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Fraud Alert: Fake Checks Used for a Variety of Costly Scams

Despite what you might think, it isn’t easy to spot a counterfeit check. Fraudsters know how to make a fake check look completely legitimate — so good that even a bank teller can’t spot it.

That’s why fraudsters are using fake checks to commit all sorts of scams, including security deposits, phony prize awards, fake job offers, mystery shopper scams, and bogus online classified ad sales.

“This scam comes in many different variations” said John Breyault, who runs the National Consumers League’s Fraud.org website. “But the key thing that binds them all together is the use of a fake check. The consumer is instructed to deposit that check into their personal account and then send a portion of the proceeds to someone right away.”

Most victims are instructed to send the money via a wire transfer service, such as Western Union or MoneyGram. But some are told to buy prepaid debit cards or iTunes gift cards that they can use to buy things.

When the bank discovers the check is counterfeit — which could be days or weeks later — that deposit is removed from the victim’s checking account. The crooks already have their money and the poor consumer is left holding the bag.

Earlier this year, the Better Business Bureau released a list of the Top 10 Most Risky Scams based on an analysis of complaints collected through its online Scam Tracker. Fake check scams came in at number two, just behind home improvement scams. That ranking is based on how many people are targeted by the scam, how likely they are to fall for it and how much money the average victim loses.

“This is definitely a very, very serious concern right now,” said Emma Fletcher, director of scam and fraud initiatives at the BBB Institute for Marketplace Trust. “The typical loss to a scam that’s reported to us is about $275, but with fake check scams the median loss is almost $1,500. That’s a lot of money.”

While anyone can fall for a fake check scam, the BBB’s analysis shows that men between the ages of 18 and 24 are the most susceptible. This is also the top scam for students, and military families and veterans.

These Crooks Are Clever
Fake checks are commonly used to steal money from people who want to become mystery shoppers. Kathy, who lives in Dallas, Texas, got taken for $2,650 this way. She asked that we not use her last name.

“What these crooks are doing is disgusting, absolutely disgusting,” Kathy told NBC News. “They’re really clever and they need to be brought to justice.”

Kathy had done mystery shopping before, so she wasn’t surprised to get an email from a mystery shopping company asking her to do some work for them.

“The email seemed totally legit and everything on the website seemed on the up and up, so I didn’t question it. There were no warning signs,” she said.

Kathy’s first assignment as a “survey agent” was to rate money transfer companies. The mystery shopper scammers sent her a check for $2,850 and emailed her a list of questions to fill out about her experiences.

“It was a cashier’s check and it looked totally legit,” she said.

Kathy was told to deposit the check, take the cash and go to three different money transfer services and wire $900 from each. That left her with $100 for doing the job. She did as instructed.

About a week later, Kathy got a letter from her bank. It said the $2,850 check was counterfeit and couldn’t be cashed, so the money she had withdrawn would be debited from her checking account.

“The bank should have been able to determine immediately whether the check was legit or not and they didn’t. And that really disturbed me,” she said.

Kathy realizes she’ll never get that money back, but she hopes that by sharing her experience she can prevent others from becoming victims.

Why Fake Check Scams Work So Well
Few of us understand how the banking system works and the scammers use that confusion to trick us.

When we deposit a check, the financial institution is required by federal law to make the money available to us long before it can be certain the check is legitimate. We see the money show up in our account and assume the check is good and has cleared.

Fake check scam victims frequently report that their financial institutions decline to help them.
But that’s not what really happens. It may take a couple of days or a week or more for the check to work its way through the banking system and actually clear. During that time period, the bank gives us a short-term, no-interest loan using that check as collateral. If the check bounces, we have to pay back that loan in full.

“Unfortunately, you don’t realize you’ve been defrauded until you find that your bank account has a big negative balance,” said Fraud.org’s John Breyault. “And because of how our banking laws are written, it’s the consumer who’s on the hook for that — not the scammer and not the bank. It’s not like a fraudulent transaction on a credit card that you can dispute. It doesn’t work that way with personal checks.”

Victims Say the Bank Wouldn’t Help Them
People who’ve lost money to fake check fraudsters frequently complain that their bank teller did not warn them about the scam and their financial institution would not help them when the check turned out to be bogus.

