So I finally have a property we are looking to rent a 3/2 in the D/FW suburbs. I know there are several on here with a ton of experience in this matter. What advise (regardless of how trivial) would you give to a fellow newb?

I've recommended to other newbies spending some time with BiggerPockets resources searching for podcasts related to land-lording SFH. They have a rookie podcast set as well as books that are solid IMO.

AgCPA95 said:

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I've recommended to other newbies spending some time with BiggerPockets resources searching for podcasts related to land-lording SFH. They have a rookie podcast set as well as books that are solid IMO.

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This

Sounds good. I assume I should probably put it into an LLC or S corp for legal protection?

Is it owned in cash? If existing loan, then a bit more challenging to get into LLC.

The biggest factor in rental property is tenants, so tenant selection is of the utmost in importance. Can really make or break a rental property. So creating/deploying mechanisms to get good tenants and separate the wheat from the chaff.

Also, make sure you have an idea of HVAC and Plumbing company you would call if maintenance comes up.

Also, you want to make sure you can receive rent online. No need to mess with mail and paper checks in this day and age. A lot of people switching to VenMo but I like something more professional that sends an invoice and that logs a payment. Landlordstation.com and other platforms are available, even QB online to track other expenses, too.

BoDog said:

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Sounds good. I assume I should probably put it into an LLC or S corp for legal protection?

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That's a more protective way to do it if something goes really south. If you don't want to do that, I suggest at a minimum setting up a management company as a sole proprietorship or general partnership (if the property is co-owned) to treat all income and expenditures as business-related. This lets you write off maintenance, landscaping, improvements, mileage, etc. to offset the revenue for tax purposes.

ETA: It can also be helpful once it's leased to get a home warranty and put the tenant on as an authorized agent so the tenant can call in emergency maintenance without having to wait on you. Just be sure to include somewhere in the lease the terms of service call fees (i.e. tenant responsible, landlord reimburses, etc.)

This is a huge help thank you.

The tenant selection criteria is what is keeping me up at night. What methods exist (that are legal) to help choose the most ideal one?

Standard applications ask things about references, rental history and job history. Income and job verification are helpful to give you a baseline. Helps you determine how long they have worked for current company and how long they have worked in that field. If they only been at a company 2-3 years and have more work history than that, you can always get previous employment too. Make sure monthly income is 3x what the Monthly rent is.
Also, in the DFW market you should be able to push/be aggressive on rents because of rental market conditions there so keep that in mind.

Have recently gotten back into rentals after 15 years away and found myself asking the same question. Things have changed A LOT.

Had a friend recommend a site called turbotenant. Seems to work pretty well at least for the listing and contact steps (that's all I have done so far.). List it there and they push it to all the real estate rental sites.

Finding contact / leads to be a little flighty and weird. Getting decent response, but must contacts seem to ghost me when I respond. Have a suspicion that some portion of them are bots of some type. But I cannot really figure out the angle.

The site also offers rent collection options and application options, but I haven't used them first hand yet.

Nice to have these automated tools.

Other thoughts. Agree on the 3x the rent income minimum. I'm going to do strict no pets and no smoking. Just not worth the potential damages.

BoDog said:

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This is a huge help thank you.

The tenant selection criteria is what is keeping me up at night. What methods exist (that are legal) to help choose the most ideal one?

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Tons of scams out there right now.

People will rent your property out to someone else using Craigslist.

Tenants will go to https://www.paystubcreator.net and fake you out.

In Dallas their are career tenants that only seek out private landlords because they can't get good data on the people they are getting ready to rent to.

Type of car they drive. How clean the car is. Verified previous landlords by skip tracing them, all help, but no one bats 1.000.

Gbt property management can help if you want help with leases, leasing, then just do all the management yourself. Info at GBTpm dot com

Had a potential tenant contact me while work was being done. Had a big long story about his life, but things were back on track now. Living with his son atm across the street from my unit. Clearly indicated to me that he and his wife wanted to rent it. Said he is a pastor and the church would pay for housing. Told him when it was ready to rent I would let him know but he would have to qualify like anyone else, even though I didn't really like the vibe I got.

I did as I said and texted him when things were completed. Heard nothing back for 2 weeks. Blew him off. Then I get a text to go see it. Ask him to provide full name and email address and complete the pre screener on turbo tenant. Tells me the link doesn't work for the pre-screener. I told him I need information before I will show it. So he sends a photo of his license and his name and email after I asked more than once.

I agree to show it to him. When I show up a lady is there. She mentions his name and said he couldn't make it,she was his daughter. I show it to her. While there another lady shows up saying she is related somehow. Then they say they are looking at it for their 77 yo grandmother,not the original guy.

I question the obvious inconsistencies and got vague answers. They were pushy and said she could move in tomorrow. She won't have much history, but the "church" will pay the rent. I tell them she would have to complete and app like everyone else and be screened. That I would not accept the church paying the rent.

