What to Do If A Rental Check Bounces?

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One of the most difficult parts of managing a rental property is collecting rent each and every month. As a landlord, your income is entirely dependent on the reliability of your tenants. While most residents will be timely and responsible when it comes to paying rent, you may come across some people who are unreliable or downright uncooperative. Perhaps you have a tenant who is constantly asking for an extension or, even worse, someone who pays with a check that they can’t fulfill. What should you do in these situations? How do you handle a check that has been returned?

First things first, approach the tenant that gave you the check. More often than not, it is simply a mistake. Perhaps they had intended to transfer money to their account before issuing the check, or perhaps the bank is slow in processing their transfer request. Always assume the best before jumping to conclusions. If it was not a mistake, then the tenant cannot afford rent that month, and you must move forward according to the procedures outlined in your rental contract.

After you have cleared up any possibility of simple misunderstanding, you should officially notify the tenant that their check bounced. Depending on their track record and the terms of your agreement, you may issue a grace period of a set number of days. The tenant will have to produce the funds necessary to cover their rent, as well as any late fees that you may have accrued as a result of the inconvenience. Be sure to document all communication with the tenant so that the expectations are clear and there’s no room for misinterpretation.

For future payments, consider setting up an online collection program. Rent collection programs can be set up to make direct deposits from a linked debit or credit card to your own bank account. The transfer takes place automatically at the specified time every month. This way, you’ll always receive payments on time and you don’t have to hound your tenant for money.

So, to summarize, here’s what you should do if you receive a bounced check:

  1. Approach the tenant to see if it was a mistake.
  2. If not, issue an official notice and give them a set period of time to produce the funds.
  3. Record any communication with the tenant, including dates, times, and binding agreements.
  4. Consider online payments to protect the future of your business.

For more tips when it comes to real estate and rental properties, follow the Talley Properties blog.

4 Kinds of Rental Insurance

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As a residential property owner, you want to make sure that your investment is completely
secure in case of natural catastrophe, accident or damage. Standard homeowner insurance
policies do not cover long-term rental properties. You must have rental property insurance. If
you rent out your property for short-term or vacation stays on sites such as Airbnb or VRBO,
talk to your insurance company to see whether you need to add short-term rental coverage to
your homeowner’s policy. However, in today’s blog we seek to inform owners who will rent out
their property for months or years at a time.

Rental Property Insurance

This coverage, also called “landlord insurance”, can be purchased for all types of residential
properties including apartment complexes, houses, condos, or vacation homes. The owner
must not live on the premises if this type of coverage is to be issued. It offers protection for the
entire structure of the building itself, including roof, walls and foundation, as well as other
buildings such as a detached garage. Appliances, as well as the heat and air systems, can be
added as endorsements to the policy.

Renters Insurance

You must decide whether your tenants must carry renter’s insurance. It is not required by law,
but rather the decision of each individual landlord whether they will require it. This would cover
your tenant’s personal items in the residence. It would also add a component of liability
coverage should there be an incident on the property and the tenant was found liable in a
lawsuit.

Income Replacement Insurance

In the case of damage to the rental property, or total loss of the building, the tenant would no
longer be occupying it and you will receive no rental income. Rental property insurance, as
discussed above, will cover repairs and replacement. But if it would be a hardship to lose the
monthly rent coming in, you may want to consider adding income replacement insurance to
your policy. Be careful to check the conditions, however, as most insurance companies will pay
out what is called the “fair market value”, and may assess your income replacement lower that
what you are charging for rent.

Liability Insurance

A renter’s insurance policy may cover the liability involved in an accident or injury to the tenant,
their family, and their guests. You can add additional coverage to your own rental property
insurance for an extra layer of protection against lawsuits.

You can discuss all these options with your insurance provider to ensure that you have the best
coverage for your needs.

How To Screen Tenants

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Your residential property is ready for occupancy. It’s time to start the process of selecting your first, or perhaps your next, renter. A property is an investment, so it is crucial that your tenant take care of your investment and pay their rent on schedule. A careful screening will help with the vetting process so that you can make an informed decision about a tenant who applies.

