Why Every Landlord Should Charge Rental Application Fees

Why Every Landlord Should Charge Rental Application Fees

Why Every Landlord Should Charge Rental Application Fees

Once thought to be a tool to price-gouge future residents, rental application fees have actually proven their worth. In 2006, Utah’s Rent Control Prohibition Act was amended to add a list of fees that are set by the market and cannot be regulated or prohibited by the local government. To renters and non-landlords, this change could be seen as a potential money grab by landlords and property management companies. However, in the years following the amended act, rental fees have proven to be well worth it. There a variety of reasons landlords should be charging rental application fees. Overall, it is only beneficial for you as a landlord to begin requiring this fee and we have a few simple reasons as to why.

Why Do Apartments Have Application Fees?

The most common reasoning for this type of fee is generally to cover the expense of conducting a thorough background check. This typically includes:

Pulling a credit report

Reviewing any criminal history

Checking the sex offender registry

Conducting financial qualification

Reviewing any rental history

Background checks may not seem that important, but they are actually extremely helpful to landlords and beneficial to renters. When proper and thorough background checks are conducted the result is lower crime rates. Landlords are more likely to conduct these background checks if they charge fees that cover the cost. If renters are hesitant to pay this fee, it’s good business practice to inform them what this payment is going towards and that if they are rejected, it is refundable. The purpose of rental application fees is not to provide additional income to the landlord, but to screen applicants to ensure responsible tenants.

What is the average application fee for an apartment?

How Much is the Average Application Fee for an Apartment?

While this fee varies from state to state, renters can expect to pay anywhere from $30 to $60. As stated earlier, this pricing is determined by the market and is not dictated by the local government. That means this price can and should fluctuate as necessary. However, it’s in a landlord’s best interest to make it well-known to future renters that this fee is typically per renter over the age of 18, and is not a flat fee for everyone who will be living in the home. Being upfront about all upcoming and existing fees is best practice for successfully managing a property.

Why Are Rental Application Fees a Good Idea?

While there are many benefits for charging application fees, we have three top reasons for this extra charge.

Reduce Risk

This is a broad reason that encompasses many things, but it is important. By placing qualified tenants, you reduce the risk of damage to your property and the property of your other tenants. A successful background screening will bring up reasons why you wouldn’t want an individual renting from you. If they have a poor renting history, you can find this out before it’s too late and your property ends up being ruined. With a criminal background check, you can also reduce the risk of anything happening to your other tenants. A simple fee can save you thousands in damages later on down the road and gives you peace of mind from the first day a new tenant starts renting from you.

Reduce Costs

Unfortunately, thorough background checks aren’t free. Requiring one for every prospective tenant can add up very quickly and you’ll be the one footing the bill. Unexpected fees happen in property management, but this is a cost you can prevent. Requiring future renters to pay for their own screening makes running your business more cost-effective and will save you money in the long run.

Deter Unqualified Renters

Sometimes the rental application fee can serve as a qualifying process by itself. This ultimately saves you time by weeding out potential tenants who don’t think they will qualify before they even fill out the application. Not only do you save money, but this also makes you renter screening process more efficient. When you’re upfront with all prospective renters about the fees that will be required, you gain the trust of those who will qualify and give unqualified renters a chance to find another home.

Why do apartments have application fees

Rental Application Fees Are Important and Necessary

So, by now you should see why application fees are critical to successfully managing any property. At Wolfnest, we take care of the screening, fees, and everything else in between for you. This gives you less time to worry about your rental property and more free time to spend with family, take vacations, and pursue other hobbies. We require an application fee for all future renters and look into a variety of other types of criteria such as employment, income, and credit history. Our goal is to keep your rental property or apartment in prime condition with tenants who feel the same way. We want you to get the most from your investment and we’re here to help achieve that goal. At Wolfnest, we take care of all the small details you may not have time to look into and ensure that your property will be well taken care of. So, a great place to start is requiring a rental application fee and finding the perfect renters for your building or home. Learn more about other property management services we provide and contact us today!

