Letter on Selecting Tenants

Radio Host Mark Maxon Radio Host Mark Maxon

Below is an email that I received from someone who recently signed up for my 7-week informational course based on my book How to Start a House Fix up and Rental Business. I removed the name to protect her privacy.

It was great hearing you on Mark Maxon’s radio program this am. My son is again trying to do what you did. The first one didn’t go well. Can U tell me how U selected your tenants? Also I am in an interest only mortgage & want to get out of it. I applied for a Loan Modification & it’s been dragging on.

Any ideas? It would be greatly appreciated. Thanks again for offering your course to help folks like us.

Sincerely, xxxxx

—————–

My response:

Hi xxxxx,

Thank you for the note.

I think the hardest part of the rental house business is finding good tenants. In many ways, the only way to get good at it is to just do it. You make a few mistakes along the way, but you get better with each passing year.

But, there are also some key things you can do to help get good tenants.

1. Have the tenants fill out an information sheet, requiring them to list previous places they lived, list bank account info, job info, etc. Call all of their references, their bosses, and their old landlords. Verify their salary. You may be able to check county court cases on-line like we can here in Tucson. If so, run a check on their name.

2. Read through the entire contract with them before they sign it. Emphasize the penalties they face if they pay late.

3. Enforce the contract. If they pay late, call them immediately, and require that they pay the penalty (I charge 1% of the total rent per day that they pay late).

4. Get a book that describes landlord rights in your state. These books usually include legal forms that you can mail to bad tenants, to make them comply with your contract, or to evict them.

Sorry, I don’t have any knowledge about getting out of an interest only mortgage, or the loan modification process. There was recently a mortgage broker on Mark Maxon’s show. It might help to contact someone like him.

Best of luck to you and to your son.

Terry Sprouse
Add to Technorati Favorites

Subscribe in a reader

Share this: del.icio.us | Digg | Ma.gnolia | Reddit | Stumble Upon |

0saves
If you enjoyed this post, please consider leaving a comment or subscribing to the RSS feed to have future articles delivered to your feed reader.

Tags: , , , , , ,

2 Responses to “Letter on Selecting Tenants”

  1. […] Finding the right tenant is a common challenge that most property managers encounters at one point or another in their life. The following bits and pieces of information in this article will allow you to have a better idea in picking the right or ideal tenant. […]