Have delayed on sending the application hoping they would go away, as I have no intention of renting to them based on the weird inconsistent stories. But she called again today. Trying to decide if I should send over the app and run it or if I should just say that due to the inconsistent stories and such I am out on them.

Worried that they may try some discrimination angle if I just say that and figure they won't qualify with verifiable information,so leaning toward letting them do an application.

Not a particularly auspicious start.....

I always send applications, everyone is always open to apply. Not everyone is qualified to rent.

You are in the right by being suspicious. They need to fill out the application in its entirety and if it is one you have to pay to do that is another line of defense in weeding people out. Credit will need to be run. Income verified. All the stuff. You are not running a charity, this is your livelihood, and they are not doing you any favors by "taking it off your hands" and leasing it. There are plenty of prospective lease applicants out there, especially now, with rates being what they are.

After I posted, I talked to a friend who is full time in rentals and managing rentals for the last 20 plus years. Explained the situation. He had interesting information.

He said that as a small time landlord with 1 to 4 properties, I can basically descriminate (for lack of a better term) for any reason. So if someone like this gives a bad feeling, tell them in simple terms and then cut off communications. After you have more than 4 units, the rules change apparently. I expressed surprise and he said, it is what is it by Texas law.

So I took his advice. Texted the parties, told them their multiple different sob stories made me uncomfortable, I didn't want them to have to pay for an app (based on the sob stories they would not have qualified anyway) and we were moving in a different direction. Then I blocked the numbers.

Hopefully the fact that I had two other people ask to fill out apps and tour it within an hour of doing that, means karma is on my side.

Dunno about karma, but that was a good decision to go in a different direction. Not like you were going to lease to them anyway. String good decisions together and do everything you can to mitigate your risk when it comes to tenant selection.

maybe a dumb question, but there seems to be a ton of upside (except the added expense) to having a management company take everything off your plate... screening, collecting, repairs, etc. Thoughts?

To be clear, since discriminate sounds bad, my friend would be considered a minority and those were his words not mine.

I couldn't care less about much more than having someone that will not destroy my property and can reliably pay their rent. Don't need or want drama if I can avoid it.

In my experience with management companies, admittedly not as a property owner, that is probably very true, but the money thing is a real concern as well as finding a really good manager. A lot of managers just plain suck and I think they do more harm than good.

I made significant strides at this time actually getting contractors to do most all of the make ready work. The old me, who knows how to do most stuff and has historically been too cheap and picky to let others do the work, would have had issues with that. Small steps. I figure that with one property, I can handle it, especially with the luxury of leaning on my friend for advice when I need it. It is really only a challenge when finding a tenant. In this case, since everything is basically new in the unit, there shouldn't be a lot of maintenance.

Maybe, if things go as I hope, and we acquire multiple additional properties over the next few years, I might rethink it.

BoDog said:

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maybe a dumb question, but there seems to be a ton of upside (except the added expense) to having a management company take everything off your plate... screening, collecting, repairs, etc. Thoughts?

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If you're uneasy about tenant placement, that is ok, outsource that and then manage it yourself. It is crucial to rental property and the value it adds to you (time, emotions, stress, etc) and your property should outweighs the expense. You have an offer on this thread to pursue that avenue. At least worth looking into.

Fair enough. Any recs for strictly tenant screening and placement?

Zillows rental application is pretty solid.

I always make sure to get credit reports, proof of income (I look for 3x rent), etc.

We use apartment.com for managing payment and that works pretty well. Free on both ends and tenants can setup autopay from their bank.

I think that site can do a bunch of expense management, listing and maybe tenant screening?

I do what you do - zillow seeking tenants, rent payments online via aptsdotcom & credit/background thru them or or mysmartmove paid for by the tenant. Each person over 18 has to do it & it's roughly $40/each. That weeds out tons of people that know they won't qualify.

Every inquiry gets the same reply that states we are accepting/reviewing applications & we include our leasing requirements. If they know can't pass, they don't apply.

Leasing is the absolute worst part of the rental game. Luckily, most of our tenants stay a few years - we have a house open now & it's driving me crazy. Clearly states no animals & most of them have more than one. No one reads - LOL. We are also lucky in that we can hold out for the right person. We made that mistake when we first started - thinking that no one better would show up & overlooking some red flags. We never got seriously bit, but had some tenants that we weren't crazy about.

Probably another dumb question, but can a realtor you list the property with help facilitate the screening. I assume their value add would be a lease agreement as well? TIA!

BoDog said:

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Probably another dumb question, but can a realtor you list the property with help facilitate the screening. I assume their value add would be a lease agreement as well? TIA!

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Yes, My realtor does the rental listing, showings, pre-screening for tenants, applications, parent guarantee (for student rentals), deposit collection, lease documents and packages it all up for me when completed. Fees for this vary by market from 1/2 months rent to 1 months rent..

AgCPA95 said:

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BoDog said:

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Probably another dumb question, but can a realtor you list the property with help facilitate the screening. I assume their value add would be a lease agreement as well? TIA!