Salt Lake City Property Management

Salt Lake City Property Management

Salt Lake City Property Management | Cost & Fees You Should Know About

 

There are many Salt Lake City property management companies, but which one is going to be the most reliable when it comes to developing your property to the fullest potential? Doing all of your own management can be very time consuming, but it all depends on how much time and how many resources a landowner has when it comes to having authority. Only a limited amount of people have the time to manage the paperwork, keep up on repairs, maintenance, and take care of the property. But a majority of property owners don’t have that leisure. That’s where a property management company steps in to take the load off.

Depending on location, professionalism, and costs, doing thorough research on property management companies will guarantee you a reliable management without hidden costs or fees. Fees vary by location, from office to office, as well as what kind of work is being done for the fees charged. For example: advertising and photos are done on a case-by-case basis. If you’re an owner of a rental property, here are some things to research while looking for a property management:

 

Set-up fee

This fee is for the time invested in setting-up a new account. It ranges from 0-$300. Find out if the fee is per unit or per property, and if it makes a difference if the unit is occupied or not.

 

Application fee

Not every landlord or property management company requires an application fee, but it’s a good idea to have one. Application fees typically range from $25-35 per person, and will usually lead to background checking (if they could charge fees to cover the cost). This fee also narrows down future tenants; usually if there’s an application fee, there will be people who can afford it and show interest in the property, AND will pay for an application. This simple fee also lowers crime rates since this charge could go towards screening. During this process, you can also ask the applicants about their income to assure it won’t be a problem when it comes time to pay rent.

 

Management fee

Property management companies usually charge all of first month’s rent or 50% for maintenance and moving in tenants. A new tenant placement fee falls under this first month’s rent as well. After that, 8-10% of monthly income is charged to collect rents, ensure they pay, and inspect property. Fees vary from market to market, but Salt Lake City property management companies usually range from 7-10%.
Finding a property management company is totally up to how much time and resources you have to manage your rental property. If you are an owner and have more questions about Salt Lake City property management, or any management in general from FRE, please contact us.

Property Managers in Salt Lake City

Property Managers in Salt Lake City

Salt Lake City Is the Place to Be!

Home to the 2002 Winter Olympics, a nationally ranked transportation system, and a breath-taking landscape view… It doesn’t get much better than living in Salt Lake City.

 

WHY?

You will have access to hidden gems in the valley that are unique to only Salt Lake City. The downtown scene offers local boutiques and contemporary restaurants such as The Pie Underground, a popular pizzeria located right next to the University of Utah. Grab a slice, then jump into the mountains and enjoy a day of hiking, kayaking, or floating down rivers in the summer sun. During winter time, experience first hand why Salt Lake City holds the title of “the greatest snow on earth”, with world class ski towns such as Park City only 20 minutes away. From the mountains, to downtown, to the airport, everything you need or want to do is accessible within a thirty-minute radius. Property managers in Salt Lake City, such as FRE Property Management, will work with you to find the best location, community, and property available in the Great Salt Lake Valley.

 

Location, location, location!

Nowhere is there a better, more easily navigable community than Salt Lake City. With Temple Square as the reference point, street names are based off how many blocks away (North, South, East, West) it is from Temple Square. Set up as a grid system, further East from Temple Square results in higher numbers on street names, like 300 East (3 blocks East from Temple Square). “On the corner of 300 E and 400 S” then becomes easy to navigate. Simple, right?

In addition to easily finding your way around town, Salt Lake City offers old and modern properties in different locations, depending on your wants and needs. Property managers and owners in Salt Lake care about retaining estates built in the 1900’s–it’s what makes Salt Lake City so unique and charming. With the help of tenants and owners, maintenance and remodeling has kept the buildings in well-conditioned service. From the avenues, to Capitol Hill, to downtown, property managers in Salt Lake City will help you find a permanent or temporary living area that satisfies your requests. If you are an owner, FRE can help you improve the performance of rental properties and your business running smoothly.

