Property Management. Owner Manual. Presented by. MR Properties

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1 Property Management Owner Manual Presented by MR Properties In Association with Traders Point International Inc San Gabriel Valley 9455 Las Tunas Dr. Temple City, CA High Desert W Sage St. Ste 103 Victorville, CA Hours of Operation: Monday - Friday 9:00 to 5:00

2 TABLE OF CONTENTS Introduction Company Overview Meet the team Section 1: Making your property rentable Set the rent price Prepare the home for the market Items required before putting home on rental market Placing home on market Marketing your home Home Showings Application Process Section 2: Leasing Creating the Lease Agreement Leasing Get the property Rent Ready Section 3: Maintenance Maintenance program & repairs Home Warranty Coverage Repairs when a tenant moves in Preventive Maintenance Programs Placing a service request on your property Section 4: Inspections Move in inspections 6 Month inspections Move out inspections Section 5: Accounting Rent collections Rent payments The Security Deposit Pet Deposit Section 6: End of Lease Extending the Lease Terminating the Lease Early release of Lease Evictions Supporting Documents Sample Lease Old Republic Sample Brochure (Go to link below)

3 Introduction Since 2002, Traders Point International has been providing quality, professional property management to real estate investors and owners throughout Los Angeles County. Our services include managing residential properties and their leasing, maintenance and property preservation services. The owner Randy Mills has been in property management for over 20 years starting with a single family Home back in Tulsa Oklahoma. At that time it was he was a sole proprietor and he steadily grew the business until moving it to Los Angeles area in In 2002 Randy started Traders Point International and started growing the business and in 2005 switched from sole proprietor to a California S Corporation. Now in our 6 year as an S Corp we have always tried to provide the highest quality of service while treating everyone we meet with highest amount of respect and dignity. We now have 4 associates added to our management team by which we can take care of all your needs. We also work closely with 10 Victorville companies and 2 Arcadia companies to provide the highest quality of service available in the Victorville area. Our portfolio of income properties are single family homes in the Victorville area valued at more than $4,500, Whether you are a first-time home buyer, property investor or an experienced apartment owner, Traders Point International and their Associates can assist you with all your real estate needs. Company Overview Property Management Owner Satisfaction guarantee (We only charge management fee if we collect your rent) Tenant retention programs In house Maintenance Preventive maintenance programs On time maintenance services Regularly maintenance procedures (changing A/C filters, Spring and fall tune up of mechanicals (HVAC units, hot water tanks. Stand Alone Services Property Preservation Vacant Property Maintenance Vacant Property Weatherization General Repairs and Servicing of mechanicals Trash outs Board ups Lawn Maintenance Irrigation repair Service and repairs General Repairs Minor construction Painting Electrical Plumbing Cleaning

4 Meet the Team Randy Mills Manager Ken Shung Leasing Agent Frank Murillo Maintenance Javier Gutierrez Lawn and Irrigation Support Companies Luke s Christian Painting Earl s Paint Pacific Garage Doors Diversified Glass Victorville Glass Vern s Glass A Clean Pro (Carpet Cleaning) All Seasons Carpet Care Section One: Making your property rentable Determining the Rent Price: The best time to start marketing your home for rent is 60 days prior to the available move in date. We will develop a detailed market analysis of your to determine what the current rental value of your home is and one of our staff will make a price recommendation. The rent price recommendation will be the highest price that we believe the property can be marketed at and be competitive with the other properties in the area and attractive to potential tenants. After 3 weeks on the market, the price will be reviewed and adjustments may be recommended. After the initial price drop we will review pricing every two weeks. Preparing your home for the market: In preparing your home to go on the market we ask that you inspect paint, floors, appliances, cabinets, vanities and plumbing fixtures, doors, windows, and ensure that everything is in good condition. We will also visit the home and will make any recommendations we find necessary to bring the home to a marketable condition. We can provide any service required to bring the property to Rent Ready Condition. Required items prior to home going on the market: 3 sets of keys (two for the new tenants and one for our office.) Mailbox keys, storage keys and parking space numbers. Payment information sheet. (Bank Information for rent deposit) Copy of the Home Owners Documents. List of utility providers for the property. Copy of Home owners Home Warranty policy (preferably Old Republic ). Summary of information on your home that will help the tenant to familiarize himself with the home.

