Landlord / Rental info

[Karl Hungus]

I just bought a house in lovely (puke) Del Rio. I'm gonna rent out two of the rooms to some buds of mine who will be going through UPT at more or less the same time. I'm just looking for advice from any people that have done similar things before- Did you have them sign a lease, or just trust them to make payments/ stick to their word? Do I need to involve the base housing people or legal? What happens if I have them sign a formal lease and then one decides to go helos and needs to get out of it? Obviously no problemo from my point of view, but am I opening up a world of hurt from a legal perspective? Any and all advice is appreciated.

[M2]

Not a lawyer, but I would expect the housing office to have all the answers to your questions. First of all, you would be a moron not to have some legal document drawn up concerning the agreement. They may be buds now, but when they destroy your house and scoot you will have no legal recourse without a lease. And make them give you a deposit. And of course you will have to give them the same options under the Servicemembers Civil Relief Act as any other landlord, which includes cutting them loose from a lease if there is a military reason for it.

If you are considering renting the property out after you leave, I would strongly recommend getting a property manager. It costs you a little, but the peace of mind is worth it. And the 10-year rule applies as a military homeowner. You have a ten-year extension to the "live in the property for three of the past five years" law when it comes to paying capital gains if/when you sell. So, in other words, if in 12 years you decide to sell, the clock backs up to ten years prior and if you lived in the property for three of the previous years prior to that date, you do not have to pay any capital gains on the profit of the sale. The tax folks will be able to tell you more about it.

Just some lessons learned from owning and renting out two properties during the second half of my career...

Cheers! M2

[pawnman]

You could talk to legal. I would just type up a lease agreement in Word, print it out, and have everyone sign it, just in case. It probably won't be a problem, but you never know. As for a dude going helos, you wouldn't hold him to the agreement if he's moving out, right? Just find yourself a new roommate. Happens all the time.

[Karl Hungus]

You could talk to legal. I would just type up a lease agreement in Word, print it out, and have everyone sign it, just in case. It probably won't be a problem, but you never know. As for a dude going helos, you wouldn't hold him to the agreement if he's moving out, right? Just find yourself a new roommate. Happens all the time.

Thanks for the advice M2 and pawnman. I'll def be writing up a lease and whatnot... and no, I wouldn't hold anyone against the lease for a legit military reason, or any reason I guess as long as I had enough notification in advance. My buddy doesn't want to have to sign the lease, keeps claiming that he's good for it. I know he is, but still... you never know. Just interested in suggestions from people who have BTDT.... didn't know about the capital gains tax stuff, I'll be sure to look into it.

[SPiF]

Having spent some time working in the Texas court system, and doing research over the times...

there's a blank lease out there that is essentially a boilerplate lease, the TAA has a version for apartments, but it'll work for a house too. I'd make anyone not family (and even some of my family members) sign a lease. In Texas, without a lease, you're very limited when it comes to forcing them out (if it came to that), collecting for damages, etc. You wouldn't even be able to evict them, or force them to move out. Ask all the hotels that gave rooms to Katrina victims, then had to pay them to leave 'cause there was no lease, so the courts wouldn't help.

But Base Legal should be able to get you a copy of a blank lease, and go from there. FWIW.

[pawnman]

Thanks for the advice M2 and pawnman. I'll def be writing up a lease and whatnot... and no, I wouldn't hold anyone against the lease for a legit military reason, or any reason I guess as long as I had enough notification in advance. My buddy doesn't want to have to sign the lease, keeps claiming that he's good for it. I know he is, but still... you never know. Just interested in suggestions from people who have BTDT.... didn't know about the capital gains tax stuff, I'll be sure to look into it.

Tell your buddy tough luck. You're only trying to protect yourself. If he's that against it, and he's really a good friend, get his input on writing up the lease.

[The Kayla]

I'm late on this:

Friend or not, make him sign a lease.

We learned this the hard way. We screwed ourselves, because we were trying to be "good friends"..

Here's the story:

We had a roommate before my husband left for OTS, a really good friend of ours. stayed in the house while he was at OTS (even though I have three huge dogs, I'm still a chicken sh!t). Roomie and I talked about rent, and what would happen if he couldn't find some one to share the rent with.. he said that he would tell his dad, and everything would be taken care of(his dad paid for all his bills...). Well, we never made him sign a lease. Not even one week after I PCSed to Vance, my Husband was at ASBC, Roomie calls my husband and says "Hey, I can't find anyone to help me with rent.. I'll be out by the end of this month."

As some one who has BTDT, we learned our lesson.. it doesn't matter if it's family or friends or strangers.. ALWAYS sign a lease... It will cover your ass...