Erika, a single mom in Oklahoma City who preferred not to be identified by her last name, was excited to be offered a work-at-home job this past spring. Her new employer sent her a check for $1,000 to buy office supplies and cover her first paycheck.

Erika was told to cash the check at her bank, take $979 to another bank in town and deposit it into the account of a corporate vendor who would ship the supplies she needed to get started.

A few days after she did that, Erika got a call from her bank. The check was a fake and there would be a $979 debit to her account. Not only that, but the debit caused her account to be overdrawn, which meant in addition to the $979 stolen by the scammers, she now owed the bank overdraft fees.

“I’m looking for a job, so I can provide for my three year old son, and instead I get fleeced,” she said.

Erika told NBC News she asked the bank if they could help her with this, but she was told there was nothing they could do. That’s not uncommon. Fake check scam victims frequently report that their financial institutions decline to help them.

The nation’s bankers insist they take fake check fraud very seriously and are doing a better job of spotting it and stopping it. For example, the American Bankers Association said tellers are trained to say something and ask questions when they see a transaction that appears to be suspicious.

“These losses are not something that bankers ever want to see,” said Doug Johnson, ABA’s senior vice president of payments and cyber security. “We continually educate our customers about the frauds being perpetrated against them, but we can’t stop every crime.”

That’s why it’s up to you to protect yourself and understand how scammers use fake checks to steal your money.

The BBB’s Emma Fletcher told NBC News she cannot think of any legitimate business transaction where someone would send you a check, ask you to deposit it and wire back the money.

“Any time you’re asked to do something like that, an alarm should go off that this is a scam,” she said.

The Federal Trade Commission has information on Fake Check Scams and the Better Business Bureau provides 10 Steps to Avoid Scams.

5 Tenant Red Flags Landlords Should Look Out For

Landlords can sometimes get a bad rap for being ruthless, money-driven tyrants. The truth is, many landlords do a great job at keeping their tenants happy and, in return, reap the benefits of these people being taken care of. There is a downside for you as a landlord, though, and that occurs when you have not screened your tenants as well as you should have. Even with a proper screening, bad apples can occasionally sneak through, and that’s why it’s important to know the signs of a bad tenant. Read on for five red flags you need to look out for as a landlord.

1. Bad Landlord References
One of the most important things you can do is to call past landlords, as you want to know their history of payments, how they treated the rental property, etc. If the past landlord tells you there was an extensive history of late payments, damage done to the property, or, far worse, an eviction, this should be a giant “no” in your book. This is particularly true if these have been recent. If the bad behavior was far in the past and they have since had good reports, this is up to your discretion, but still be wary.

2. Bad Credit And/or a Tax Lien
Good Landlord 101 includes running a credit check, as knowing how (or if!) they pay their bills is key in deciding whether or not to let them live on your rental property. How landlords read credit reports is also crucial, so if you’re new to doing so, get some help from a company like TransUnion and do your research. Bad credit is a huge red flag and could indicate that they will have trouble paying their rent—tenant screening can save a huge headache. Of course, if the IRS can’t get money from them (hence the tax lien), how do you expect you will do the same? You definitely do not want a squatter!

As for the nitty gritty of credit numbers, be wary of anyone with a credit score of less than 620. As this GreenResidential.com article notes, “A low credit score can be indicative of many things: problems with budgeting, holding down a job, or taking on too much debt. Whatever the reasons, avoid these tenants at all costs.”

3. Criminal History
You are well within your rights to run a background check on your potential tenants. If your gut instinct tells you that this is a solid person and his or her credit check and references turn out okay, you might consider ignoring any minor offenses. However, someone with a major criminal history is obviously someone you don’t want living under your roof, especially if you have other renters in the vicinity.

4. Gaps in Employment And/or Low Income
Your application should include a pretty extensive list of their past employers and how much they have made at each job. Long gaps in history could be an indication of flakiness and low income. You also want to be wary if they make very little money at their current jobs, as you have to weigh the rent vs. this amount of money. If it doesn’t seem to add up, it’s a red flag. Of course, you could ask that someone co-sign for them so that you have someone to recoup the money from him if you need to. That’s something that’s left to your discretion and many landlords will go with their intuition on this.

5. Awkward Behavior During the Interview and Negotiation Attempts
Again, we can’t stress enough the importance of gut instinct. If the person seems overly nervous during the interview and can’t hold eye contact, it could be a red flag. What are they hiding? If there are gaps on their application and they can’t answer many questions during the interview, they could be hiding be a giant secret (or secrets!).

