Oct 08

Our world is full of traps for rental owners… Fail to document the deposit return letter when was sent and a $300 deposit turns into $5,000 with attorney fees. Try to be helpful and not rent the third floor walk up to a person with a bad leg and pay $10,000 in a Fair Housing claim. Likewise tell the person with the companion dog that there is no way you are renting to a person with a Pit Bull and pay another ten grand. Give the tenant with a year lease a 14 day for disturbing the neighbors and breaking your windows or the tenant with a month to month a 5 day for the same reason and you will have to start your court case all over again. The list of pitfalls is endless and growing.

So how do you collect your rent, fill your vacancies and evict tenants without getting in trouble or having expensive do-overs?

You could throw your arms in the air and give up, but that probably is not the most effective approach. You can go through life figuring these are things that only happen to the other guy or to”bad” landlords. That works for a while until you become the other guy. You could hire an attorney to be along side you for every decision, but that probably is not financially effective.

The only viable answer is to know the laws that affect us well enough to either know the answer or know when you need help. You can venture out and learn as you go through your own mistakes, usually a very expensive education – there is a reason they call it the school of hard knocks, or you can get as much education as practical before you find yourself on the losing end of a legal battle.

I started with the learn as you go method. It cost me three grand in 1982 dollars when a tenant that snuck out in the middle of the night sued for their deposit. I lost because I did not know the law well enough to make the proper argument that the 21 days did not start on the day they skipped out, but rather on the day I found they moved. So my letter sent seven days after I found a vacant apartment was proper, but laws only work for those that know them.

My next education was a Bob Smith Landlord Tenant Law course at Marquette. Much more informative and less expensive. A couple of years later Bob condensed this into a full day landlord tenant law for the Association. It cost somewhere around two hundred dollars and included his book “Landlord Defense: Eviction and Collection manual” that had most of the forms needed. For those who want to stroll down memory lane, here is a Sentinel article with a really young picture of Bob:

The Association continues to offer the best landlord tenant law course out there. The Landlord Boot Camp gives you the fundamentals in a full day Saturday class. It is updated to include the latest law changes and includes a 100 page plus manual. It is presented by Attorney Tristan Pettit who writes the standard landlord tenant forms for Wisconsin Legal Blank. Tristan also worked on SB179 that may become law later this month. If it does pass he will have an insiders view on how this law can be best utilized by owners.

The next Boot Camp is Saturday October 26th 8:30 AM to 5;30 PM. Costs is $159 for AASEW members and $249 for non-members.

Learn more or sign up at:
http://landlordbootcamp2013.com/

Apr 23

HUD is reporting

Rental housing markets in major metropolitan areas of the Midwest region are balanced to tight, with rent increases reported in all major markets, continuing a year- long trend of strengthening conditions.

http://www.huduser.org/portal/periodicals/ushmc/winter11/USHMC_4q11_regional.pdf

(The linked document contains rental and housing stats for the entire nation)

Feb 05

Late fees are an important tool to get your rent in before the mortgage is due.  But what is a reasonable or legal late fee?

There is a WI case that found $50 on a $625 rent was reasonable, THREE  & ONE CO. v. GEILFUSS, 178 Wis.2d 400 (Ct.App. 1993) – yes this is the same case that found letting the cat use the house as a litter box constitutes waste. Again, this one of those cases that every owner should keep in their  “toolbox”

As far as the per diem (per day) late fee, that may be another story.  We have never used these, but many owners do.

The Hud “Model Lease” does contain a provision of $5 after the 6th and a dollar a day in paragraph 5.  However private owners use higher per diem rates.

Some tenant advocates here and elsewhere are attacking the per diem late fees on grounds that they run afoul of usury laws. From their prospective for example your late fee has an APR of something like 900%. Assume your tenant misses January’s payment and doesn’t cure it for a year. They would owe $7280 on $800 debt.

The problem with a single fee is once the 5th comes and goes, what  incentive is there for tenants to cure the problem quickly after receiving the late fee other than eviction?

After much consideration our company is considering moving from a flat $30-50 fee to a two step fee. The first late fee that posts after the close of business on the 5th is around 80% of current late fee, with a second late fee posting on the 11th totaling 150% of current late fees

Oct 08

There is a lot of frustration among owners with changes to the eviction procedures in Milwaukee County.  It seems something changes every month, all to the detriment of owners who just want to get rid of freeloading tenants.

The Apartment Association wishes to quantify what problems are of the greatest concern to owners then see what can be done to correct the problems.  Some will be reasonably easy to fix, some not so.

You can post your comments here or if you are a bit shy email me directly at: Tim@ApartmentsMilwaukee.com

I’ll start the discussion:

The law says ‘the court can’t issue a stay on eviction, without the tenant paying all past due rent.’ *  But the courts give out stays like neighbors give out candy on Halloween.

* Obviously laws are not that concise, what it actually says is:

799.44(3) Stay of writ of restitution. At the time of ordering judgment, upon application of the defendant with notice to the plaintiff, the court may, in cases where it determines hardship to exist, stay the issuance of the writ by a period not to exceed 30 days from the date of the order for judgment. Any such stay shall be conditioned upon the defendant paying all rent or other charges due and unpaid at the entry of judgment and upon the defendant paying the reasonable value of the occupancy of the premises, including reasonable charges, during the period of the stay upon such terms and at such times as the court directs. The court may further require the defendant, as a condition of such stay, to give a bond in such amount and with such sureties as the court directs, conditioned upon the defendant’s faithful performance of the conditions of the stay. Upon the failure of the defendant to perform any of the conditions of the stay, the plaintiff may file an affidavit executed by the plaintiff or attorney, stating the facts of such default, and the writ of restitution may forthwith be issued.

Aug 09

Fellow landlords

What services, tools, resource, supplies, innovations, changes in laws, grants, education, support from fellow owners etc. do you find lacking, unavailable, too expensive, too difficult to obtain, change etc.?

You get the idea…what do you see as the three, four or twenty things that would make your business more successful? Skies the limit. If it has to do with landlording or real estate investing throw it on the list.

Don’t worry if you think it is “doable” or not, Wild Ideas welcome and encouraged. But also don’t put off posting the more pedestrian needs and wants either.

You can leave comments, here or via private email to me at Tim [at] JustAlandord.com (makes sending the truly wild and innovative stuff easier for shy folks like me.)  I’ll compile the list for all to see.

Some will have readily available solutions that will be posted and shared, I’m sure.  Others are things our industry should be working on finding, changing, designing etc.

Some rather thought provocative comments below. Many of these were sent via email or posted on one of the list serves and reposted here as a central collection place. Please throw yours into the mix — Thanks Tim


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