5 Placing your home on the market: In order for your home to be placed on the market, the home must be picture and showing ready. The home will be visited by many potential tenants and we ask that the best impression be made by maintaining the home clean, clutter free, and welcoming. A bright room shows much better than a dark one, so we request that windows, curtains and blinds are maintained opened throughout the day. Please be sure that if there are pets in the home, the pets are contained to a room or crated so that potential renters can look freely. If the home is vacant than please ensure that the home is free of dirt on walls, trim work, fans, vents etc, it is especially easy to notice a house that is not clean when it is vacant. Bathrooms and kitchens are also very important, please be sure caulking is not peeling or dark, and appliances are all in working order and clean. Air fresheners are a great way to make the house smell fresh. Marketing your home: Your property is presented throughout the Multiple Listing Service (MLS) as it is considered to be the best way of advertising your property to potential tenants and REALTORS that may have tenants seeking a property such as yours. Your property is also marketed through multiple internet sites such as: Rentals.com, Zillow, Hotpads, Trulia, My Properties website and 10 other websites. (My Properties Property Management covers the fees associated with placing ads on websites) Showing the Home: A lockbox will be placed on the home to allow our agents to access the home whether you are home or not. Only agents have a combination to the lockbox to retrieve a key to your home. The lockbox will not affect the way that you open the door to access your home. Showing times will be Monday through Sunday between 10am and 8pm. If the property is occupied then a contact person and phone number will be placed in the system and a request that our agents call and inform the occupant that they will be showing the home. A voic message constitutes notification, therefore please be sure to always check your voic . For your safety, please do not allow tenants to view the home without an agent and always refer them back to us for answers to their questions. Do not negotiate price, lease term, move in dates etc with an agents or tenants that visits your property. If you are in the home when an agent and his or her clients arrive, we recommend that you step out for a walk or just try to stay out of their way and allow them to look freely. It is important that you secure all items of value or keep them out of sight. Application Process: Attracting good qualified tenants is the ultimate goal! We strive to create a good tenant /landlord relationship, and in order to do so we have implemented a comprehensive tenant screening process to help ensure this. All credit history profiles are performed by an independent credit reporting agency and includes:

6 Regular Tenants: Credit report (Includes credit reports, detailed history of open and closed accounts, any collections or judgments, and trade lines), Fraud alert, terrorist list check, multi state criminal and eviction check, current employment verification, current and past residence verification and rental history from prior landlord. Section 8 Tenants: Background screening report (Includes Criminal Background check, address verification, identity verification and eviction report SECTION 2: Lease Creating the Lease: Once a tenant has been accepted, we will create the lease and provide the lease for the tenant to sign. Once the tenant has signed, we will get the lease over to you for signatures. The Standard Southern California Association of Realtors lease is used for all California Leases. The following additional clauses are added to every lease: No smoking inside the property. No pets other than the pets approved on the application allowed. Tenant agrees to pay $60.00 per service call. Tenant agrees to return all keys prior to vacating the home or agrees to pay the cost of replacing these items out of their security deposit. Always keep in mind that until the lease is signed by both parties and a copy is delivered it is not a legally binding agreement. Please always return it as quickly as possible. (Copy of lease attached to end of manual) Lease overview: We are happy to go over the lease with you in detail. Please feel free to contact us by phone or and set up an appointment to go over the lease prior to the property having an accepted tenant that way you are sure to have all of your questions answered prior to the time you need to sign the lease. Preparing your home for new tenant move in: We will make sure that the home is vacant, clean and move in ready prior to the new tenants lease start date. Always cancel utilities (Water, gas, electric) a week before the new tenant s lease has begun because it is unlawful to cancel utilities once the tenant has moved in and is occupying a residence in California. We recommend that you give it a day or two before the lease start date to ensure that the Tenant can have uninterrupted service if they start service right away, however, it is their responsibility to start service. Please remember that the responsibility for the cost of utilities at the home when the property is vacant is the owners and not the property management companies.