Attempts at negotiation of monthly rent and/or deposit amount don’t have to be huge red flags, but they’re not great signs either. If you know your rental property is fairly priced, stick to that number. Negotiation could be a sign that they are not able to pay this amount on a regular basis.

Position Realty
Office: 480-213-5251

The 5 Most Common Reasons Tenants Leave Your Rentals

Why are renters leaving your units? What can you do about it?

Tenants are on the move. What are the most common reasons they may leave your rentals? How can landlords prevent these moves to keep good tenants, maintain consistent cash flow, and maximize cash flow?

The 5 Most Common Reasons Tenants Leave Your Rentals

1. They want to move somewhere cheaper.
Housing costs, especially rents, have been rising for the last five years. Some are just at the point where it makes sense to move somewhere cheaper where renters can get a lot more for their money. It could be that local rents have just gotten too high—or maybe your rents, in particular, are too high.

Market rents change over time. Be sure you stay tuned into local trends, even when you aren’t actively looking for tenants. If neighboring properties are leasing for 30% less than yours, that could become an issue. Price your properties right. Invest in stable and upcoming locations with more room for growth.

2. They’re afraid of changes in the rental situation.
Sometimes tenants leave just because they are afraid. They may be afraid of how much they think you are going to raise the rent when it comes time to renew. They could be afraid you are going to evict them because they’ve fallen a few days behind on rent a couple times. Or it could be that a tough new property manager you’ve brought in is causing panic in the renters.

Set clear expectations. Get feedback from loyal, long-term renters you trust when you bring in new management, connect with them about renewing leases early, and maintain property upkeep to show tenants you’re a caring landlord, not a slumlord.

3. They need more space.
Between a growing number of multigenerational households and Millennials’ growing families, many simply need more space today. A lot of people jumped on the minimalist lifestyle after 2008, but now, years later, they are tired of living so tightly and cramped. In fact, a Realtor.com survey shows that this is driving far more Millennials and Boomers to choose single family homes in the suburbs over homes in dense urban centers or condos.

4. They want to buy a home.
With rents more expensive than mortgage costs in many areas, interest rates low, and credit scores recovering, many are making the leap to buy homes while it is still so attractive. If you can’t stop it, make the best of it. Ensure a good exit service. Return deposits and ask for a review on the spot. Still, if you can, get them to buy their home from you.

5. They don’t like the neighbors.
No one likes scary or abusive neighbors—and they are out there. This is something to keep in mind when searching and screening rental properties. It is also important to keep lines of communication open and to listen to these complaints. If there are problem tenants in your own neighboring units, you probably won’t renew their leases. If they belong to another landlord, you may want to preempt issues by contacting the other landlord.

Summary
There are a number of reasons good tenants can leave, even if they like the units they are in. Smart landlords will get out in front of these issues and find ways to keep those tenants in their property to avoid turnover costs.

Position Realty
Office: 480-213-5251

Nine Sneaky Fees to Watch for When Hiring a Property Manager

To many landlords, property management services are superfluous, cutting their profit margins to a minimum in exchange for basic services. But the reality is that property managers can make your life extraordinarily easier—and most charge a reasonable enough rate that you can draw a monthly profit from your properties (headache-free).

However, when you’re searching for a property manager to handle your landlord responsibilities, it’s important to note that not all fee structures are the same. If you don’t understand how a manager’s fees work, you won’t be able to compare apples to apples, and you might end up shaving your profit more than necessary if you aren’t prepared for those fees when they come up.

9 Fees to Watch For
These are some of the most common “hidden” fees, extra fees, and differences in fee structure to watch for when comparing providers or finalizing a contract:

1. Rent Due and Rent Collected
Many property managers will charge fees as a percentage of rent, but watch how this is worded—there’s a difference between charging as a percentage of rent due and a percentage of rent collected. A percentage of rent due means your company will charge you based on how much money a tenant owes you; a percentage of rent collected means your company will charge you based on how much money a tenant actually pays you—and is generally more favorable. If you’re charged based on rent due, you’ll end up paying for property management even when your property is vacant and you have no money coming in.