 

Before starting the screening process, it is important to be familiar with federal Fair Housing laws, as well as any additional laws that may vary by state. A landlord is prohibited from discriminating against 7 protected areas:

  • Religion
  • Race
  • Color
  • National origin
  • Disability
  • Sex
  • Family status

 

Prescreening Process

 

If you will be advertising your rental, it will help to be as forthcoming as possible in order to prevent wasted time on both sides. In advertising, describe your rental as realistically as you can. State any policies you intend to enforce, such as no smoking. Let prospective renters know if you intend to check criminal and credit records. Be clear about the amount of security deposit required as well as the monthly rental fee. If you are taking initial inquiries over the phone, have a list of questions ready that you would ask. Here are some ideas:

  • What move-in date are you seeking?
  • How many people will be moving in?
  • Do you have any pets? (Decide on your pet policy ahead of time!)
  • What is your monthly income?
  • Have you ever broken a rental agreement or been evicted?

 

Application and Info Gathering Process

 

Prepare a rental application. You will need information on anyone age 18 or older who will be living in the house, even if they all are not signing the lease, so that there are no surprises down the road involving your tenants. You will want to know about their previous addresses and get contact information for previous landlords. After you have obtained written consent, you can use outside services to gather the credit history, eviction history, and criminal history. 

 

Call all the references they have listed on the application, and have a conversation with any past landlords as well. Equip yourself with as much information as possible, so that you can feel confident that your new tenant will both take care of your investment and pay the rent. 

 

If you would prefer to let a property management company handle the tenant screenings and occupancy of your properties, you can have full confidence that Talley Properties has the expertise and experience to partner with you. 

State of the Housing Market in 2022

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The housing market over the last few years has been a particularly poignant source of conversation and, in some cases, concern. The effects of the global COVID-19 pandemic have had the United States in a vice grip, with varied results. Now that the pandemic is no longer at the forefront of everyone’s minds and people are returning to their normal lives, it’s interesting to see how these years of fear and isolation have affected the housing market.

First, it’s widely forecasted that buyer and homeowners alike will see a housing market more in line with the typical spring season. Last year at this time, the pandemic was still in full swing and homeowners were less inclined to sell. With interest rates ever-increasing, it makes sense. Why would most homeowners willingly choose to abandon their fixed-mortgage rates for something more expensive during such a volatile period in history? Of course, this led to a massive imbalance between supply (which was relatively low) and demand. Homes that were listed on the market sold quickly, often leading to bidding wars between potential buyers that caused prices to skyrocket. Those who decided to list their homes were rewarded with a seller’s market and a tidy sum of money.

This year, the seller’s market continues, though it won’t be quite as severe as it was in 2021. Whether you’re a potential buyer or a current homeowner or both, consider the following before you jump in:

  • Home prices are expected to continue rising. They won’t inflate quite as much or as quickly as they did last year due to low demand, but don’t wait around for a market crash any time soon.
  • The real estate market is based on local comps. While the national average is a good overall indicator, do some research in your area. The prices can vary wildly in either direction, and you may find yourself with a bargain on your hands.
  • A national shortage of labor and construction supplies is another reason for the low supply on the real estate market. If you’re listing a house, be sure to schedule any necessary construction or repairs far in advance.
  • Hire a real estate agent that knows the local market. They will be invaluable throughout the entire process, whether buying or selling.

The housing estate market has had its ups and downs, but there’s never been a better time to find your dream home. The world is returning to normal, and it’s time to get back to business. Follow the Talley Properties blog for more tips, tricks, and insights into the real estate market.

New & Emerging Developments in and Around Charlotte

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Charlotte, North Carolina is one of the fastest growing places in the country. Not only does the metropolitan area continue to evolve and flourish, but several of Charlotte’s suburbs are nationally ranked in growth rates over the last ten years. A few of these towns have creatively used their history as a springboard for their emerging new image.

