One of the many nightmares in a property manager's day (yes nightmares are possible during the day of a property manager or property owner) is when the rent does not show up. It might even happen when a manager has auto draft from their bank since funds have to be in the bank to collect.
When this happens we suggest the following steps:
1. Call the tenant on the next business day after the rent becomes late. Note: The tenant gets the next business day to pay if the due date falls on a weekend or holiday. Tell the tenant that you have not received the rent and to avoid a 3 Day Notice being served it must be received immediately. Listen to their story but don't make any deals.
2. If you cannot get them on the phone or if you can, serve a 3 Day Notice to Pay Rent or Quit (in California) as soon as you can. See your property manager or attorney if you do not know how to do this.
3. When the notice expires begin an eviction using a local eviction attorney.
4. Drive by the property at least once a week, Monday is a good day, to see if they have vacated.
It is best to be in the drivers seat in this situation. Do not let the tenant be the driver. If the tenant wants to stay, let them sign a stipulation and work out a payment plan. Included in the plan should be a provision for them the pay you back the attorney fees and to admit guilt. In case they default on the stipulation they would be immediately turned over to the sheriff for lockout.
Need more tips? Contact us at www.HomePointe.com
Yesterday Fannie Mae announced a new program it has designed to further assist homeowners facing foreclosure.
The Deed-for-Lease Program (D4L) allows qualifying homeowners to remain in their homes by signing a lease in connection with voluntarily transferring the property deed back to the lender. According to a press release from Fannie Mae, “The new program is designed for borrowers who do not qualify for or have not been able to sustain other loan-workout solutions, such as a modification.
Under Deed for Lease, borrowers transfer their property to the lender by completing a deed in lieu of foreclosure, and then lease back the house at a market rate. To participate in the program, borrowers must live in the home as their primary residence and must be released from any subordinate liens on the property. Tenants of borrowers in this circumstance may also be eligible for leases under the program. Borrowers or tenants interested in a lease must be able to document that the new market rental rate is no more than 31% of their gross income. Leases under the new program may be up to 12 months, with the possibility of term renewal or month-to-month extensions after that period. A Deed for Lease property that is subsequently sold includes an assignment of the lease to the buyer.”
To learn more about D4L please visit www.efanniemae.com. There you will find program details, eligibility requirements, and a helpful FAQ document.
The Sacramento rental market is struggling a bit more than usual. There are fewer rentals available and those that are on the market are not seeing a real strong demand.
Our firm rented out an above average amount of rentals in October which has lowered our overall available properties. It appears the winter will be slow and that usually means the spring will see a rebound.
Vacancy rates are holding at around 5% or lower for single family homes, but don't expect rents to rise anytime soon.
You can access our rental survey at our website: www.HomePointe.com and click on Owner Services.
We have noted that the rental market is pretty soft right now. It is a combination of the soft job market, state furloughs, soft real estate market, lower amounts of foreclosures, and finally, school is in sesson and the holidays are close. In sum, everything is working against a strong rental market right now.
One thing I know, the market in Sacramento has never fallen off the cliff. We have a stable job base in the state, the exception this time being the 10-15% pay cuts for state workers.
The next big event will be the new year. Pent up demand usually makes Janaury a strong month. We will see.
The funny thing is that we are still renting property at a brisk pace. Just at lower prices.
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Property Management Rentals and Maintenance in Sacramento, Yolo, Placer, and El Dorado Counties from offices located in Sacramento, Roseville, and Orangevale, CA We manage residential and commercial.
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