There’s a chance that some of the ideas that I am going to present to you, you’ll disagree with, swearing that you would never do that for a renter. That’s ok. When you are struggling to collect rent or worse, going through the gut-wrenching act of evicting a family that is living in your property rent-free, come back and re-read these ideas

Please keep in mind that I strongly urge you to buy attractive homes, in nice areas. These types of homes will attract the type of tenant that you want and are looking for.

So here you go, the 10 steps to being a good Landlord/ Landlady:

1)      On Time Rent Rebate:

·        The cornerstone of my system is the “On Time Rent Rebate”.  If my tenants pay on time or early I reward them. After their rent check has cleared, I send them a rent rebate check for $50 to $100. People are highly motivated by the fear of loss; no one wants to loose $50 to $100. They will pay on time.

·        If they are late, I am aggressive in tacking on late fees up to $100 plus $15 to $25 daily. I let them know that if day five rolls around, and I don’t have my rent, I will begin the eviction process. Period.

·        Great rewards for being a good renter. Strong punishments for being a bad renter.

2)      Rental Application:

·        If the rental application form is not fully and completely filled out (and readable), then it goes in the “no way” pile.

·        If they don’t include the application fee (to pay for the credit check), those applications also go in the “no way” pile.

3)      Credit Check:

·        This is so easy and cheap to do online; there is no reason not to do a credit check. I have found that up to 80% of the prospective renters have horrible credit. You want the renters with fair to good credit.

·        Check their driver’s license to make sure they really are who they say they are, so you pull the right credit history.

·        If you put the words “Credit Check” in your For Rent ad, that will help cut down some on the “bad credit” renters who want to look at your rental.

4)      Showing the rental property:

·        You can use your showings to cut down on undesirable renters: Only show the property 3 times a week for 15 minutes each time. For example, when a renter calls, after giving them the info on the property, I ask them if they want to see it. If so, I will tell them that I am showing the home “tomorrow night from 6:00 to 6:15”. Schedule all of the renters that call for the same time and day.

·        Having a bunch of renters show up at the same time lets each renter know that they are not the only people I can chose from. I tell them all that I am taking applications and will decide in 14 to 30 days. Even if you decide sooner, this gives you a chance to find just the right renter without pressure.

·        If a renter shows up late, their application goes in the “no way” pile. If they can’t show up on time for an appointment, will they pay their rent on time?

5)      The qualification form:

·        When the renters show up at the rental, they are given a rental application and a form that has all of the criteria that I look for in a renter. If they don’t fit my criteria, they’ll know why I didn’t rent to them and can’t claim discrimination. Here is my current form:

What I am looking for in a renter:

o        You are willing to sign a 6 month lease.

o        You want to move in right away

o        You will have been working for your current employer for at least 6 months or in current field for at least 2 years. (You can show that you have stable work history.)

o        You will have fairly good credit scores, with no late pays in the last 2 years.

o        You will have no evictions. Bankruptcies need to be at least 2 years old and explained.

o        Verifiable rent history going back 2 landlords.

o        You will have a high enough income to pay rent and keep current on bills (credit cards, car payments etc.).

o        No felonies

o        No large pets (Dogs, cats, etc.)

6. Check the Jobs:

·        You do this in two ways; first call the business that the renter claims to work for.

·        Second, ask the renter to bring you their most recent paycheck stubs.

7. Check the rental history:

·        Call and talk to their last two landlords.

·        Their current landlord may just want them gone and will say anything to get them into your rental.

·        The previous landlord will tell you the total truth.

8. Check your gut:

·        What does your gut say about the renters? If you have a bad feeling about them, don’t rent to them. Let the property management companies rent to them.

·        Another way to judge is the “dinner test”. If you wouldn’t have dinner with them, you probably shouldn’t rent to them.

·        An additional way to evaluate the prospective renters is to imagine standing face to face with them, demanding your rent. Would you be afraid of them? If so, don’t rent to them.

9. Your renters are your customers:

·        I handle maintenance requests as fast as possible. My goal is to have the repair done within 1 business day.

·        They are helping you become wealthy. Treat them right, and if you have chosen right, they will treat you right.

10. I have had good success with charging slightly below market rent.

·        After paying the “On Time Rent Rebate”, the rent is always a little less than market. Because of this, I get more potential buyers to choose from, my vacancies fill faster, and the renters hopefully will stay longer.

• John Schaub says us "little investors", should charge less rent than we can get, and charge a larger damage deposit. This just makes sense. Visit John's website here.

·        Making mortgage payments on empty properties will eat you alive. I like to sleep at night.

This is a complicated business. Educate, educate, educate. Start by buying the two books I mentioned.

Bookmark this page, with a little luck and savings; you may need this information someday soon.

Darn, a disclaimer:  These ideas are my opinion based on experiences I have had in the real estate business. This information is not to be considered legal advice. I am not an attorney. The user of this information accepts full responsibility for its use. The author retains copyrights to this article. Please contact me to reprint or post.

Copyrights, Don Glasgow, 2004, 2005, 2006