7 SECTION 3: Maintenance Maintenance Repairs: It is important to understand that the need for repairs is very likely during the term of the lease. We recommend you purchase a home warranty to assist with these repairs. The Home Warranty has a $60.00 deductible (this is what the warranty charges to send a contractor out to the property). This fee will be covered by the Tenant or the Owner. Most of the repairs that are needed throughout the lease term are covered by the home warranty but when there is an issue that is not covered, we will contact you immediately. All contractors that work on your property are pre qualified licensed and insured repair technicians. Promptly addressing maintenance repairs maintains the tenants happy and prevents minor repairs from turning into expensive major repairs at a later date. You will always be advised of any needed out of pocket repairs and your approval is needed prior to proceeding with the work. (A sample Warranty brochure from Old Republic is attached to end of manual) Repairs within the first 5 days: Tenants have five days after move in to report any issues that they find with the home that need attention or items that they simply wish to have noted on the move in inspection report. Any items listed on the move in report that need repair are repaired at the owner s expense. If items on the inspection report are covered by warranty then the owner is responsible for the $60.00 service fee. You will be informed of these issues needing repair and of your responsibility to pay the $60.00 service fee when applicable. Preventive Maintenance: If you have any preventive maintenance contracts that you wish to continue to hold on the rental property, (at your expense) then please provide them with our contact information and we are happy to set up appointments for them to service the home. Placing a service request on the property: Tenants are instructed to place all service requests in writing either by mail, or through our website s online maintenance request. (www.traderspoint.us) SECTION 4: Inspections Check in Inspections: A thorough inspection is performed prior to the tenants move in. Our property manager will walk the home and document the condition of the home on the move in inspection report. Pictures of the home will also be used to document the condition of the home. We will be looking at walls, floors, appliances, plumbing fixtures, etc. The same report is used at the six month and end of lease inspections. The owner is encouraged to attend this inspection if there are items that you want to point out to the tenant. If you prefer to have us point them out please send us a summary of the items you need us to address.

8 (Inspection report attached to end of manual) Six month Inspections: An agent that is dedicated to performing the six month inspections will contact you once your inspection is due. These inspections are a little less detailed then the move in and move out inspections. During the six month inspection, the agent simple snaps a few pictures of the home and ensures that everything appears to be in working order. The owner is always invited to this inspection but it is not mandatory that you attend. End of lease Inspections: A move out inspection is done within 72 hours of the tenant vacating the property. At this inspection we are checking the condition of the home and determining whether there are any items beyond normal wear and tear. Courts protect the tenant and their security deposit therefore damage has to be significant in order for a court to justify retention of a security deposit. It is a very complicated line to walk, but remember that the cost of court fees and the likely hood of the court siding with the tenant, makes going to court a last resort. As a landlord you should expect to receive your home with some wear from the tenant living in it. You should expect nail holes, minor scuffing, paint refreshing etc. Our tenant handbook is written to encourage tenants to leave the home as clean and marketable as possible and although it is not their legal responsibility the expectations are set high for them. SECTION 5: Accounting Rent Collections: Regular tenants: Tenants send their rent payments to our office. Initially we do not accept personal checks for a period of 6 months (we only accept Cashier s Check, Money Orders or Cash). After that period, if the tenant has paid the rent on time 100% of the time then we will accept payable Traders Point International. Rent is due in our office by close of business on the first of the month, however there is a grace period that allows for the rent to be delivered by the 5th If the rent is not received by close of business on the 5th of the month then a late fee is assessed and if the rent payment is not received by the 10 th of the month then we proceed with filing any necessary paperwork with the courts to document the late payment and eviction process will be initiated if necessary. Section 8 Tenants Tenants send their rent payments to our office. Initially we do not accept personal checks for a period of 6 months (we only accept Cashier s Check, Money Orders or Cash). We also collect payment in person by one of our staff. Rent is due in our office by close of business on the first of the month; however there is a grace period that allows for the rent to be delivered by the 5 th. If the rent is not received by close of business on the 5th of the month then a late fee is assessed. If the rent payment is not received by the 10 th of the month then we proceed with