Kannapolis is a northern suburb located in Cabarrus county. It is known for being the birthplace of Dale Earnhardt, but the central focus of the town was textiles. Cannon mill was once the world’s largest producer of sheets and towels. After decades of success, the mill closed in 2003 and the downtown found itself virtually vacant. But new life began when most of the mill property was purchased to build the North Carolina Research Campus, home to projects involving eight universities around the state. Plans took shape under the watchful eye of the city council, and in 2018 renovation of the stately brick buildings that once belonged to the mill began in earnest. The city’s minor league baseball team was renamed the Cannonballers, and a new state-of-the-art stadium and workout facility was built as the crown jewel of the downtown, surrounded by boutiques, eateries, breweries, and streetscapes. The main street alongside the ballpark is becoming a thoroughfare for mixed-use spaces, drawing new interest in residing beside or above the new retail hub of Kannapolis. The residential portion of the downtown revitalization is scheduled to be completed in 2023.

Tega Cay is a southern suburb located in York county. In the 1970s it began as a gated community along the shores of Lake Wylie when the purchasing company was inspired to create a community which felt like a permanent vacation spot. Tega Cay means “beautiful peninsula” in Polynesian and now boasts of 13 miles of waterfront. Expanding into a fully governed city in 1982, it has grown from being a small gated community to incorporating the entire peninsula in a resort-like vibe. It has recently been ranked #1 in Best Places to Raise a Family in South Carolina, offering many festivals, concerts and recreational programs to strengthen the community feel. Developers and builders are scrambling to keep up with demands, as the city’s population grew by 62% between the 2010 and 2020 census.

Moving to or looking to invest in real estate in the Charlotte area? Let Talley Properties assist you with all your property management needs!

5 Signs of a Bad Lease

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Charlotte, North Carolina is one of the fastest growing places in the country. Not only does the metropolitan area continue to evolve and flourish, but several of Charlotte’s suburbs are nationally ranked in growth rates over the last ten years. A few of these towns have creatively used their history as a springboard for their emerging new image.

Kannapolis is a northern suburb located in Cabarrus county. It is known for being the birthplace of Dale Earnhardt, but the central focus of the town was textiles. Cannon mill was once the world’s largest producer of sheets and towels. After decades of success, the mill closed in 2003 and the downtown found itself virtually vacant. But new life began when most of the mill property was purchased to build the North Carolina Research Campus, home to projects involving eight universities around the state. Plans took shape under the watchful eye of the city council, and in 2018 renovation of the stately brick buildings that once belonged to the mill began in earnest. The city’s minor league baseball team was renamed the Cannonballers, and a new state-of-the-art stadium and workout facility was built as the crown jewel of the downtown, surrounded by boutiques, eateries, breweries, and streetscapes. The main street alongside the ballpark is becoming a thoroughfare for mixed-use spaces, drawing new interest in residing beside or above the new retail hub of Kannapolis. The residential portion of the downtown revitalization is scheduled to be completed in 2023.

Tega Cay is a southern suburb located in York county. In the 1970s it began as a gated community along the shores of Lake Wylie when the purchasing company was inspired to create a community which felt like a permanent vacation spot. Tega Cay means “beautiful peninsula” in Polynesian and now boasts of 13 miles of waterfront. Expanding into a fully governed city in 1982, it has grown from being a small gated community to incorporating the entire peninsula in a resort-like vibe. It has recently been ranked #1 in Best Places to Raise a Family in South Carolina, offering many festivals, concerts and recreational programs to strengthen the community feel. Developers and builders are scrambling to keep up with demands, as the city’s population grew by 62% between the 2010 and 2020 census.

Moving to or looking to invest in real estate in the Charlotte area? Let Talley Properties assist you with all your property management needs!

Traits of a Good Tenant

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Working as a landlord can be difficult enough, having to market your space, find and manage tenants, and keep the building clean and up to code. There’s a lot of work that goes on behind the scenes. But having a difficult tenant can just make things even more difficult. Whether they’re disruptive to the neighbors or they are consistently late in paying their rent, a problematic tenant can be distracting and stressful.