2. Early Cancellation
You may also be charged an early cancellation fee should you break the contract with your property manager before the end of its outlined term. For example, if you agree to work with them for a year and you want out after eight months, you might pay an additional few hundred dollars. Be especially wary of this fee with untested property managers.

3. A La Carte Management Fees
“A la carte” management fees refer to a suite of extra fees a property manager may charge you in addition to basic services. Usually, a property manager will either charge a higher price (and no additional fees) or a lower price, with multiple additional fees, somewhat evening out. Accordingly, it pays to know what fees are applicable and what they might run you. The remaining items in this list could all be classified as a la carte management fees.

4. Vacancy
If a company isn’t charging you the full cost of management while your property is vacant, there may still be an additional vacancy fee. Rather than collecting a percentage of rent due, they may collect a smaller amount from you as a kind of retainer.

5. Advertising
When it comes time to seek a new tenant, some property managers may charge you an additional advertising fee. This would cover the cost of creating media (such as taking photos) and placing it on sources like online listings or paper publications.

6. Leasing
A leasing fee may apply when you find a new tenant for your property. This covers the cost of drafting and securing a new lease agreement and is generally low in cost. If the cost here is high, it should raise a red flag, especially if your resulting tenant turnover seems to increase.

7. Lease Renewal
Lease renewal is even simpler than initial leasing, but it may still require a fee. You may need to draw up new paperwork or renegotiate terms with a tenant, and that means your property managers will be doing a bit of extra work. Expect minimal fees here as well.

8. Maintenance
Property management fees should cover basic instances of maintenance and repair, but some companies may charge extra for big jobs, or for an inspection between tenants.

9. Eviction
Eviction can be a messy process, and if you ever need to evict, you’ll be grateful you have a property management service in your corner. Most property managers will handle the eviction completely on your behalf, but some will charge you an extra fee for the extra work involved. Expect to pay at least a few hundred dollars for this process.

Apples to Apples
Different companies might charge money in different ways, but if they’re offering similar services, you’ll likely find the bottom-line price of each to be competitive with one another. The big difference here is how you plan on using your property management company; for example, if you’re looking for long-term arrangements, an early cancellation fee shouldn’t factor much into your decision. Try to consider all these factors and all price points when comparing providers and making your decision.

Smart Landlord Policies for Pet-Friendly Property Rentals

Want a surefire way to increase tenant demand for your rental? Take down the No-Pets Allowed sign.

The decision about whether to allow pets is a tough one for many owners, and there are no right or wrong answers. But some surveys show that nearly 75 percent of renters own pets. That’s a huge pool of potential tenants to turn away.

Tenants who find a welcoming home for Fluffy are also more likely to stay longer, which can reduce vacancy time. For owners renting their property as an investment, being pet-friendly makes good business sense.

But allowing pets isn’t always the right answer for owners renting out a home they plan to return to. For owners who have pets themselves, allowing renters to keep a cat, dog or goldfish will likely make leasing the home faster and easier. For those who haven’t had pets, keeping the rental pet-free is a reasonable choice.

According to a recent survey by Apartments.com, 9 out of 10 renters said deciding where to live hinged on the landlord’s pet policies. Seventy-two percent of renters said they owned pets.

Protecting Your Property When Allowing Pets

How can you avoid the dog that barks day and night and chews the cabinets, or the kitty that favors the closet floor over a litter box? Finding responsible pet owners is key to protecting your property and neighbors’ sanity.

The Humane Society suggests that landlords check references on both the tenant and their animal, including calling prior landlords, the veterinarian and neighbors to ensure the animal behaves and won’t cause serious damage.

The organization suggests owners limit the number of pets allowed in each unit and approve pets on a case-by-case basis, rather that create limits based on size or breed. The Humane Society recommends creating a pet policy that outlines acceptable pet behavior and requires that all pets be licensed, up-to-date on vaccinations and spayed or neutered.

Deposits and Fees

Beyond policies, landlords often charge extra deposits, fees or pet rent to limit risk and cover the cost of additional cleaning or wear and tear animals can cause to the unit, building and grounds. In the Apartments.com survey, nearly 80 percent of renters said they had to pay a fee or deposit for pets, with more than half paying $200 or more per year.

Be aware of what’s customary in your neighborhood plus local laws when deciding how much of a fee or deposit to charge.