 

Let FRE Property Management Help You

Here at FRE, our property managers in Salt Lake City make sure that both owners and tenants are well taken care of. Reasonable maintenance requests are managed in a timely manner, and we work closely with the owners to make sure tenants are happy. FRE provides different ways for tenants and owners to contact us when needed. A 24-hour information line, electronic owner statements, and online payments all help to make service and living easier for you. We chose the industry’s best software provider so that we can offer you the most enhanced features available in the property management industry. At FRE, we care about your rental property and the satisfaction of your tenants. For questions or more information, please contact us.

 

The Cost of an Eviction

The Cost of an Eviction

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If you aren’t a property manager or an experienced land lord, you may want to think twice before you begin an eviction process. Most people believe that it is a fairly simple process and affordable, but what most people don’t know is that it might actually end up costing the owner more money to evict someone rather then try to meet their demands or compromise.

 

There are certain factors when it comes to an eviction, which most people don’t know about. Here are a few examples:

 

1. Lost of rent– Typically you will loose out on two to three months worth of rent during an eviction process, sometimes longer.

 

2. Set up– Even after you get your tenant evicted, you may need to spend anywhere from $500-$2000 to get the place ready for the next renter or tenant.

 

3. Down time– Be prepared to have a lost of  fixed revenue for a period of time. It can vary depending on how well your property manager can sell, but at the very least you can expect to not have a tenant for at least a month… minimum.

 

4. Expensive- You will have to start advertising your property or hire someone to do it. The cost of advertising will come out of your own pocket, and so will the cost of hiring someone if you choose to do so.

 

5. Legal fees– If there are any disputes between you and your tenant, you may find yourself in need of a lawyer, which means more money out of your pocket. The average cost for an eviction case could range any where from $200-$750.

 

6. Court Cost– The cost of going to a court and to file your paper work, or any other legal issue, may range from $100-$300 depending on what you are going to court for.

 

The next time you are thinking about evicting someone, you may want to reconsider the process, because it may end up costing you more to evict someone rather then trying to work it out with them. You also may want to consider hiring a property manager who knows all the in’s and out’s of what to do in the worst-case scenario. For more information, feel free to contact FRE Property Management.

How to Save Money on Landlord Insurance

How to Save Money on Landlord Insurance

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Tips for Saving Money on Landlord Insurance

If you have a tenant who pays you rent, then you need a landlord insurance in place to protect your property. With the proper insurance policy you are covered if anything should go wrong. If you are a landlord you can be held liable for any damages or injuries that occur on your rental properties. Landlord insurance will limit your chances of having to deal with any sort of mishap. Here are some tips that can help Landlords save some money on their insurance:

What the difference between Homeowner’s and Landlord Insurance

 If you believe your homeowner’s insurance will cover your rental property, you are mistaken. Most landlords who turn their homes into rental property are confused with the difference between homeowner’s and landlord insurance. Homeowner insurance usually covers owners who are currently occupying their home. When your home no longer meets those requirements then its considered as a rental property. Which requires you to get a landlord insurance.

Components of a Landlord Insurance Policy

What makes up a landlord insurance, there are several components which make up a landlords insurance policy:

  • Residence are covered for fire, lighting, flooding, burst pipes, and wind
  • Additional structures coverage for garages and outer building
  • Landlord liability insurance

Depending on your policy you may have more extensive coverage than the one listed above.

Saving Money on Landlord Insurance

Landlord insurance isn’t cheap, you can expect to pay 15% to 20% more for a landlord policy than a homeowners insurance. So how can you possibly save some money for landlord insurance policy? First research what companies offer landlord insurance after that ask whether you can receive discounts, on a fire prevention gadgets, multiple properties, or a burglar alarms. This may end up saving you a bit of money.

