and give a tenant 1 month to vacate the property (14 days if tenant’s presence poses danger to the neighbors and the community). When applicable, include on the notice how a tenant may stop eviction.
  3. If upon the date stated in the eviction notice the tenant doesn’t comply, proceed to file a complaint with your District Court requesting an Eviction Order. Here are step-by-step instructions from the Maryland District Court.
  4. Attend the trial and bring all the documents proving you have a valid reason to evict the tenant. If you are seeking monetary compensation from the tenant, go here for more details.
  5. Once you receive judgment against your tenant, he or she has 4 days to appeal. If they don’t appeal, you can file a Petition for Warrant of Restitution with the sheriff. Once it’s processed, you can schedule an eviction date.
  6. On an eviction day, you need to have movers ready to rid your property of tenant’s belongings. The belongings are left on the public property and are now the responsibility of the tenant.

The entire eviction process may take anywhere from 2 to 6 months. And during this time you might not be getting any payments from the tenant.

Of course, you can attempt to recover your losses through court, but this may take even longer. Offering full-service property management in Washington DC, Baltimore, and Philadelphia, the teams at Bay Management Group know that in some cases eviction is often a necessary measure.

However, you should take every step to avoid it, and the first one is thoroughly screening your tenants.

A complete credit history, reference and background check are crucial for finding reliable and responsible tenants. Take the time to conduct tenant screening or call us and we’ll help you manage your Baltimore, York, Lancaster, Dauphin, Cumberland counties or nearby property in Maryland.

 


3 Steps to Finding a Perfect Tenant

pig in mudWe are all looking for that neat and responsible tenant who will respect the property, keep it clean and pay bills in time.  And it’s not always easy to judge reliability from a brief meeting and a pile of paperwork. At Bay Management Group, we’ve put together a few pointers that will help you find that perfect tenant and highlight the possibilities for a compromise if the search is taking too long.

Start with your property

The condition of your property will ultimately affect what kind of tenants it will attract. You can’t do anything about the location, but keeping the property clean, updated and well-maintained is in your hands. Outdated appliances, dirty walls and untidy bathroom may scare away your potential tenants, especially if the price is high.

Rethink the layout and possibly knock down a few walls to make a bigger bathroom or add a walk-in closet. Provide the top amenities your tenants want, and you’ll have plenty of candidates to choose from. If you don’t want to mess with the renovations, just keep the property clean: a fresh coat of paint, a scented candle and clean sunny windows can make a big difference. Remember, first impressions matter!

Screen your tenants

As Baltimore property managers, we advice you not to let an unscreened tenant move into your rental, no matter how desperate your might be to close the deal. Even if the person was recommended by your friend, take the time to conduct at least minimal screening. Here are some things you might want to check:

Attitude and behavior. Take mental notes when you first meet a potential tenant. Did they make an effort to dress nicely? Are they kind and polite? What kind of car do they drive and is it clean? Of course, you can’t judge people by these characteristics alone, but they should help you paint a bigger picture.

References from previous landlords. Do verify the reference by calling the former landlord, as it’s easy to forge a reference letter or have a relative write it. It’s also a good idea to ask how much the tenant was paying in rent at his former place.

Employment status. Your tenant should be employed, preferably for some time. You can request recent pay stubs and even talk to the employer to get more insights.

Credit history. Request a credit report on your potential tenant. Look for any open collections, late payments, bankruptcy and overall credit score. The report itself might cost you, but it’s better to be safe than sorry.

Criminal and eviction records. Find out if your tenant has had problems with the law in the past or is currently a part of an investigation or a litigation. You probably might want to reject someone who’s been arrested for public disturbance multiple times.

Social life. With social networks playing an important role in many people’s lives, almost everyone has a digital footprint. Search an applicant’s name in the search engines and look over their social profiles and other publicly available information. This will give you a better idea about their personality and lifestyle.

Besides conducting a thorough background check, also let your potential tenant tell their story. Find out why they are moving, what they do for fun, and see if everything they say matches the reports you’ve obtained.

Learn to compromise

It’s unlikely that you find a tenant that has everything you are looking for. Being picky is good, but don’t bluntly reject applicants based on certain things you uncover during the background check. Remember, every month your property stays unoccupied, you are not just failing to make profit, but possibly losing money as well.

Instead of focusing on separate accounts of “irresponsible behavior” on the part of your potential tenants, look at the bigger picture:

  • Everyone makes mistakes, and a criminal charge or an unpaid debt from back in the days doesn’t define a person. Focus on the past five years instead of considering someone’s entire history.
  • When screening couples, look at the combined income if low individual income is the only issue and everything else checks out.
  • Appreciate the honesty when someone tells you upfront about their bad credit or other issues. This means they understand the consequences of the bad decisions they made in the past and want to mend things.

A bad tenant can be a disaster to your rental property business. If you have multiple properties and consistently struggle to sort through dozens of undesirable applicants to find that perfect one, let us know and we’ll take that burden off of your shoulders.