The last few weeks have been pretty bust for me.  In my personal life I have been swamped.  I was literally going from 8am through until just past midnight Saturday and then back out at 8am on Sunday and got home around 6pm.  A very long weekend and when you add in that I was tossing and turning all night Saturday into Sunday I am exhausted.  Anyway, on to some updates.  The house has been rented.  The tenants are a couple moving to a larger place from a studio apartment they have in the city.

     They seem like nice people, so they passed the "gut" test.  For the rental criteria, they passed everything.  Financials were OK, current landlord for one gave a great reference. 

     The guy currently splits time between his parent’s house and his girlfriend.  She has a loft apartment which makes it a tight fit for them both to live there.  His financials were good, everything on credit looked good.  I wasn’t able to get a hold of his previous landlord from another state.  That was something that gave me cause to give a second thought.

     For the lady, she was OK with her financials.  No recent delinquencies.  Not a great credit score but an OK score.  Current landlord gave a good recommendation.  Pays on time, no issues at all.  The current landlord and I got into a conversation about how there aren’t many landlords now that call and check references.  It’s refreshing to talk to someone else who does.  The previous landlord gave a mediocre recommendation.  She said that the place was kept nice, rent was paid on time and they even gave a full refund of the security deposit.  The issue that she had was the tenant was in a tumultuous relationship and this caused social issues (arguments, etc).  I’m not sure if this is the current relationship she is in now.  I didn’t really get the opportunity to bring it up in conversation and I really wasn’t that concerned with relationship arguments.  Both candidates qualified for the place independent of each other so if there is a split, it should be OK.

     Either way, the place is rented and I am back to full capacity.  It’s nice to see the bank account for the rental business growing instead of shrinking.
 

      There were some repairs that they had done such as a new bedroom door.  I was told that one of the tenants put their hand through the door because it had been sticking.  Either way, the new door is nice.  Unfortunately there are issues.  First, the casing around the door was damaged when they went to replace it.  Second, when they were removing the old door it looks like a chunk of the header was ripped off.  Nothing that would be structural to repair, but definitely cosmetic as the all the wood is stained and not painted.

      2 areas of rug had to be steam cleaned, the back bedroom and the upstairs hall.  The movers put a decent sized ding in the ceiling that needed repairing, etc.  The bulk of the items were small.

      One big issue I had was with holes in the wall from nails.  They were proactive in that they attempted to fill the holes.  Doing the final inspection I saw that the repairs needed to be sanded and I could have filled it better myself so it would not have needed sanding but they get an A for effort.  Long story short the A turned to an F when I went to sand the stuff.  Whatever they used never cured.  It remained pliable like chewing gum.  I ended up digging all the stuff out of the holes, sanding what was stuck on the walls with my orbital sander then refilling the holes.  What would have been a 20 minutes job if they left the holes turned into about 3 hours.  Not fun.

      The other big item I have had trouble with was deodorizing for a cat.  I know, I normally have a no pets policy.  This tenant was good and worth it that I decided to take the chance on pets.  The cat apparently liked the storage room…a lot.  It became the litter box from the smell of it.  Anyway, I have had success in the past with Odorcide 210 for pet odor removal.  One treatment didn’t get rid of the odor so I gave it another shot.  I’ll be heading back today to see how the smell is.

      All in all I ended up with more damages that I expected.  I am sure they will also be surprised by the number of charges on there.

The tenants gave notice they were moving and left at the end of February.  I had 1 day of showings for the property where I had 3 prospective groups come through.  Of those 1 wanted to "cut a deal" to do work for reduced rent.  He had a valid business but I’d be breaking my own rules to accept work done for reduced rent.  Especially since his landlord reference was also his boss, who was also his Uncle.  You can see where all the eggs are in one basket and that basket is biased.

The second and third sets of prospective tenants were nice but each had their own issues that caused me to reject them.  I can deal with low credit scores but when someone goes below 525 I just think "Wow".  In addition to the low scores both of these groups had addresses that didn’t match up to the credit reports.  Lastly, one of the applicants from the groups was someone who was 40+ and the only thing on his credit report, at all, was 1 parking ticket which was not paid.  There were’t even any inquiries for credit listed on the report at all.  The addresses he provided didn’t match to his credit report, just too much which seemed off.

The hunt continues for a good quality tenant.

    An update.  I have a bunch of information to continue the "Honest Company or Scammers" article.  I haven't had the time to assemble all the different pieces together to form an article, possibly two, from the information.  This is really taking shape.  

    Update on Condo #1, I received a call last week to let me know that the rent was going to be late.  In case anyone forgot this is the guy who has been with me for years and has a history of good payment with me.  I know he is going through a rough patch at the moment and want to cut him some slack.  I let a late payment fee go last month, but this month it will be enforced.  Paymnet shoul dbe received in about two weeks

    Update on House #1, I received the rent check in the mail on time.  It has been deposited but i won't know if it clears or not because I used Netbank.com and all their deposits were just acquired by ING direct.  Because of this ATM deposits are no longer accepted.  Between the federal holiday and the mail, I won't know if the check is good for about 1.5 to 2 weeks.