As a landlord you may qualify for several discounts that includes:

  • New customer discounts for creating a new policy
  • Multi-policy discounts for properties
  • New renovations discounts or upgraded properties

Don’t be shy to ask your insurance agent how you can lower the costs of your policies. Ask about discounts for safety measures, your insurance company may offer a discount for lowering the risk on your property. Some things that you can do to lower your insurance policy:

  • Install an inside sprinkler system
  • Install motion-detector lights and a security system or cameras
  • Install a burglar alarm that is linked to emergency services
  • Installing smoke detectors in the hallway, kitchen, and bedroom for each unit

Not only ask about professional group discounts, also ask if you qualify for a discount membership.

Encourage Tenants to Purchase Rental Insurance

Landlord insurance protects you from losses due to wind and hail, water damage, falling trees, lighting, fire, and injures to your tenants and their guest. However this doesn’t cover the tenant’s household goods, it would be wise to encourage your tenant to purchase a renters policy to cover their items, and make sure that they understand the policy.

Don’t Over File Claims

There is a limit for how many claims you may file before your insurance company starts charging you more. So make your claims count there are certain situations where you would want to file a claim, for example when a person alleges they were injured on your property, water damages or mold damages to the properties. These are some of the cases that you would want to file for a claim.

 

 

Security Deposit Tips for Landlords and Property Managers

Security Deposit Tips for Landlords and Property Managers

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Security Deposit Tips for Landlords and Property Managers

 

There are some things that property managers can do in order to avoid any complications when it comes to security deposit. Here are some simple tips that can help you avoid any complications when it comes to security deposit.

 

1. Know your state laws

 

As a property manager or landlord, you need to how much your state law allows you to collect, how quickly does it need to be deposited into a bank, are there required reports, if there will be interest – how should it be paid and so on. These are important things to understand when becoming a property manager. It is also important to understand that the security deposits for residential property falls under a statute and calls for a nondiscriminatory and equal treatment. This prohibits any kind of discriminatory practices.

 

2. Charge the right amount

 

Don’t be tempted to charge less for a security deposit, which you are entitled to. It might seem easier to have a lower amount in order to attract more tenants, but you might run into risks and problems down the road. You should always consider what your house is worth and consider who your tenants might be. Setting the right amount of security deposit will not only help pay for any damages that may occur to the property but it can also weed out the financially unstable tenants. That way you will get a tenant that you will want to let live in the rental property. The right amount can also help prevent a tenant from moving out unannounced.

 

3. Security deposit

 

Security deposits are not extra rent and you shouldn’t treat them as such. Those deposits have to be returned to the departing tenant assuming there is no damage to the unit.

 

4.  Establish trust accounts

 

Make sure you establish a trust or escrow account for the security deposit. Make sure your bank knows that the deposits account is for security deposits only. This is to help prevent any forfeiture of those funds being accidentally spent on your behalf.

 

5. Don’t Mix the Account

 

Make sure you keep security deposit trust account separate from your own, even though some state laws allow you to mix it with rents or turn it over to the rental owners. Try not to mix up the account because it is far too easy to accidentally spend the security funds.

 

6. Handling escrow money

 

Even though you have a broker’s license for many years and you can legally handle escrow money like security deposit, doesn’t mean that you should. Get trained or hire a professional who is an expert with escrow funding’s.

 

7. Let your property owners know

 

Make sure to keep the property manager in the loop with what you expect out of them. Take proper steps to ensure that your property manager understand the procedures and policies on handling security deposits. Along with that, make sure that the property manager understands what his or her are task and that they are to be completed. Don’t let his or her negligence cost you a tenant or lawsuit.

 

 

 

 

6 Things to Look For in a Property Manager

6 Things to Look For in a Property Manager

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1. Hire a licensed property management company

Sounds like a simple thing but a lot of people don’t check to see if the person they want to hire have a license or not. The first thing that they look for is whether or not the property manager is affordable and their personality. Sometimes it is a good thing to pay a little extra in order to have a licensed property manager, because they will know how to take care of all the paperwork as well as any unforeseen complications.

