Rental Property Update May 2009

By | May 9, 2009

Living RoomThis post is an update on my rental property in Philadelphia. In this section, I talk about my landlord experience – the good, the bad, and the ugly. All my posts that are related to the rental property can be found in the Rental Property section, including the bad tenant saga series).

April 5
I went to Philly during the first weekend of April to inspect the house. Earl had told me there were many damages and I wanted to see it for myself. I brought my camera to take pictures of the house. Earl was there and walked me through the house and show me the damages. He brought a contractor along with him so he can give me a price quote on the work.

Here is a list of things that was noted damaged or needs to be repaired:
1. The storm door (front of the main door) was smashed and could not be closed.
2. The living room window (front of house) had a hole about the size of a baseball.
3. The dining room window (back of house) was badly smashed and needed to be completely replaced.
4. There were two holes in the dining room wall (below the window), about the size of golf balls.
5. The walls were scratched up in the living and dining rooms.
6. The carpet was stained in the living room, dining room, and kitchen.
7. The kitchen carpet needs to be replaced (going to be vinyl)
8. The master bedroom carpet was missing a rectangular piece, approximately 6 inches x 2 inches. The entire carpet needed to be replaced in the room.
9. The second bedroom carpet had heavy spots of stains near the window.
10. The third bedroom carpet had a small spot of dark, reddish stain near the door.
11. The living room closet door had two heavy dents on it, and the door needed to be replaced.
12. The second floor hallway closet door had a heavy dent on it.
13. The window area in the bathroom had molding.
14. The toilet seat in the bathroom was in bad condition and needed to be replaced.
15. The towel holders in the bathroom were removed.
16. Many of the light bulbs in the house were removed.
17. The dining room chandelier was missing two glass panels and one light bulb.
18. The air vent cover near the floor of the living room needed to be replaced.
19. The refrigerator was dirty and smelly and needed to be deep-cleaned.
20. The basement sink was not flowing properly. The faucet was broken and came off.
21. The garage door electronic opener did not work.
22. One ceiling panel in the basement had flood stains and need to be placed.
23. There is a puddle of water in the back of the garage.

April 9
Earl told me that the utility company had cut the power from the house. I called PECO and try to turn the power back on. They told me that there is an overdue balance (from my ex-tenant) and that’s why they shut off the power. They asked if I want to pay the overdue balance. I told them no, and that I am not responsible for it.

I told them that I’m the owner of the property and I want to transfer the account to my name.They asked for two forms of ID: driver’s license and social security card, and proof of ownership of the house.

April 10
I submited the information required to PECO via fax and asked them to re-activate the power.

April 22
I called PECO to follow up with the status of the application for the electric service. They told me that the service will be activated tomorrow on April 23.

April 24
Earl called me at 8:30 in the morning and asked if the power was turned back on in the house. I told him that the house should have power now after I made the phone call to PECO early in the week.

He told me that he would call the contractor, Vincent to continue his work. He had already painted the walls, replaced the carpet in the master bedroom, and was in the process of replacing the kitchen floors.

I inquired about the tenant search. He told me that there was a couple who was interested in renting the place, however their combined income was too low. I reminded him that we should make sure that the credit score and credit history of the prospective tenants are good. He told me that the income is the most important factor, because you can have a tenant with great credit history but poor income. He suggested that we look for people with steady income over the years and who can pay the rent. He told me that the credit score of the people would not be in the 700 range, but more like low 600s and high 500s. Knowing that the renters in Philadelphia generally do not have a high credit score, I did not want to debate it. I told him to look for a “good” tenant. He said that he will continue working on it and update me later.

April 25
Earl called me in the afternoon and gave me updates on the contractor’s work. Earl told me that the work was already done and but there was a slight problem. The doors that were to be replaced in the house cost more than the initial quote. Earl told me that the total price for the doors was $250 alone, excluding the labor. He said that I was getting a great deal. He told me that the cost of material was expensive and that Vincent was charging a small amount for labor. I told him that I would pay only $200 in addition to the agreed price. The total price was now $1,500, instead of the initial $1,300. Earl asked me to send a money order payable to Vincent to his address on Monday. I asked him to look at the house after the contract work was completed and the quality of the work was at least satisfactory.

Notes:
Earl = My real estate agent
Vincent = Contractor
Names are changed to mask people’s real identity.

Read more:
Rental Property Update June 2009
Rental Property Update April 2009

7 thoughts on “Rental Property Update May 2009

  1. Philly_LL

    Tell Earl he needs to learn his business a bit better. He is correct in that you will get a bunch of applicants that have high 500 low 600 scores. You can also find applicants that have mid 600 scores but you must look at the whole picture and not dismiss any part of the criteria.

    An applicant who has a ton of unpaid medical bills will have a horrible credit score. To me they could be acceptable if they have nothing else derogatory on their credit report. The reason is that it tells me that they had some medical expense which they couldn’t afford. It also tells me that they put all other bills above the medical expense during the illness. What will they do if the illness returns? I feel pretty confident that they will pay me and their other creditors. Truth be told if I had a medical expense which I couldn’t afford, it would be the one bill to go unpaid by me also.

    Income isn’t everything. Someone who makes a good amount of money could have a great credit score. What would interest me is if they are too maxed out. If they make 3 times the rent gross per month but have $1000.00 in revolving debt payments plus a $500 car payment each month then they won’t be able to afford my rent plus utilities. Not comfortably anyway.

    Length of time at the employer, the whole credit history and of course current and previous landlord references are a must. No evictions on their record is also a requirement of mine. Look at the whole package. You can’t dismiss any part of it.

    I think his suggestion of steady income over the years is right. It matches the “length of time” requirement. They should gross, at a minimum 3x the rent. They should have no recent late payments and no history of defaulting on debts. One small default here or there is OK or one period where all the defaults happen together could be excused but a history of doing it is a red flag.

    Reply
  2. Smarty Sean

    Hi Philly_LL, very good pointers. I agree with what you say. I don’t think we can dismiss a potential tenant on the unpaid medical bills alone. Most medical bills are overcharged (to the insurance) and many people can’t afford or don’t think they should be responsible for ridiculously overcharged prices. If the person has everything else in place – the income, good credit history (other than medical), responsible use of credit, no (non-medical) debt, good rental history, no criminal history, recommendations from previous landlords, etc, then the person can be accepted to be a tenant.

    I am looking for and researching potential tenants. I’ll keep you guys posted.

    Reply
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  7. S J

    We set up a site JUST FOR this! Tenants cannot get away with this crap.

    Check out our site, we are compiling a list of deadbeat tenants.

    Reply

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