Preventing Mold Overgrowth and How To Prevent It

Mold problems can be incredibly expensive to repair, sometimes requiring entire rooms being torn down to the studs. Certain types of mold can cause illnesses from skin irritation to obstructive lung disease. What is truly frightening about mold is how easily it grows. One study from the University of Arizona showed that 100% of the homes it tested showed positive for mold (1). 100%! If mold is so pervasive, how do we prevent it?

Mold Audit Your Property: Start by doing an audit of your property for hazards. Do you notice any of the following?

  • Flood prone areas
  • Carpeting in moisture prone areas
  • Water stains
  • Condensation build up on windows
  • Poorly ventilated kitchens or bathrooms
  • Clogged & broken gutters

Look into the best fix for your problem(s). While some solutions can be simple, some may require more complexity and cost.

Air Out: Moisture builds and accumulates in moist areas when there is insufficient airflow or ventilation. Make sure that you open windows in unoccupied properties regularly. Install high functioning fans and stove hoods to stem mold growth in the kitchen, laundry room and bathrooms. You may even consider adding dehumidifiers into your properties.

Keep Water Away: It’s important to remember that buildings are susceptible to mold growth from the outside in. Think about where water accumulates around the perimeter and then direct it away. Use flexible extensions on the end of downspouts and alter ground cover choices. Remember to keep gutters clean to avoid pooling water at the roofline.

Your Plumbing: While it is true that some leaks can be spotted and easily fixed throughout your home, many cannot. This is because much of plumbing systems remain unseen behind walls and underfoot. Major mold growth occurs frequently in properties with leaks that have been unaddressed for long periods, as the first warning sign is often a water stain or worse. Consider installing a leak detection system like AquaTrip.

AquaTrip is a permanently installed system that constantly monitors the entirety of a building’s plumbing. AquaTrip saves money by curbing potential water damage, reducing excessive water bills and controlling the potential for mold overgrowth. You can learn more about AquaTrip by visiting buyaquatrip.com or call 1-844-4-AQATRP to find out how you can join the Pilot Program for savings up to 50% off!

5 Ways To Increase The Value Of Your Rental Property

When you hold property as a rental investment, it’s only natural to want the value of your investment to increase. While the real estate market plays a role in the value of your properties, you can take matters into your own hands with home improvements that add value.

Five great ways to boost the valuation of your rental property and how to make these improvements.

Replace old bathroom fixtures. Bathroom upgrades deliver immediate impact and value. Replace outdated sinks and toilets with low-flow models that feature new hardware. You’ll save on water bills and instantly improve your apartment’s valuation. When replacing bathroom fixtures, hire a professional plumber to do the work.

Renew kitchen countertops. Even a minor kitchen upgrade will retain roughly 80 percent of its value five to 10 years down the road, which is great news for property owners who want to make money now and sell for a profit in a few years. Replacing cheap laminate countertops with wood, granite, cement or engineered stone is a great place to start when renovating an old kitchen. Hire a countertop installer for this task.

Dump old carpet and linoleum for high-end flooring. If your rentals have linoleum and wall-to-wall carpeting, this screams cheap and ugly to renters looking for a new home. Increase your apartment’s appeal and valuation by upgrading your flooring. Natural materials like wood or stone are favorites. These materials are durable, easy to clean and hold their value once installed.

Update lighting and appliances. Adding new fixtures and appliances can brighten the apartment, increase energy efficiency and give an old unit new life. If you have pre-1990 lighting, replace it to slash energy expenses and make the apartment look more modern. Always have lighting installed by a licensed electrician.

If you have old appliances — anything from a dishwasher to a hot water heater — swapping them for sleek, stainless steel, energy-efficient models will boost your return on investment and slash your overhead. Order new appliances during seasonal sales to get the lowest price. Many stores take away your old appliance for free when they install the new ones for you, reducing your overhead.

Increase storage. Storage is a top priority for renters. Whether you add a basement storage cubby, place a shed in the backyard, add open shelving in the bathroom, or put hooks by the front door, you’ll help renters make the most of the space. You can keep things cheap and easy by using hooks and shelves you can hang yourself, or hire someone for more sophisticated storage upgrades.

Tips for Property Owners Who Want to Improve Rental Investment Value

Plan smartly by making home improvements in between tenants. Time your repairs so the unit’s ready when demand peaks in your area. This way, you can rent out the renovated unit quickly and command a competitive price. In turn, immediately starting to recoup the money spent on repairs through the higher rental property valuation and new market-rate rent.