    I haven't had much time for life, let alone investing.  I'm behind on the news, blogs, you name it.  I can't wait until things die down a bit to give me some time for my enjoyment.

til then….

      September will also bring in the first full month's rent payment due from house #1.  Up to this point there was the pro-rated month's payment due for moving in early and the first full month's rent was included with the security deposit.  Hopefully that will come in on time and all will be good….until the next problem of course.

     With as crazy as my traveling schedule has been I need the properties to be problem free for another month or so.  After that I should have some time to dedicate to them should they need attention.

web log for us – those that realize that "passive income" isn't always so passive 

    Sorry I've been away for so long.  My full time career has been getting in the way of my blogging.  We're up for another re-compete of many positions we have filled around the United States and I've been working on seeing how they are going and writing proposals as needed.  I pulled an all-niter finishing one proposal only to hear of another that should be coming through sometime today.  I needed a stress release so I took a few minutes to browse the Internet, catch up on some news articles I've been putting off reading and figured I should update everyone on what is going on.

    In addition to the re-compete I've been traveling quite a bit lately to prep the customers for what was coming.   I wanted to prepare them and do everything I could to help out before the positions were actually advertised.  Once they are advertised I am no longer allowed to speak to the decision makers.  These are government contracts and I would end up disqualifying my company from the work if I were to have any questionable contact with the decision makers.  It looks like I'll be spending about 2 weeks on the West Coast next month.  Heres to some good weather!

New Tenant in House #1: 

    The new tenant is working out well.  He's honest and keeps me informed of things that go wrong.  For example, while moving in he was backing his car up with the trunk open and hit the outdoor light that is next to the back door.  It ended up cracking the base where the light attached to the metal plate that is affixed to the stone wall.  He wired it up so that you can't tell it was damaged unless you get very close to it.  Actually I had driven past the property twice and never noticed it until he pointed it out to me.  He said he'll fix it and I'll give him a couple more weeks to get it done.  If it is still broken by the time fall comes, I'll go out and buy a new fixture and replace it.  I'll forward the bill for the fixture over to him.  If the fixture was old I probably just let it slide and replace it free of charge but the fixture is about 3 years old.

Existing Tenant in Condo #1:

    I never received the rent from my existing tenant in Condo #1 for August.  This was the first month that the increased rent was due.  The rent increase was just about 5%.  I know he works split shifts and ends up sleeping odd hours.  I've been keeping crazy hours with my travel and proposals so I typed a letter out to him one night and sent it off explaining that I hadn't received the rent payment yet.  I let him know what my schedule was like and that I didn't call because I didn't want to wake him in the middle of his sleep since I know he keeps off hours for work.  I explained what the amount due was and what the late charge was.  I asked him to let me know if the payment was lost in the mail so we could work something out.  The letter was sent out last Wednesday I believe so he should have gotten it by Friday.  

    This tenant has been with me for just about 3 years and has always paid his rent, occasionally falling behind, but catching up quickly  He usually lets me know when he's running behind so this is an unusual circumstance.  The rent is still well below market value for the area which is OK with me because he is a great tenant.  Pair the lack of communication with the fact that this month was the first with a rent increase and it gets me thinking. If I don't get a check by Friday or at least some type of response I'll call on Saturday and pop over with a Pay or Quit notice.  I'll keep you updated.

CISSP Examination:

    Well, the CISSP examination was quite an ordeal and I wasn't sure if I passed.  Turns out I just missed passing.  I received a score of 689 in the CISSP certification test.  700 is the minimum score required for obtaining your CISSP certification.  Coincidentally another person in the class received a 689 also.  I think that is just plain weird.  I've tried doing some research to see if a 689 in the CISSP exam actually means something like I passed the test overall but failed one section but I haven't been able to find anything.   Even though the entire class exchanged emails and a ew of us sent our results out for all to see, only a handful shared the results.  out of the 8 of us that shared the results, 6 passed.  that's a 25% failure rate which actually works out to the percentage of the class that was there the 2nd time taking the test.  Interesting statistic. 

