I had a recent situation where I picked up a new account and the owner already had a tenant lined up to rent the property. Good news right? Not always. In this case the owner and tenant met at a local church they frequented and agreed to make a deal to mutually benefit each other. The owner was relocating and could not sell property. The property is located in South Natomas and had dropped substantially in value. The prospective tenants had shaky income and poor credit--they also needed a place to live. Perfect match huh? The owner convinced the future tenants to accept the property "as is" for a 12 month lease and be responsible for the following: EVERYTHING. They were to pay the mortgage, water, sewer, garbage, landscaping, MANAGEMENT FEE, LEASE FEE and standard management $300 reserve!
One problem: they hired the manager 30 days before they were to make the move and they did not take my advice to require a deposit, do a background or negotiate the deal. On the move in day the future tenant was to pay all the money at once. They brought in less than 40% of what was agreed to as well as a laundry list of items wrong with the home. Yes, the owners failed to inform the manager they had already given them access to the property to paint and slowly move in.
How many things are wrong with this story? The biggest problem is the lack of money up front in form of a security deposit to secure the property. Now the owner has no funds to use as collateral--or to evict, without coming out of pocket. We as managers see all kinds of story lines unfold in front of us--even with all the warnings in the world some owners just cannot help themselves. Owners, let me help you--contact me anytime.
James Safonov
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