9 filing any necessary paperwork with the courts to document the late payment and eviction process will be initiated if necessary. Rent payment: For your convenience you can choose one of two options for receiving your rent payments: by check (mailed out to you) or by electronic funds transfer (EFT funds are deposited directly into your account). Security Deposit: At least one month s security deposit is held in an escrow account with the interest accruing to Traders Point International Inc. Property Management: The security deposit is there to provide limited protection to the landlord in case of damage (beyond normal wear and tear) to the property or unpaid rent once the tenant vacates. Please keep in mind that the courts are very protective of the tenant s security deposit and only items beyond normal wear and tear can be deducted. (A landlord is to expect minor cosmetic repairs at the end of a lease such as nail holes, worn paint, scuffs, etc.) The unused amount is then refunded to the tenant Within 21 days of move out. Pet Deposit: Pets will not be allowed without your permission and when they are allowed an additional deposit of $ per pet will be collected. (A special pet addendum is signed by the tenant acknowledging that there are additional responsibilities and liabilities.) SECTION 6: End of Lease Procedures Extending the lease: The lease requires that both the tenant and landlord notify each other of their intent to renew or end the lease at least 60 days prior to the lease expiration date. We ask that you notify us at least 75 days prior to the lease end date if you wish to renew or not. If you are choosing to renew the tenants lease then we will contact the tenant and the tenant wishes to renew then we will be happy to create the addendum and get it signed by both parties. Terminating the Lease: If the tenant notifies us at the 60 day mark that they will not be renewing the lease then, per the lease, you are within your right to place the home on the market for rent or sale during those 60 days. We will coordinate all of this with the tenant once you notify us how you would like to proceed. The home will be made available for showing and the steps outlined in Section 2: rental process of this manual will be followed.

10 Keep in mind that once the current tenant moves out, there may be some work to be done to the home prior to the new tenant moving in. You may need to paint, and get the home professionally cleaned. The carpets will be professionally cleaned by the current tenants but normal wear and tear may be visible and that will need to be corrected by you the owner. If you are interested in selling your home at the lease end date, then per the lease you can place the home on the market 90 days prior to the lease end date. Please notify us about 3 and a half months prior to the lease end date so that we can arrange this. Tenants not completing the lease term. The lease has some clauses that allow for ending the lease early (Please review the sample lease attached) such as the military clause, and relocation clause, however there are times that a tenants personal situation forces them to seek an early release from the lease and the request is not justified by the clauses in the lease. In these situations we recommend working with the tenants. The last thing you want is someone living in your house by force and not feeling as though you are trying to work with them. Offering the tenant the opportunity to get out of their lease by having the home go on the market for rent and holding them fully responsible for the rent, utilities and maintenance of the home until a new qualified tenant is found is an option that works well. The tenant is also charged a fee of a month and a half to cover marketing, and commission fees for failing to comply with the full term of the lease. This gives the tenant an option to resolve their situation and does not put the cost of it on you, the owner. Evictions for unpaid rent: We are able to handle all aspects of the eviction process at the owner s expense (including service of notices and court appearances). The screening process that we use helps us minimize this unpleasant aspect of the business. Our goal is to never have to take this action but we are prepared to do so when necessary.

11 Sample of Lease Agreement

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17 Sample of Property Inspection

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