What to do if your listing is a victim of this scam

Email the details to abuse [at] craigslist [dot] org. Be sure to include the URL (or 10-digit post ID number) in your message. For further recommendations, check out the Craigslist page on who to notify about fraud attempts. You may also report it to the FBI’s Internet Crime Complaint Center to help them determine the extent of the problem.

Rent to own contracts go by many names (and take many forms):  rent to own, contract for dead, lease option, etc.  These are creative ways that landlords and tenants/buyers have put together to allow someone with marginal credit (tenant) to buy the house they want.  Depending upon how the relationship is constructed and documented, it can be a win/win or a lose/lose for both parties.

On Wednesday, October 21, the Minnesota Real Estate Team will be holding is next Investment Property 201 seminar.  We will have Attorney, Matt Engel discussing how to best architect these relationships.  He will demonstrate the pitfalls and common mistakes that many landlords make and how to avoid them.  Matt will explain the best design for these relationships to minimize the legal ramifications if the relationship goes poorly.

Join us on October 21 at 6:30 pm if you have previously written these deals or have always had an interest in them.  Contact us now by filling out the registration form or call me at 612-281-5419 for more information.

Here goes…As most of you know, Craigslist ads are quite dry and simply text in a white background.  You can add HTML to the ad, but that is time consuming and not for the average non-geek.  A customer of mine recently posted a “For Rent” ad on Craigslist.  He wasn’t getting many calls so I told him to send over the ad.

What he sent over floored me.  It was a colorful, well-formatted web page inside of Craigslist.  This customer happens to be a geek so I figured he wrote the entire thing in HTML and posted it.  When I mentioned it, he said he found a website called Postlets.com.  This free service allows you to create a beautiful page for your rental ad or your “home for sale” ad and then simply cut and paste the HTML into Craigslist.  You can add up to 18 pictures and even a virtual tour!  If you upgrade to the paid service you can have a single property website.

See a sample here:  http://www.postlets.com/rem/2172858

Now, no more boring Craiglist ads.  Start using this today!

First, who is considered handicapped under the law?  The federal Fair Housing Act and Fair Housing Amendments Act (42 U.S. Code §§ 3601-3619, 3631) prohibits discrimination against people who:

• Have a physical or mental disability that substantially limits one or more major life activities — including, but not limited to:
  • mobility impairments
  • hearing impairments
  • visual impairments
  • chronic alcoholism (if it is being addressed through a recovery program)
  • mental illness
  • HIV, AIDS, and AIDS-Related Complex, or
  • mental retardation
• have a history of such a disability, or
• are regarded by others as though they have such a disability.

Here are the general rules that you must follow as a landlord (if you have further questions, I recommend you contact an attorney or a special interest group):

• As a landlord, you may not ask an applicant about any handicaps.
• You must base your decisions to rent to (or continue to rent to) a person solely on the basis on credit, criminal, and rental history.  You may not deny them solely because of their handicap.
• Even if it is obvious that they are disabled — for example, they use a wheelchair or wear a hearing aid — it is nevertheless illegal to inquire how severely they are disabled. In practice, if there are units available on the ground floor and 2nd floor in the same complex, you must offer both units to a person in a wheelchair, even if you believe they would not be interested in the 2nd floor unit.
• Landlords must reasonably accommodate, at the landlord’s expense, the needs of a disabled tenant such as (but not limited to):  rules, procedures, services to give the disabled tenant an equal opportunity to enjoy the common elements and his/her unit.  Designating the front parking space would be an example of this.
• Alternatively, landlords must allow a disabled tenant to make reasonable modifications to their units or common areas at their expense in order to allow the tenant to live comfortably or safely in their unit.  These modifications may not interfere with current or future tenants ability to use the property.  Typical modifications that can be done (and paid for) by a disabled tenant can include:  installing a ramp to allow wheelchair access, installing special faucets or door handles to allow for tenants with limited hand mobility.  The landlord can require that they changes are removed once the tenant leaves the property and can only be done with prior approval.
• If the need for the modification to the property is not obvious (such as a wheelchair ramp), the landlord may request a doctor’s letter prior to approving the change.  This is especially common in mental illness disability and/or phobias.

While this is not an exhaustive list, you need to be aware that you must give a handicapped tenant or applicant every opportunity to rent your apartment.

Bank Owned properties constituted 60%+ of the real estate sales each of the last 3 months.  Buying these properties is very different than purchasing a home from a homeowner.  Banks have their own time lines, rules, documents, and requirements.  They can be confusing and lead to enormous frustration if you don’t know what to expect.

Attend this free seminar on March 5 to learn more about how to buy bank-owned properties.  There will be expert mortgage brokers and real estate agents on hand to answer your questions.  Register for the seminar by filling out this quick registration form or call 612-281-5419 for more information.

