The current housing market has many realtors working with both landlords and tenants to help people find homes. While realtors would of course prefer to help people sell and purchase homes, working with landlords and tenants is a good way to develop potential future business - that landlord may want to sell the home or purchase another investment property at some point or that tenant will likely want to buy a home in the future. As a result, providing as much value to your rental clients as you can is a good way to ensure future business.
As a landlord tenant attorney who works with many non-institutional landlords and their tenants, I unfortunately see a lot of cases where realtors failed to take advantage of this opportunity. While a broken relationship between the landlord and the tenant may not be the realtor’s fault, there are things you can do to facilitate a positive relationship or resolve disputes - things that will put you at the top of their list when it comes time to sell or purchase.
Realtors Representing Landlords
Many realtors will help landlords by listing the property, accepting applications, and showing the property to prospective tenants. Aside from showing the property, the role of the realtor becomes largely administrative. If you are a realtor who works with landlords, here are some easy ways to add value to your relationship by minimizing potential problems in the future.
Review and Verify the Application Information
I have had cases where the realtor collected all of the appropriate information but no one really gave the information careful consideration or took the time to make sure it was correct. Verifying the information provided and identifying potential challenges in the event of default can help your client make an informed decision.
For example, I had a case where the rental applicant didn’t intend to reside in the home. Instead, they were applying on behalf of their soon-to-be ex-spouse who had terrible credit. All of this came to light months later when the tenant defaulted on the rent. The applicant resided out of state, making it difficult to pursue them. The tenant residing in the property was unemployed and depended on the ex-spouse to pay the rent. Had the realtor verified the applicant’s employment information, they would have discovered that they were no longer employed locally and had been residing out of state for the past 12 months. This would have saved the realtor’s client several thousand dollars of unpaid rent.
Make Sure the First Month’s Rent And Deposit Are Paid
I have seen different variations - sometimes the first month’s rent and deposit are paid directly to the landlord, sometimes to the realtor, and sometimes one to the landlord and the other to the realtor. However you handle it, there can be some confusion as to who is collecting what.
I recently had a case where the tenant failed to pay the first month’s rent, an issue the landlord didn’t notice until months later. Apparently, their understanding was that it was supposed to be paid to the realtor along with the security deposit. This may have been a misunderstanding by the landlord, but a simple phone call prior to or shortly after move-in could have prevented the problem.
Check for Judgments
Did you know that Virginia court records are available online? If an applicant has been evicted or sued for non-payment of rent, the general district court has exclusive jurisdiction over those cases. Choose the jurisdiction you want to search (the counties where they previously rented, e.g. Loudoun County or City of Alexandria) and then enter the tenant’s name. I have had numerous cases where we quickly discovered that the tenant had prior unsatisfied judgments against them. The landlord would have never rented the property to the tenant had they known that they had previously failed to pay rent.
Provide Perspective
Many non-institutional landlords are very protective of their rental properties. As a result, they can sometimes see relatively minor issues as major issues. This is particularly the case when it comes to damage to the property. If you stay in contact with the landlord, you can serve as a sounding board and provide meaningful perspective that prevents conflicts from escalating or taking a position that exposes them to potential legal liability.
Calendar Renewal and Termination Dates
An easy way to generate future business is to put a reminder on your calendar of any important date such as when the automatic renewal or termination dates are approaching. Many landlords will fail to track these dates on their own, resulting in leases that automatically renew or convert to month-to-month tenancies. A phone call or an email to the landlord can save them a great deal of headaches later on. You can also use it as an opportunity to discuss things like whether they should increase the rent and when it may be the right time to sell.
Be a Resource
Many landlords find themselves feverishly googling answers to their questions when problems arise. Most realtors I know have an extensive network of contractors and professionals who can provide whatever help their clients need. Make yourself your client’s go-to resource for whatever issues may come their way.
Be an Advocate
As a realtor, you are an experienced negotiator - a skill set that is invaluable in a variety of situations. If your client and the tenant are in conflict, assisting your client by negotiating a favorable resolution can save your client time, frustration, and money.
Keep Hard Copies of Everything
Everything is electronic these days, which makes it much easier to get leases signed. I have had issues, however, with landlords who didn’t actually download the documents and are now dealing with an expired link. While we have always been able to get the necessary documents eventually, forwarding a downloaded PDF via email could save a significant amount of time and effort. Keeping a copy for your own file that you can easily produce can also create a favorable impression months after the initial transaction.
Move-in Inspections
I have seen many situations where this gets skipped, and as a result, the landlord later has issues proving their damages. If you are not involved in the move-in process, explain the importance of the inspection in the event of future damages and emphasize the importance of documenting the inspection in writing. Providing the landlord with a move-in inspection form that must be signed by the tenant is an easy way to help your client protect their interests.
Consider a “Rental Toolkit”
To be blunt, many non-institutional landlords do not know how to go about managing their rental property. Providing your client with some simple forms such as ledgers for tracking rent payments, move-in/move-out inspection forms, and 5-day pay or quit notices can help your client better manage their investment.
I realize that this sounds like a lot of work for not a lot of money, but keep in mind that many landlords blame their realtors when their tenants become problematic. A little bit of extra effort and communication from the realtor could deliver tremendous value to their client and guarantee their business in the future.
Realtors Representing Tenants
For realtors working with tenants, many of the things you can do to enhance your value to your client mirror the advice above. Generally speaking, you want to look for ways to reduce future issues and be available to your client when conflicts arise.
Move-in Inspections
Personally, I would not let my client move in without a carefully documented move-in inspection. If you cannot attend the move-in inspection, take a few minutes to discuss with your client over the phone what they can expect and what they should require.
Be a Resource
Realtors can be a resource for tenants, just like they can be a resource for landlords. Many tenants find themselves in difficult situations and are not sure what to do. As a realtor, you have a wealth of experience and knowledge and can probably at least get them pointed in the right direction. Make it clear to your client that they can call or email you at any time if they have any questions.
Schedule Check-Ins
An easy way to be a resource is to send them a personal email every two or three months, just to check in and see how things are going. It’s easy marketing for you and gives them the opportunity to get the help they need before a difficult situation gets worse.
Calendar Important Dates
In my experience, tenants rarely pay attention to automatic renewal provisions. This can lead to obvious conflict with their landlord when they miss the deadline but plan to move elsewhere. An email or a phone call can help your client avoid a difficult situation. I would also recommend calendaring the termination date - I have encountered situations where tenants don’t quite understand that they need to be completely moved out by that date or that the landlord may not want to negotiate a new lease when they have already planned on re-renting or selling the property.
Move-Out Inspection
Similar to the move-in inspection, take the time to at least explain the importance of the move-out inspection if you cannot be present. Make sure that they understand what to expect and when they can expect a refund of their security deposit.
Work with an Experienced Landlord Tenant Attorney
Many of the cases that I handle come to me at a point where there are no options left. Had the landlord or the tenant sought advice from you or from an attorney early on, a better resolution may have been possible. Realtors often have the knowledge and experience to help, but I also recognize that they do not always have the answers to the legal questions that are involved in these conflicts. Establishing a relationship with an attorney you can call with questions can help you deliver greater value to your clients. Whether it’s a minor issue or a major conflict, call or email The Herndon Law Firm for a free initial consultation.
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