Common Maintenance Issues and How a Landlord Can Resolve Them

One of the biggest challenges that landlords face on a continuing basis is maintenance.

No matter how new or how well-built the property is, sooner or later you will have to deal with repairs and maintenance needs.

For first-time landlords, this can be especially difficult if they don’t know where to turn.

Have a Plan
Minor repairs can happen at any time, but they most often occur when it is least convenient.

You will get a phone call when you are sitting down to dinner or getting ready for bed.

To prevent the inconvenience that this can cause, you need to have a plan in place to ensure the issues is quickly and efficiently resolved.

Some issues are regular occurrences, like heating and HVAC problems, backed-up plumbing, and lockouts.

Be prepared for these situations by contracting with a company that you can call any time you need their services.

You can give the company a key and sign a contract for 24-hour service with a specified response time.

Just make sure you let tenants know that this is the procedure for these calls.

Larger problems such as a leaking roof may require a temporary fix until a more permanent solution can be provided.

In some cases, the roofing contractor may handle the situation while other times, you may need to find someone else who can stop the leaks temporarily.

Always know which companies you will contact for the various problems you are likely to encounter and find out exactly what services they provide and in what time frame they respond.

Hire Someone to Handle Maintenance Issues
For a larger rental complex, you may want to hand off maintenance calls to a service or manager.

You have several options to choose from:

  • An answering service takes calls from tenants and contacts the appropriate repair company to handle the work based on your instructions. They relay the problem to you on the next business day or with the call logs.
  • A property manager takes care of all tenant problems, including maintenance requests. The manager updates you or contacts you for unusual problems.
  • Pay a tenant to handle simple maintenance issues in exchange for reduced rent.

No matter which option you choose, you must have a clear plan of action for the most common repairs and maintenance problems.

Make sure that you relay the important information to all parties, including when you want to be contacted and how you will be informed of any resolved issues.

You also want to have a standard process for what to do when something unexpected arises that is not part of your plan, such as a flooding or a fire.

When major issues occur, you should have an emergency plan in place and procedures for the next steps.

You must provide a valid number where you can be reached or another person to act in your stead if you cannot be reached.

Having a complete maintenance plan in place helps you and everyone else know what to do when something happens.

It is also important that you relay the basic procedures to your tenants.

Let them know what steps will be taken and the timeline that they can expect a phone call or the issue to be resolved.

By having a plan in place, it protects you from minor repairs turning into major problems, and it keeps your tenants happy.

How To Repair a Leaky Outdoor Faucet

Outdoor faucets eventually begin to leak and it can become an annoying issue.

Sometimes more water comes out of the faucet than it goes into your hose or sprinkler system.

You can fix the outdoor faucet pretty easily in most instances, but depending on the size of the leak, you may need to replace the entire faucet.

 

The Seals and Gaskets Wear Out in an Outdoor Faucet

The #1 repair for a leaky outdoor faucet is a seal or gasket that needs to be replaced.

They’re often made of rubber or even plastic today, so over time, they just wear out.

You’ll be able to access them by taking the removing the handle of the faucet to access the interior hardware through the retaining nut.

When you’re there, check to see how tight it actually is.

A loose retaining nut may be the cause of your leak.

If the retaining nut is tight, then you’ll need to remove the faucet stem.

It’s usually easier to remove the stem by installing the handle again so you can grip it.

Sometimes you have to even turn the handle to remove the faucet.

Replace the Washer Assembly In the Stem

With the faucet stem out, you will notice that there is a washer assembly that can typically be accessed by a Philips head screwdriver.

Unscrew the item and you’ll be able to see which washers have failed. Keep track of how the parts go together so you can replace the faulty item and then reinstall the washers on the stem.

You may also need to replace the stem packing or remove the vacuum breaker cap to locate the faulty parts.

The vacuum breaker can sometimes fail because of dirt or sand that gets inside the faucet itself.

If you clean the breaker, then you may fix the leak.

If all of that fails to work, then you will likely need to replace the entire faucet.

If your faucet is screwed onto your plumbing, then you can just remove the old faucet and attached a new one.

If it is a one piece unit, however, you’ll need to cut it off and then solder the new outdoor faucet on.

By following these steps, you’ll know how to fix a leaky outdoor faucet.

It only takes a few minutes to repair and in return, you won’t be risking future water damage to your property once it gets fixed.