It sucks to have to be a bad guy, but honestly, your ass on the line if he bails out on you, not his.

Edited July 13, 2007 by Kayla

[Herk Driver]

I'll add my $.02. Rented my house out to a friend from UPT when I PCS'd overseas back around '00. Had him sign a lease. Never had any problems. We got the boilerplate lease from JAG and added a few specific items that we both agreed to. When you are a landlord, and make no mistake when you rent out a room or the whole house, you are a landlord, you have to have the paperwork there to cover youself.

If you've ever done business with family and been screwed, you'll know what I mean when I say this. The worst business partners are usually family, but friends come in a close second. Sometimes family and friends try to levergae your relationship to their advantage. If you're buddy doesn't want to sign the lease then tell him to find somewhere else to live. The lease protects him just as much as you.

[M2]

And even with a lease you have restrictions of what you can do. My BTDT story concerns a guy who was in the construction trade renting one of our condos outside of Baltimore. One bad winter he couldn't find work, hence he didn't pay rent. My property manager got an eviction order, but it takes a while for the police to serve it. When they finally got around to it, it snowed. Apparantly Maryland law prohibits evictions if it is snowing, so they canx'd on me. The dude got to live there for several more months rent-free before we finally got him out. Tried several avenues to get him to pay back rent, and did get some (about a third) back; but for the most part all I got to do was write it off on my taxes.

Friend or not, I wouldn't let anyone live in one of my properties without a formal, legal agreement. If he doesn't like it, tought shit, good luck to him in finding someplace to live that doesn't require a lease...

Cheers! M2

[Boxhead]

I agree with everyone else here...if you own, and someone else is going to live with you, make them sign a lease, or assume you are paying all the bills. And if that is case, you better be having sex with them on a regular basis.

Since I would hope you are not having hot man love with your tenants, have them sign a lease. If they get helos or T-44s, the Military Clause you should have on their lease will release them just fine. No problems. Problems only occur with no lease.

SOOO...Lease=Good. No Lease=Bad.

[M2]

If they get helos or T-44s, the Military Clause you should have on their lease will release them just fine.

No need for a military clause in the lease, the Servicemembers Civil Relief Act already has that covered. It doesn't have to be actuallywritten in the lease for it to apply...

Cheers! M2

p.s. Like the new waving flag icon!

[Zippy]

I recommend making them get renters insurance prior to moving in (put it in the lease as a stipulation if you have to). Also I encourage you to increase your liability coverage on your homeowners policy if you are going to have renters.

[Guest sleepy]

I recommend making them get renters insurance prior to moving in (put it in the lease as a stipulation if you have to). Also I encourage you to increase your liability coverage on your homeowners policy if you are going to have renters.

What is the difference/benefit of doing this over just having a "fire policy?" That is what I was told most landlords get on their property, but I also know very little about the insurance business.

I will say that paying a property manager 10% of the rent every month is the best money I spend each month.

[M2]

I recommend making them get renters insurance prior to moving in (put it in the lease as a stipulation if you have to). Also I encourage you to increase your liability coverage on your homeowners policy if you are going to have renters.

What is the difference/benefit of doing this over just having a "fire policy?" That is what I was told most landlords get on their property, but I also know very little about the insurance business.

I will say that paying a property manager 10% of the rent every month is the best money I spend each month.

I am no insurance expert, nor did I stay at a Holiday Inn Express last night; but if I understand it correctly renter's insurance only covers the contents of the property. Basically, the renter's stuff. As the property owner/landlord you need insurance on the property itself. It also covers you if someone, say a repairman, came to the property and injured themselves. Or if they people upstairs have a water leak and damage is done to your property. A "fire policy" is too restrictive, and wouldn't cover those situations or others such as flood, hurricane, tornado, etc.

That being said, I have always believed in having good (read: a lot of) insurance coverage. The few times I haven't, such as having only comprehensive on an old car that was paid off, it has bit me in the ass. Know your policies and talk with your insurance company. Good ones like USAA will be more than happy to walk you through the different coverages.

And I concur with the property manager recommendation. A good one is a major stress-reliever. Unfortunately, a bad one can add stresss as we have found out the hard way...

Cheers! M2

[MilitaryToFinance]

Bringing a thread back from the dead here since it is kind of close to what I wanted to ask. How many people on here actually own as opposed to rent? And if you do own have you subleased a room in your house? I'm looking to buy a place when I get out to Peterson. I figured out that my BAH will pretty much cover my mortgage+interest. So I'll pay HOA dues and utilities out of pocket. It sucks but its not too bad and not all that much more than renting from what I've been told. My biggest debate is having a roommate. It would be very nice to have somebody else's BAH paying my mortgage for me but after living in a fraternity house 2 years and now in a house with 4 people I'm ready for my own space. I guess it will be a matter of if my greed outweighs my desire to have extra space. I'm sure the fact that I'm a 63A and not in Ops makes a bit of a difference in whether you own or rent. Obviously in pilot training and such it wouldn't make much sense to buy for just a year or so at one location but after that how many bought a house?