Questions You Cannot Ask a Prospective Tenant

When interviewing prospective tenants, you want to make sure you get the best tenant for your property, so naturally, you want to ask them as many questions as possible. You have to be careful however. There are many questions which you are legally not allowed to ask tenants. Learn what not to say when interviewing a prospective tenant.

1. Questions That Violate Fair Housing Laws
Never ask anything that could be interpreted as discrimination under the Federal Fair Housing Law or under your State’s Fair Housing Law.

The Federal Fair Housing Act protects seven classes: race, color, religion, sex, national origin, disability and familial status. In addition, many States have additional protected classes such as marital status and sexual orientation.

Examples of questions/statements that could violate the Federal Fair Housing Act:

Race:

  • What race are you?
  • Are you Chinese or Japanese?
  • You look Italian. You should consider renting in the next town over, there are a lot of pizza places around there.
  • You would love the area, a lot of minorities live here.

Color:

  • You have very dark skin, are you white or Hispanic?
  • You’re very pale, I don’t know if you’d fit in here.
  • You have dark skin, I don’t know if you’d feel comfortable in the neighborhood.

Religion:

  • I’m not Christian, so I don’t want you to put up any Christmas decorations in my building.
  • There aren’t a lot of temples around here, I don’t know if you’d fit in.
  • Are you Buddhist? Don’t go turning one of the rooms into one of those meditation places.

Sex (Includes Gender and Sexual Harassment):

  • Having someone who looks like you as a tenant would definitely make me check on the building more often.
  • I don’t feel safe renting to a woman on the first floor.

National Origin:

  • In what country were you born?
  • Where were your parents born?
  • What is your first language?
  • Are you disabled?
  • I don’t allow animals, so I will not allow your service dog.
  • Are you an alcoholic?

Familial Status:

  • I don’t rent to people with kids.
  • Are you pregnant? I don’t want a screaming baby disturbing the other tenants.

To be safe, you should also avoid questions about marital status, sexual orientation, source of income, age or any other possible protected class in your State.

  • Are you married?
  • Are you divorced?
  • Are you gay?
  • (To a man:) I think having your boyfriend visit will make the other tenants uncomfortable.
  • You’re going to have to pay a higher security deposit because your income is from unemployment and I’m afraid I might have to evict you in the future.

2. Have You Ever Been Arrested?

You cannot ask a prospective tenant if they have ever been arrested. There is a big difference between being arrested and being convicted of a crime. You can ask the prospective tenant if they have ever been convicted of a crime. This is something that can be readily discovered by running a background check. Keep in mind that in many states, such as California, you cannot discriminate against a person because they have been convicted of a crime.

The crime would have to influence their ability to be a good tenant, such as an illegal drug conviction or a history of violent offenses which could put other tenants at risk.

3. Any Question That Is Not Part of Your Normal Qualifying Standards

You must have the same qualifying standards for all prospective tenants. It you do not follow the exact same procedures for all tenants, you could be accused of discrimination. For example, while it is legal to perform credit checks on tenants as long as they consent to it, if you only perform credit checks on African American tenants, this would be considered discriminatory.

Another example would be if you asked people who were not necessarily well dressed questions about their eviction history or criminal convictions, but ignored such questions for people who were well dressed. This would also be discriminatory. You should set a list of questions that you will ask all prospective tenants to “qualify” them as potential tenants.

Tenant Screening Saves You Time and Money

After a few weeks on the market, you finally found a tenant for your rental property. Because it’s been sitting vacant for more than a month, you decide against the tenant screening service you normally use. The information on the application seems good, and the one reference you contacted vouched for the applicant. Everything should be just fine. Right?

Fast forward a few months.tenant screening saves time money

You haven’t received the rent on time since the tenant moved in and now it looks like you won’t receive this month’s rent at all. Your old neighbor called to let you know that the yard looks horrible and there’s suspicion of drug activity going on in your property. You remember reading somewhere that if a crime is committed in your property, you might be found liable for it.

You’re out the rent money. You’ll have to pay to deal with the eviction and there’s no telling how much damage has been done to the property. Once you get the tenant out, it will sit vacant and produce zero income until you’re able to fix it up, get it back on the market, and find a better tenant.