2. Look at the managers portfolio

Take a look at some of their current managed properties, ask for the addresses of a few locations, which are currently being managed by them. After reviewing the conditions of the property, which they are managing you can start to eliminate some of those candidates.

3. Is the fee reasonable?

There is no such thing as a standard management fee, it all depends on your market area, however you can expect to see fee ranging from 8-10% of the monthly rent amount as the management fee.

4. Will your property be inspected?

 Make sure that your investment is being taken care of properly by being check inside and out. If you have a long-term tenant it is still important to check on the condition of the home, that way you can head off any major problems that the tenant hasn’t reported or noticed.

5. Interview your candidate

You should review all of your candidates and ask questions like how many times have you evicted someone on their current property. A high rate eviction can tell you that they aren’t screening the rental applications well enough.  Renters should be expected to pass the basic credit check and have a satisfactory reference from the previous landlord.

6. Review the contract

Have a well written agreement that includes a termination clause. If you are unhappy with the property manager you should a pre-defined method for ending that relationship. Perhaps consider providing a 30 day written notice with the company or person about your concerns and dissatisfaction.

The most important thing to remember is that you are satisfied with your property manager and that they are easily accessible.

Things to Consider Before Renting Out Your Property

Things to Consider Before Renting Out Your Property

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Things to Consider Before Renting Out Your Property

So you have considered renting out your house, in order to obtain an extra steady amount of monthly cash flow, but have you thought about the other factors that it may come with? So before you decided whether or not to turn your house into a rental property here are some things to consider.

Good Tenants Don’t Come Easily

Finding a good tenant could be a long waiting game, because you don’t just want any tenant you want a good one: who will not only take care of your house, is easily manageable, and will pay rent on time. To create these kinds of exposure, you will most likely use some kind of out source services that will put your listing on the front page, but there will be a monthly fee until your house has become occupied or for however long you decided to continue listing.

Difficult Tenants

A person can be well mannered, looks normal, and has a steady job, but for many unassuming landlord they might become your worst nightmare. It is best to do some further investigation on whether or not you want that person to occupy your house. There are some basic procedures that you can do to avoid any future losses. Request for a referee or perhaps a former landlord’s testimonial, you could also Google the person of interest to get some background information.

What to Include in your Lease

Tenancy agreements are quite standard and follow a general template but keep in mind that it is still your house and your are entitled to adjust your terms and condition accordingly. Besides the guidelines for paying rent, you may want to consider some of the following; general conducts, alterations to the property, proper use of plumbing fixtures, parking ethics, pets, guest, maintenance, and expected conditions upon moving out.

Cost for Maintenance Work

Normal wear and tears are bound to happen no matter what kind of tenant you may have, regardless of the tenant. There will be some kind of upkeep or maintenance that you will be required to do, but your tenant might not share the same thoughts and would like to go a different route on how to fix then. If their case and demands are reasonable then you must meet their request, which might cost you more than what you originally wanted to spend.

These are just a few things that you should think about before considering renting out your property, but why not save yourself from all the headache and hassle that come from managing a property? Why not talk to a real estate agent or property manager about your situation, and let them take care of all these things.

How to Avoid Home Rental Scammers

How to Avoid Home Rental Scammers

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Avoid Home Rental Scammers

Moving to a new city can be a life changing moment for most people. It is important to know how to avoid scams when looking for a new apartment, in an area that you are unfamiliar with. Here are something’s to be aware of in order to help you avoid those scams.

There are a lot of scammers that take and use a real listing from, a real home rental or real estates and claim it as their own, they will take these already written listings and make a few modification, by changing the email address or other contact information to include their own information. They might even use the same name as the original poster and only change the picture and contact information, just to confuse you.