How To Check For Evictions

Part of the tenant screening process for any landlord must include an eviction search. Tenants that have past evictions may not be a true reflection of their potential value in a lease, but it does indicate that they are a high-risk tenant that may not be right for you. Eviction records are considered part of the open public record, so these red flags are pretty easy to spot. The easiest way to check for evictions is to have a credit check as part of the tenant screening process. Evictions are typically on a credit report and you’ll also get to see a brief overview of a tenant’s financial situation at the same time. You’ll need written consent to receive this report, so don’t just run the credit check because you could find yourself at risk for litigation, fines, or both if you do. Here are some other ways that you can check for evictions as well.

1. Obtain Information About Previous Residences.

During the tenant screening process, it is not uncommon to ask for up to 3-5 years of previous addresses. This gives you two pieces of good information: how stable the household structure is and information to contact a previous landlord. To speak with the landlord, however, you’ll need written authorization that can be sent via email or fax to get the information that is needed.

2. Contact the County Court of a Previous Address.

If you don’t get authorization to speak with a former landlord, then take advantage of the open public records. Check the eviction records for that county. If a tenant was ordered out of a residence, then a writ of possession will be on file for the property in question. Unless it is a rural county, there’s a good chance that this information can be found online.

3. Look for Judgments on a Tenant’s Records.

When you pull the credit file for a tenant, you may not see an eviction in place. What you may see in its place is a judgment from a lawsuit that was initiated by one of the previous landlords of that potential tenant instead. You may need to pull credit reports from all 3 major credit reporting agencies in the US to verify judgment records.

4. Request a Tenant Screening Report.

A number of professional agencies provide complete tenant screening reports based on the personal information an applicant provides you. In return for a service fee, which can often be charged to the applicant, the organization creating the report will obtain a criminal history, credit information, and a complete examination of any public records that will give you an idea of how risky a tenant may be.

5. Not Every Eviction is Something That a Landlord May Initiate.

There are some jurisdictions that allow law enforcement officials to initiate an eviction based on the arrest of a renter for a drug charge or other illegal activity. Landlords in this situation are generally given 30 days to evict the tenant on their own, but law enforcement will complete the eviction at the end of 30 days if the landlord has not done so.

6. It is Important to Remember That Not Every Eviction Attempt Winds Up in an Actual Court-Ordered Eviction.

When a landlord gives their tenant a notice to pay or quit, that means a tenant has the option to actually quit. That means they must move out of the rental property by a certain date. This action is considered to be an eviction, but it is not a court-ordered eviction. The same is true for tenants who might move out by a notice date for other lease violations, such as having a pet that is not allowed. This is why it is important to check all references and records and not just rely on public information or references only.

7. Evictions on a Credit Report Can be Disputed.

It is also important to realize as a potential landlord that credit-based eviction information may be placed there in error. A potential tenant may not have been evicted, but a previous landlord may not have stopped a court proceeding and received a default judgment because notice wasn’t given as indicated. It’s unlikely, but it does happen. If an application is in the process of disputing an inaccurate eviction report on their credit, then this should be combined with other screening information to render an empowered decision. Screening for a past eviction is an important part of any tenant application process. If you are not doing this already, then follow these steps to begin locate eviction information now so that you can limit your risks.

The Top 5 Tax Deductions For Rental Property Owners

There are many landlords who pay more taxes than they should every year, usually because they aren’t familiar with the deductions they can claim. It takes a thorough understanding of tax law and strategic planning to take advantage of all available deductions. Here is a guide to the top five deductions you should claim.

1. Deducting Interest
Perhaps the most important deduction to take is on interest payments, which can represent a significant amount of money each year. This can cover many types of interest payments, including interest on mortgages and loans that were used to purchase or improve your rental property. These interest rate deductions also extend to credit card interest payments that were used to purchase goods or services in relation to your rental properties. Remember that this doesn’t apply to the principal that you initially paid for the property, only the interest accrued.

2. Repair Deductions
The cost of repairs can add up significantly over the year, but the good news is that these repair costs can be deducted from your taxes. Repairs to your property can take many forms:

  • Fixing leaks
  • Repainting
  • Patching a roof
  • Plumbing work
  • Replacing a broken door
  • Plastering a hole in a wall
  • Replacing a shattered window
  • and more

Be sure to keep receipts and records of all repairs you make. Also be aware that you can only deduct repair costs made the year you performed them, so be sure not to wait on this deduction until next year.

3. Travel Costs
Do you find yourself traveling constantly to repair property, pick up building supplies or meet with a tenant to discuss a problem or complaint? The great part about travel-related expenses is that they are all deductible. This even applies to overnight travel involving flights to other cities. For example, if you attend a real estate conference to help you understand how to improve your business, the plane ticket and hotel costs would also be deductible. At the same time, overnight travel is likely to be the most scrutinized by the IRS when you file your taxes, so it’s important to keep thorough records that can back up your deduction in case of an audit.