This scenario plays out every single day with landlords across the country, but it doesn’t have to.

save-time-money-piggy-bank-clock

Tenant screening saves you time and money.
Here’s how:

Financial History
Checking a tenant’s credit score lets you know if they consistently pay their bills on time. You may decide to rent to someone with a poor credit history due to the circumstances surrounding their late payments or bad debt – medical problems, divorce, or more. Knowing their financial history lets you decide if you should charge a higher deposit or move on to the next tenant.

Eviction History
Eviction history information may come from just your state or you can check nationwide, but it’s invaluable to know before you approve a new tenant. There’s no guarantee that your tenant won’t need to be evicted even with a spotless history, but it’s always better to be safe than sorry. You can save yourself the time and cost of the eviction process by checking a tenant’s history and making the decision whether to rent to them or not.

Criminal History
If a crime is committed in your rental property, criminal charges could be brought against you. As a landlord, you also have an obligation to the neighborhood where your property is located to help keep it safe. A criminal background check, as well as checking the terrorist watch list and the sex offender registry list let you know ahead of time if you’re dealing with a dangerous felon or someone who simply made a youthful mistake. There isn’t enough money or time that can make up for a horrific crime being committed in your neighborhood or property simply because you didn’t have a criminal background check done.

Verification of Personal Information
This may sound basic, but you need to know if your tenant is who they say they are. Using a tenant screening to simply help verify their information may save you time and money as well as prevent further identity theft or other criminal acts. It’s likely that if someone lies about their basic information, their financial, eviction, and criminal histories may be spotty as well.

It may seem to be quicker and cheaper to skip the tenant screening with a new tenant. You need your property to produce income and for that you need a tenant. Screening protects you and your property as well as giving you peace of mind about who you’re renting to. Save yourself time, money, and headaches and screen all prospective tenants.

Position Realty
Office: 480-213-5251

How To Collect Money Owed From Your Tenant

Did you ever have to evict a tenant for non-payment of rent, then get stiffed for the bill? You may be able to collect what is owed to you, even years later.

First, you need a court-ordered money judgment. If you filed for an eviction in court, you received a judgment and order of possession – a document signed by a judge that permits a local sheriff or constable to forcibly remove the tenants from the property. In Arizona you get a money judgment against the tenant, but this requires one of two things:

1) the tenant must have been personally served with the court papers or…

2) the tenant must have shown up in court. If the eviction papers (the court papers, not the notice to rent) were posted on the door of the unit and/or mailed to the tenant, you generally do not get a money judgment from the court.

What About Security Deposits?

If you have a security deposit from the tenant, you can apply that against anything he owes you for back rent or damages. However, you still must comply with state law for notifying the tenant of your intent to keep the deposit. Even if you return the security deposit, you can still sue the tenant for actual rent owed and/or damages incurred to the unit. If the tenant left before the court date or you did not otherwise get a money judgment, you can always sue the tenant in your local small claims court for money owed and any damages to the property. The process is quite simple, and does not require a lawyer. You have to file the claim before the end of the statute of limitations, which generally ranges from three to five years.

Once you have a money judgment, you can collect it against all non-exempt assets of the debtor. Certain assets, such as retirement accounts, are exempt from collection by creditors. Also, keep in mind that assets of the debtor’s spouse may be attached as well in Arizona. Cash in bank accounts is the easiest target. If you have a copy of a recent check from your tenant, you can file for a “none wage garnishment” on their bank accounts through the local sheriff (this is why it is a good practice to make copies of your tenants’ checks each month to make sure you know where they are banking).

If the tenant is working, you can garnish wages, but the garnishment is limited to 25% of the wages of the debtor. Still, if they have a steady paycheck, you will get your money back, plus interest. If you get a transcript and record the judgment in county records, the tenant will not be able to buy a house in that county without paying you off. If the tenant owns other real estate in his name (not likely, but always possible), the judgment will create a lien on that property as well. If you do not know where the tenants assets are located, you can start a debtor proceeding in court to make him appear in court and answer questions regarding his assets. Failure to comply may result in a warrant issued for the debtor’s arrest. Depending on the amount of money owed and likelihood of collecting, this process may not be worth your effort. But, considering a judgment may be valid for as long as 5 years and you get interest on your money, why not make it a part of your business practice?

Position Realty
Office: 480-213-5251

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