I have technically three tenants in a SFH [single family house]. Two singles and one married couple. The lease goes until 5/31 and the tenants can’t stand to live together anymore. The two singles want to move out 4/1 and I’m guessing the married couple will also if given the chance. The set of tenants are mixed. Good on taking care of the property but mixed on rent collection paying late most months but always up to date by months end. I’d actually like to get rid of them and get a new tenant in place.

My strategy is to have them sign an early least termination agreement contingent upon my obtaining a new tenant for 4/1 with a signed lease. If I cannot secure a new tenant for a 4/1 move in and their stuff is not out then the original 5/31 lease date stands. My hope is to 1: get rid of the deadbeats and make them happy. 2: They now have an incentive to make things show worthy and make the property available to prospective tenants.

John, I think you are headed down the right path.  I am have zero patience or time for playing mother to bad tenants. I would prefer to just let them go and find someone else.

The positive is that they gave you plenty of notice to figure out a solution and re-rent the property.  I would remind them to keep the place clean and picked up as to help you rent it out by 4/1 (which also is to their benefit to get out early).  Most tenants will be fine with this.  If the property needs any upgrades, you may want to tackle these now (again using your leverage to get them out early to do it).

Unfortunately, I think you are going to have to pick a move out date now.  I would be concerned that if you found a tenant on 3/15, would the existing tenants then have enough time to find something and move out by 4/1?  If one or more of them couldn’t find a place to live, it could get dicey as the new tenant needs to move in and the remaining one(s) now need to be evicted as a hold-over tenant.  This could lead to some sleepless nights and could take 1-2 weeks to resolve.

My other option would be to talk to the married couple seperately (I assume they like living together!).  See if they want to stay and would start a new lease.  I assume since the had roommates, they can’t afford the extra rent, but it is worth a try.  Also, if you have any other vacant units, move one or more tenants over to that one.

I suspect that if you start advertising your rental now, especially in Craig’s list, you will have no trouble getting it filled by 4/1.  Good luck!

I have a tenant whose lease ends 5/31/09 for a SFH [single family house]…When would you start showing the house in order to have it rented for a 6/1 move in? Would you recommend striking a deal with the tenants on keeping the place in show condition or is that usually not a problem?

I try to start as early as possible, but 60 days is about the max that people are looking.  Here are some of my experiences, depending upon the neighborhood:

• The “typical” tenant in some areas will be looking 60+ days in advance.  I see this in South Minneapolis around the lakes.  I also experience this when renting houses   These same tenants will generally arrive at the apartment showing as planned.
• Other neighborhoods seem to thrive on procrastination.  I will get calls less than 30 days in advance, in fact, I will get calls 1 week before they are looking to move in.  I experience this often in both North and NE Minneapolis.  I will book 5 people to look at an apartment and maybe 1 will show up.

As for “striking a deal” with the tenants to keep it clean, I just expect that they keep the place in order.  Also, I work hard to show their place no more than 2-3 times per week to limit them being frustrated.  I book everyone at the same time, just like an open house.

Have you always wanted to buy investment property, but never knew where to start? Don’t Wait! Get Started now.

Clark with the Bourke Group (Keller Williams) in Asheville, NC wrote a fantastic post on How NOT to write a Craigslist For Rent Ad. It is insightful and very well thought through. Every landlord needs to read this!

There are so many examples of interesting tenant screening discussions that I have on a monthly basis.  I thought this one was worthy of posting, not because it was funny, but for some of the subtle red flags, that I was hearing while talking to this prospective tenant.

This prospect called about a 2 bedroom apartment in an investment property in Crystal, that I own.  It was recently renovated and is priced at a below market rent of $765.

Me:
So where do you live now?

Prospect:
I live just down the block in Crystal.

Me:
Great, why are you moving?

Prospect:
The landlord is going into foreclosure and he won’t fix anything and we can get in touch with him.

Me:
How about sending him a letter with your rent?

Prospect:
Oh, we haven’t been paying rent there since March (8 months).

Me:
Really! And no one has contacted you about that.

Prospect:
Nope.

Me:
[Joking] So you should have all kinds of money saved up for the damage deposit and first month’s rent on my apartment, right.

Prospect:
No, I am going to need to get my damage deposit and probably my first month’s rent from emergency assistance.

Me:
OK…………[explained my screening process] Do you have anything on record that I should be concerned with?

Prospect:
Well, I have an eviction from 2 years ago and my credit is bad.

[Thinking to myself-I saw that one coming!]

Informal tenant screening is nothing more than carrying on a conversation with some subtle questioning.  I was just asking questions to understand more about where she lived and worked and such.  As I heard a red flag, I steered the conversation that direction.  While I did this in person, it is a great way to weed out bad tenants on the phone, saving yourself a trip to the property.
Have you always wanted to buy investment property, but never knew where to start? Don’t Wait! Get Started now.

Scott Ficek is a Minnesota Real Estate Agent with RE/MAX Advantage Plus in Minneapolis and helps new and seasoned investors buy and own Minnesota Investment Property. He owns and manages almost 30 investment property units from single family to multi-family. Subscribe to his monthly real estate newsletter. Register for the newsletter here.