The best sign that the listing is a scam is if they request you to wire money over. There is no reason for you to wire money over, not matter what the reason may be. Some reasons could be paying a security deposit, vacation rental, or application fee, there is never a good enough reason to wire money, because once the money is wired there is no way for you to get that back. So beware if a listing for a rental home is asking you to wire some money for a security deposit, or application fee it is most likely a scam.

Another thing to always remember is, if the deal is too good to be true then it probably is. Most scammers will take all of the real information for a home rental listing, but list the price below the average rental rate in the market, that is an easy sign tell whether or not the listing could be a possible scam.

These are some of the basic things that you must look out for when looking for to a home rental, the best way to avoid these kinds of mishap is to hire a real estate agent, and discuss your concerns with them. If you choose to continue the search by your self always be aware that if they ask you to wire money, that is a safe assumption that the listing is a scam, and remember that if they deal is too good to be true, then it probably is.

Ten Tips for Landlords

Ten Tips for Landlords

Ten Tips for Landlords

Here are a few tips that landlords or property managers need to be aware of before renting out their property to a tenant.

1. Screen tenants

One of the most important things you can do before renting out your property is to screen the applicant. Don’t rent to anyone before checking for reference, credit history, and background don’t be afraid to get in-depth with the questions, remember this is your property that you are renting out and you want to make sure it’s in good hands.

2.Handle security deposits properly

Right off the start establish a fair system with your tenants on how you will be collecting, holding, and returning the security deposits. Make sure to inspect and documents the condition of the rental unit before the tenant moves in, to avoid any dispute of the security deposits when the tenant moves out. Always make sure that the tenant understands all the conditions in order to obtain the security deposit.

3.Get it in writing

Make sure you use a written lease or month-to-month agreement in writing no matter what kind of relationship you have with that person. Some of the things you should include in your written documents are when and how you handle tenant complaints and repair problems, when the rent will due and if there will be late penalties.

4. Provide secure premises

Don’t let your property or tenant become an easy target for a criminal offense. Keep your property’s security up to date and take responsible steps in protecting it. Most often the best practices to keep your tenant and property safe are fairly simple, just have some proper lighting and trim the landscape, which are not that expensive and can greatly increase your security from criminals.

5. Make repairs

One of the main issues that some tenant and landlords has is staying on top of maintenance and repair when needed or when requested. Make sure you don’t let this happen to you always stay on top of maintenance and repair, if the property is not keep up to date or in good condition the tenant may gain the right to withhold rent. There are other issues that may occur due to lack of maintenance for example a lawsuit due to injuries caused by defective conditions.

6. Provide notice before entering

An important thing to keep in mind, is respect your tenants right. You should notify your tenant before entering the rental unit, and provide as much notice as possible, preferable at least 24 hours.

7. Oversee managers

If you have chosen to hire a manager to oversee your rental unit make sure you have done a full background check on the individual. Make sure to supervise your property manger, because if they were to commit a criminal offense or are incompetent, you may be held financially responsible and not the property manager, do an in-depth background check and list out all the manager’s specific duties to help prevent any kind of problem.

8. Disclose environmental hazards

If there are any kind of hazards such as mold or lead on the property, tell your tenants immediately. More landlords are being held responsible for the tenant’s health due to these toxic environmental exposures. To avoid these kinds of action make sure to upkeep your property, but if this case does occur make sure you inform your tenants right away.

9. Resolve disputes

Always try to work out any kind of disputes with the tenant without involving a lawyer if possible. If you have a dispute with the tenant over deposits, rent, repairs, your access to the building, noise complaints, or any other issue that doesn’t constitute for an immediately warrant eviction, try meeting with your tenant to see if you may resolve the problem together rather than hiring a third party.

10. Obtain insurance

Be sure to purchase enough liability and property insurance, in case any unforeseen accidents were to occur. A well design insurance plan can protect you from lawsuits by tenants for discrimination or injuries as well as losses for your rental property such as fire and storms to burglary and vandalism. With the proper insurance plan you can protect yourself from all these kinds of mishap.