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Yes, My realtor does the rental listing, showings, pre-screening for tenants, applications, parent guarantee (for student rentals), deposit collection, lease documents and packages it all up for me when completed. Fees for this vary by market from 1/2 months rent to 1 months rent..

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Does anyone have any DFW agent contacts that do what AgCPA's realtor does?

schwack schwack said:

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I do what you do - zillow seeking tenants, rent payments online via aptsdotcom & credit/background thru them or or mysmartmove paid for by the tenant. Each person over 18 has to do it & it's roughly $40/each. That weeds out tons of people that know they won't qualify.

Every inquiry gets the same reply that states we are accepting/reviewing applications & we include our leasing requirements. If they know can't pass, they don't apply.

Leasing is the absolute worst part of the rental game. Luckily, most of our tenants stay a few years - we have a house open now & it's driving me crazy. Clearly states no animals & most of them have more than one. No one reads - LOL. We are also lucky in that we can hold out for the right person. We made that mistake when we first started - thinking that no one better would show up & overlooking some red flags. We never got seriously bit, but had some tenants that we weren't crazy about.

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What do you do for college students? Screen their parents?

AgsMyDude said:

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schwack schwack said:

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I do what you do - zillow seeking tenants, rent payments online via aptsdotcom & credit/background thru them or or mysmartmove paid for by the tenant. Each person over 18 has to do it & it's roughly $40/each. That weeds out tons of people that know they won't qualify.

Every inquiry gets the same reply that states we are accepting/reviewing applications & we include our leasing requirements. If they know can't pass, they don't apply.

Leasing is the absolute worst part of the rental game. Luckily, most of our tenants stay a few years - we have a house open now & it's driving me crazy. Clearly states no animals & most of them have more than one. No one reads - LOL. We are also lucky in that we can hold out for the right person. We made that mistake when we first started - thinking that no one better would show up & overlooking some red flags. We never got seriously bit, but had some tenants that we weren't crazy about.

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What do you do for college students? Screen their parents?

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Yes, Parental Guaranty from each parent/guardian of student tenant.

MS08 said:

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AgsMyDude said:

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schwack schwack said:

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I do what you do - zillow seeking tenants, rent payments online via aptsdotcom & credit/background thru them or or mysmartmove paid for by the tenant. Each person over 18 has to do it & it's roughly $40/each. That weeds out tons of people that know they won't qualify.

Every inquiry gets the same reply that states we are accepting/reviewing applications & we include our leasing requirements. If they know can't pass, they don't apply.

Leasing is the absolute worst part of the rental game. Luckily, most of our tenants stay a few years - we have a house open now & it's driving me crazy. Clearly states no animals & most of them have more than one. No one reads - LOL. We are also lucky in that we can hold out for the right person. We made that mistake when we first started - thinking that no one better would show up & overlooking some red flags. We never got seriously bit, but had some tenants that we weren't crazy about.

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What do you do for college students? Screen their parents?

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Yes, Parental Guaranty from each parent/guardian of student tenant.

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I also have always done student rentals with joint and several liability so everyone is individually responsible for the entire rent and any damage. I know some folks rent by the room but we have done it that way for 15 years and wouldn't really consider doing it differently based on our history of success with it. We have had a few inquiries (from the parent guarantees) asking to deviate but haven't and have always gone to market soon enough to have others ready to rent under our rules for the upcoming school year.

I use MySmartMove by Trans Union. It works well and has eliminated every prospective tenant who gave me bad/questionable vibes.

AgCPA95 said:

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MS08 said:

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AgsMyDude said:

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schwack schwack said:

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I do what you do - zillow seeking tenants, rent payments online via aptsdotcom & credit/background thru them or or mysmartmove paid for by the tenant. Each person over 18 has to do it & it's roughly $40/each. That weeds out tons of people that know they won't qualify.

Every inquiry gets the same reply that states we are accepting/reviewing applications & we include our leasing requirements. If they know can't pass, they don't apply.

Leasing is the absolute worst part of the rental game. Luckily, most of our tenants stay a few years - we have a house open now & it's driving me crazy. Clearly states no animals & most of them have more than one. No one reads - LOL. We are also lucky in that we can hold out for the right person. We made that mistake when we first started - thinking that no one better would show up & overlooking some red flags. We never got seriously bit, but had some tenants that we weren't crazy about.

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What do you do for college students? Screen their parents?

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Yes, Parental Guaranty from each parent/guardian of student tenant.

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I also have always done student rentals with joint and several liability so everyone is individually responsible for the entire rent and any damage. I know some folks rent by the room but we have done it that way for 15 years and wouldn't really consider doing it differently based on our history of success with it. We have had a few inquiries (from the parent guarantees) asking to deviate but haven't and have always gone to market soon enough to have others ready to rent under our rules for the upcoming school year.

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Yeah we always rent out ours the same way