4. Depreciation Deductions
Depreciation is one deduction many landlords don’t quite understand; however, this can add up to big savings every year. The basic concept of real estate depreciation is that the IRS allows landlords to claim a “paper loss” on the value of their property. This is based on a model that stipulates that properties will lose value over 27 and a half years, which brings the value of their property from what they originally paid for it to the price of zero dollars.

Each year you can claim 2/55ths of the purchase price for 27 years. The formula for depreciation can be much more complicated and often requires an accountant for proper calculations. It’s worth the extra work, though, due to the amount of money that can deducted. Don’t forget to deduct the cost of using your accountant either, which is also permissible when it’s related to real estate activity.

5. Insurance Premiums
If you own a rental property, you’re probably paying quite a bit for insurance. This includes flood, fire, and theft insurance, as well as certain liability insurance expenses. You might even be paying for your employees’ workers compensation and health insurance. Thankfully, all of these insurance premiums are deductible.

As you can see, there are numerous deductibles available to landlords that you can use to maximize your savings. Include these five on your list of deductibles, and you’ll be doing your rental property taxes the right way.

 

Please note: These articles are for informational purposes and we advise you to consult an attorney for more specific information related to your situation.

What Is a Wrongful Eviction?

There are always going to be problematic tenants from a landlord’s perspective.

From the tenant’s perspective, there are always going to be problematic landlords.

A vast majority of tenants and landlords have a mutually beneficial relationship that works for both groups.

When that relationship turns sour or there is a lease violation, however, a wrongful eviction can easily happen.

What is a wrongful eviction?

It is when a property owner, a landlord, or an agent acting on behalf of either party forces a tenant out of a residence without legal authorization to do so.

There are a number of ways this might happen.

1. By changing the locks on the building in question after removing personal effects.

2. By shutting off the utilities to the building.

3. By bullying the tenant into leaving the property through abuse and intimidation.

Tenants often have a lot of leeway to correct the issues that they may have created.

Most landlord-tenant laws require that a property owner, landlord, or agent give that tenant every opportunity to rectify the situation.

That’s why a specific eviction procedure must always be followed.

Landlords Almost Never Have Authorization To Remove Tenants

Only in specific jurisdictions is there any authorization for a landlord to physically remove a problematic tenant.

Most of the time the tenant who is in violation of a leasing agreement must be notified that they are in violation in writing.

They will be given a specific time frame to rectify that violation so they can return to compliance.

The most common reason why a tenant falls out of compliance with a leasing agreement is because of a non-payment of rent.

Any violation of the lease can be grounds to send a violation letter, but landlord-tenant laws have a specific amount of time that ranges from 3-30 days to rectify the violation.

Only if the violation is not rectified by the deadline given on the notice can a landlord then proceed with a formal eviction.

To do so, an “unlawful detainer” must usually be filed in the local court system.

Did You Know Tenants Can Evict Themselves?

Landlords, property owners, or their agents can also be “evicted” by tenants for the same reasons.

If a landlord fails to live up to their obligations in a leasing agreement, a tenant is allowed to send notice of this violation in writing and be guaranteed protections against retribution for such an act.

If the property being rented does not meet basic needs in a specific time frame, often just 24 hours, a tenant may “evict” themselves from the lease without penalty.

Tenants who legally break a lease must still surrender the property in a condition that is equal or greater to the condition they received it.

A security deposit cannot be used in this situation to correct an issue that was reported as a violation of the lease by the tenant.

Otherwise all other applicable security deposit laws are generally enforceable during the separation process.

Why Can’t Self-Remedy Options Be Legal?

It would be a lot easier to be able to just evict some tenants without court intervention and legal fees, but the rights of a tenant cannot be overlooked.

It might be your property, but it is a tenant’s home.

The law protects this right.

You entering a home without permission or a legitimate emergency could be construed as breaking and entering and that means a tenant has a right to defend themselves and their property in many jurisdictions.

That’s why letting the court system and law enforcement handle a problematic is a good idea.

It keeps everyone safer and although it may be an added cost, it is generally a cost that is worth spending.

This process also eliminates any litigation costs that may come from accusations that a landlord stole or damaged personal property during the process.

Just like most tenants won’t need to ever be evicted, most tenants that receive a violation notice will rectify the situation.

For those that receive a court-ordered eviction, they will leave before law enforcement arrives.

Only a small minority of tenant will need to have a full eviction, just as a small minority of landlords break leases on their end as well.

What is a wrongful eviction?

It is any process that attempts to remove a tenant from a property without legal permission.

Make sure to follow the steps outlined in your local landlord-tenant law today so that you can stay in compliance.