[sputnik]

Bringing a thread back from the dead here since it is kind of close to what I wanted to ask. How many people on here actually own as opposed to rent? And if you do own have you subleased a room in your house? I'm looking to buy a place when I get out to Peterson. I figured out that my BAH will pretty much cover my mortgage+interest. So I'll pay HOA dues and utilities out of pocket. It sucks but its not too bad and not all that much more than renting from what I've been told. My biggest debate is having a roommate. It would be very nice to have somebody else's BAH paying my mortgage for me but after living in a fraternity house 2 years and now in a house with 4 people I'm ready for my own space. I guess it will be a matter of if my greed outweighs my desire to have extra space. I'm sure the fact that I'm a 63A and not in Ops makes a bit of a difference in whether you own or rent. Obviously in pilot training and such it wouldn't make much sense to buy for just a year or so at one location but after that how many bought a house?

Rent to pilots if you can. Not because they're better people (we are) but you're more likely to get a roommate who is always/often gone, which is huge. You get the rent with half the roommate.

For myself, I bought as a FAIP. I put guys up on temp basis when PCS'ing, but in general I determined I liked my own space. I didn't dig Del Rio all that much, but I really liked my house, and having it to myself made up for Del Rio a little. Financially...having a roommate would have been huge.

[addict]

mappleby - I take it you're single.

Don't be cheap and try to base the rent on BAH. Base it on being a damn good deal, because it is weird for someone to live with their landlord.

Edited June 12, 2008 by addict

[MilitaryToFinance]

I wasn't actually basing the rent on what the local BAH is I was just looking at being competitive with rentals rates. Just giving the area I would probably be renting to other military people so however much I charge it would be their BAH that was helping pay my mortgage. That was all I meant by that statement.

[abmwaldo]

I've decided to take the plunge and rent out my "apartment style condo" while I'm deployed for the next several months. I'm sure many of you have done the same with previous houses, condos, etc...

Does anyone have a specific website they use in order to "screen" applicants? (Credit/rental history, criminal record, etc...)

Any words of advice for a (about to be) new landlord?

[Tone deaf]

Most people who have never been landlords underestimate the difficulties they will likely experience. My advice is to VERY carefully screen potential tenants, as bad tenants are like bad spouses...you will wind up much worse off than if you never had them in the first place. There's lots of resources out there for info... here's one that has some good stuff, even though it is designed around Florida laws, there is a lot of good general landlord information that is applicable anywhere. Good luck.

Florida Landlord

[Toro]

Does anyone have a specific website they use in order to "screen" applicants? (Credit/rental history, criminal record, etc...)

We use AHRN. It doesn't screen applicants, but it's DoD sponsored for use by military families, so you've got a bit of built-in protection. It's also nice in the sense that you register your rank and PCS dates and location, so it can use those to search for houses in your area or check your potential renters. It will also determine BAH based off rank.

[JeepGuyC17]

Sorry if this has been discussed elsewhere, couldn't find anything with search, but does anybody have any experience with a good property manager in the Charleston SC area?

[ClearedHot]

Sorry if this has been discussed elsewhere, couldn't find anything with search, but does anybody have any experience with a good property manager in the Charleston SC area?

PM Sent

[BFM this]

I thought that we had a rental thread, but a brief search turned up zilch. (Mods: little help if I missed it.)

So I am about to get rid of a problem tenant in San Antonio. For the most part, I am just happy that he is gone. But the thought that is nagging at me is that I really should put the data of his conduct out there. Obviously, he owes me money. Not a lot, but enough. Has anyone worked with a collection agency? I'm not expecting to see a dime, but what concerns me is that he is in a military town, and I got a snippet of data that the new place he is about to move into is owned by another military member. I wish there was some way that I would waive that deal off, but at least I can put his bad dealings on file with the credit bureaus.

Anyone had to deal with a bad tenant before? Any pointers? I'm specifically looking for insight into the collections and credit reporting processes.

[Flaco]

https://www.rentrecoveryservice.com/

https://www.tenantcollection.com/processing_fee.htm

https://www.mrlandlord.com/html/resreport_intro.html

You can also take them to small claims court and get a judgement, but good luck collecting. They will have an outstanding judgement that shows up in the court records that will indicate what kind of tenant they are. That should be enough to put future landlords on notice.