    I want to take the certification test again before I lose too much of this knowledge.  I was planning for the end of September to re-take my CISSP test but that doesn't look like it's going to happen.  With the plan of being on the West Coast for 2 weeks and a mini vacation scheduled in there the second week of September I am booked up.  One good thing though is that I'll be able to get a decent amount of studying done while I am on travel.  There's 4 6 hours plane rides plus the evenings are open while I am away.  No dinner to cook, no family to be responsible for, it could turn out to be a blessing in disguise being away for 2 weeks.  My CISSP certification pursuit continues….

web log for us – those that can multi task…and succeed

    I met him and gave him the keys.  I also gave him a bill for the early move in for 18 days of rent.  The formula I use to pro-rate rental payments is:

• Monthly Rate * 12 = Yearly Rate
• Yearly Rate\365 = Daily Rate
• Daily Rate * number of days = Balance

    Anyway, all went well and since he had paid the first month's rent prior to moving in I told him he had 30 days to pay the partial month.  I was pleasantly surprised when I returned from my CISSP Boot Camp to find a check in the mail.  

    The check was for more than he owed to me.  He called me after I returned to say he lost the paperwork that listed how much I owed him but he believed the check he wrote covered it.  Needless to say he owes me $57.00 less for September's rent as he overpaid for the 18 extra days.

web log for us – those that look for the best tenants possible for their properties

    Let me give a slight description of one part of the house before I get into the tale.  The previous family that lived there had an elderly woman who had a hard time walking up the steps.  This was why they eventually moved.  To help her traverse the steps, there was a wrought iron railing installed on the left wall of the steps.  The rest of the railings were changed tso everything matched.  There is a wrought iron railing on the right side that goes up the steps.  There is also a small landing at the bottom of the steps where there is a turn.  There is a wrought iron set of railings that closes this off and goes down the 3 steps into the living room.

    I get a call that the movers are having a hard time moving an armoire up the steps.  Does the landing railing come off?  Now everything that goes on can come off  but I don't trust movers to be the ones to take of or put something back on correctly.  They aren't contractors….man that was a loaded statement.  Theres a bunch of contractors i wouldn't trust that with with either….but that's a different post.

    I explain that I don't think it does without causing damage.  The tenant explains that he needs to get it off and will pay to get a contractor back in to replace it if he needs to.  I am totally out of the loop as I am about 2.5 hours away at this point in Hershey Park.

    He calls me back about 20 minutes later to let me know that the railing indeed does come off.  It bolts into the floor under the rug and that they had to cut and pull part of the rug away to get to it.  He says that he will get it repaired.  He called because he thought he might have freaked me out with the previous phone call.  He read me well on that one.

    I see two things here.  First, on move out day there is going to be a repair to the rug that needs to be done.  Even if he fixes it now to live in the place, he may not when he leaves as the railing will need to be removed to take the armoire out.  Second thing is that he did call me to check and to try and alleviate my fears.  That's more than most tenants would do.  Needless to say that I will be popping by shortly to see how things are.  My trip to the CISSP training class is getting in the way of me visiting this week.

web log for us – those that trust but verify 

Condo #1 – This is a 2 bedroom, 2 bathroom unit located in Northeast Philly.  It's approximately 820 sq. feet.  Tenant is responsible for all utilities except water.  Water is included in the condo fees.  The unit has forced air heat and central air conditioning.  I provide a dish washer, refrigerator, clothes washer and clothes dryer.  The tenant in this unit has been there for just over 3 years and has just had the rent raised by $35.00 per month as the unit is currently way below market value.  

House #1 – This is a 3 bedroom, 1.5 bathroom house in northeast Philly.  It is one of the typical "row homes" that are prevalent in Philadelphia.  This unit is unique in that it has a breezeway.  That means that there is a break in the center of the block.  This house is basically the end of a row but situated in the middle of the block.  This provides for a slightly larger house than the standard row homes on the block.  It also has more land as there is a side yard and the front lawn extends beyond the side of the property.  Tenant pays for all utilities.  The first $30 of the water bill is included in the rent.  This house has forced air heat and central air conditioning.  This unit has a finished basement with a gas fireplace.  I provide a dish washer, refrigerator and clothes dryer.

web log for us – those that learn from the other blogs we read 

    The rental market in Philly is picking up quite nicely and rents have been increasing but I kept running into prospects who did not qualify.  It was either no job or a short time at the current job or a horrible credit score (or a combination of the above).  I try and weed these people out before they come to see the property with my phone interview but I was amazed at the amount of people who came and filled out applications knowing they had this on their background.  I guess they thought I wouldn't check their information out.  They thought wrong.  Since there is a $35 application fee they were basically throwing away their money.  I guess that is part of the tenant mentality.

    As Murphy's Law would have it I ended up getting a few good applicants all at one time so I had my "pick of the litter" so to speak.  I actually went against one of my normal items of "no pets".  I figured it was best because I know that I will need to replace the carpeting in about 2-3 years and I am hoping that these tenants stay that long.  If they do I will just go through the normal replacement schedule as I had planned.  The $600 pet deposit fee will help cover that cost if there is any damage anyway.

    It's times when I have to turn down good applicants like these that I wish I was faster at acquiring properties.  Hopefully this tenant will be a winner.  I'll keep everyone posted as to how it goes.

web log for us – those that have others pay our mortgage for us.