As long as you have good reasons for your decisions and you’re not breaking any housing discrimination laws, you get to decide who will run out your space. There are a number of things one should do when screening for potential tenants. First, a short list of red flags and things you should probably avoid:

  • Insufficient Income. People should be on the lookout for housing that they can afford on their current income. If the prospective tenant does not make enough to afford your space, then you should probably turn them away. You don’t want the end of the month to arrive and then find that they can’t pay their rent.
  • Prior Evictions. While this isn’t always the case, prior evictions do often indicate problematic behavior or circumstances. Take a look at their rental history, and get references from previous landlords.
  • High maintenance. Everyone is entitled to their own input, but perhaps a prospective tenant seems a bit too particular. This doesn’t bode well for a long-term business relationship between landlord and tenant.

These are things that should be avoided during the screening process. Below is a list of things to look for that may indicate a good tenant:

  • Stable Income. The prospective tenant has a steady job with reliable income. It’s recommended that landlords look for an income that is 2-3 times the rental fee. That way, there shouldn’t be any late payments or requests for an extension on the payment due.
  • Polite & Respectful. During your interview, observe how they conduct themselves and how they interact with the people you come into contact with. Are they friendly and polite? This is a good indicator that they won’t disrupt the neighbors or cause any damage to your property.
  • No Eviction History. Be sure to get references during the screening process. If they have no prior history of eviction, then it’s safe to assume that they haven’t caused any issues.

The important thing is to ask the right questions and follow your intuition. Build good rapport with your tenants, and you’ll get along nicely. For more tips and tricks on the housing market and the responsibilities of a landlord, follow the Talley Properties blog.

New Developments in Charlotte

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Although not the capital of North Carolina, Charlotte has been nicknamed the Queen City. It’s big, it’s bold, it’s diverse, it’s fast-paced, and it’s growing. If you’ve ever been downtown, you’ll know that the skyline almost always shares its attractive silhouette with cranes and other construction machinery.

Charlotte is constantly under development, adding new buildings, new spaces, and new opportunities all the time. In fact, we’ve discussed some of the upcoming construction and development projects in a previous post, but there was simply too much to cover. Let us introduce you to a few more exciting prospects that you can look forward to in the years to come.

  • Lowe’s Tech Center. Charlotte’s South End will see construction of a new 23-story office building, commissioned by Lowe’s retail. The company is looking to expand their IT department, and these office spaces will allow for the growth they want.
  • The Square. The Square at South End is actually a multipurpose plaza. The Square combines a new office building, restaurant and café, retail shops, and quick access to Wilmore Centennial Park. Overall, it’s certain to be a hub of activity, situated in one of Charlotte’s most vibrant neighborhoods.
  • Centre South. Much like The Square, Centre South promises a bit of everything for everyone. Centre South will offer high-class residential spaces and amenities to match, as well as office spaces and access to the brand-new Centre Park. Of course, location is everything, and Centre South will offer quick access to local restaurants, entertainment, and other activities.
  • Duke Energy Plaza. Duke Energy has announced plans for a new corporate headquarters in Uptown Charlotte. This is all part of the company’s long-term plans to consolidate and reduce their footprint by over 50%. Once completed, the tower situated on the plaza will be one of the tallest in the city, and across the state, at 40 stories tall.

Looking at this list, it’s clear to see that the South End is the next up-and-coming neighborhood, with ambitious visions for the future of Charlotte’s infrastructure and a bold redefinition of the city skyline. Whether you’re a Charlotte native or you’re looking to move in, there’s never been a better time to be a part of the Queen City.

If you’re looking to learn even more about the upcoming development projects underway in the downtown area, you can find any previous posts on our blog. And that’s not all! Follow the Talley Properties blog to get tips, tricks, and up-to-date information about the real estate market here in Charlotte.

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