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Becoming an Auto-Entrepreneur in France

entrepreneurship france

What is an Auto-Entrepreneur?

The scheme was introduced by minister Hervé Novelli under the 2008 law to modernise the economy, and came into force in 2009. It aims to encourage small-scale start-ups and entrepreneurship in France. Auto-entrepreneurs are not required to register with the Registre du Commerce et des Sociétés (Chamber of Commerce and Businesses) or the Repértoire des Métiers (Trade Directory). Registration can be done online, at a Centre de Formalités des Entreprises, at chambres de commerce, chambres des métiers, or URSAFF centres.

Auto-entrepreneurs pay tax and social contributions at a flat percentage rate of turnover (previously, many would-be entrepreneurs were deterred from setting up their own businesses because of high charges and legal obligations in France). Charges are only due where there is income: if turnover is zero, nothing is owed. Most auto-entrepreneurs are also exempt from VAT, as long as their income remains below a certain threshold.

Who Can Register as an Auto-Entrepreneur?

Anyone aged 18 or over who is not already trading as a business can register as an auto-entrepreneur, including students, retired people and employees looking to supplement their income, as long as they belong to an accepted category.

Micro-Entreprise Tax Regime

The tax advantages of the auto-entrepreneur system are available to those who do not charge (or claim) VAT; and who do not exceed the threshold for turnover for their category of business. These thresholds are as follows:

  • €80,000 for businesses selling goods, articles, supplies, food (to take away or eat on the premises) and accommodation services.
  • €32,000 for other activities.
  • €32,000 for services that are taxable under BNC (bénéfices non commerciaux; this mainly applies to professions libérales.

Taxes and charges are calculated as percentages of turnover:

  • Businesses selling goods, articles, supplies, food (to take away or eat on the premises) and accommodation services: 13% (12% in charges + 1% income tax)
  • Other activities: 23% (21.3% in charges + 1.7% income tax)
  • Services that are taxable under BNC: 20.5% (18.3% in charges + 2.2% income tax).

ACCRE: Financial Help for Auto-Entrepreneurs

ACCRE stands for aide aux demandeurs d’emploi créant ou reprenant une entreprise. Would-be auto-entrepreneurs who are unemployed or under 25, for example, may be eligible for a reduction in social charges during the early years of their micro-entreprise. Information can be obtained from the APCE agency.

The Best Strategies to Avoid Foreclosure: Sound Plans for to Prevent a Mortgage Default

With the holidays coming up, homeowners will be stretched financially. Foreclosures rose to unprecedented levels in 2016 due to the loss of jobs and the steep decline in real estate values. Banks and mortgage companies also face the strains of a tough economy. Stressed homeowners should consider the following strategies to avoid being evicted from their home during this holiday season.

Proactively Call the Mortgagor/Bank

The best strategy to avoid foreclosure is to call the bank before a payment is missed. Borrowers, who let the bank know they have lost their job or face some other serious financial strain, will be more likely to get relief if they call before they are behind in their payments. While there are lots of items to be concerned with when a job loss occurs, “call the mortgage company” should top the list.

Compose Assets and Liabilities

Think like a business here. The faster a borrower can provide the bank or mortgagor proof that he/she faces financial hardship, the easier it will be to get some relief. Taking a half day to gather all sources of income and sources of expenses will go along way. Be prepared to send out multiple copies of the latest documentation (i.e., paystubs, bills, canceled checks, etc.).

Keep Records of Bank Contacts

Be patient, but persistent once the information is sent to the institution. Borrowers should keep a regular record of exactly who they talk to at the bank and when they called them. A good paper trail can help the bank stay on to of their records. Don’t be surprised if the people at the bank are frustrated and overwhelmed. Many banks were not prepared for the sheer number of people that would be calling and requesting modifications.

Be timely with all requests. Any requests for information should be completed the same day or the next day. Remember, the sooner the bank receives the information, the sooner the borrower can receive some kind of relief.

Be Open to All Options (Short Sales, Deferred Interest, Reduced Rate, etc.)

Most banks are willing to work with borrowers in good times, so it should be no surprise that they are willing to offer borrowers a variety of solutions to their problem. If the set back is temporary, they may consider changing the loan to interest-only for a period of three to six months. If it seems longer-term, the bank may suggest a short sale. Be open to all options. Even if a borrower has to sell their home at the bank’s request, they still maintain a good credit rating and have the opportunity to move to a place that they can afford.

Always be patient and kind. Remember, the borrower needs the bank much more than the bank needs the borrower. Additionally, banks are understaffed and that staff is definitely overworked. Be willing to explain the situation as many times as necessary and be timely with documentation. These strategies should help most troubled borrowers avoid foreclosure.

New Short Sale Program Can Benefit Investors: Federal Push for Foreclosure Alternative Means Buying Opportunities

Investors in property who have several years of experience and are committed to their real estate investment plans are always alert to opportunities to add to their portfolios. They do not hesitate to pursue alternative ways to acquire properties at good prices because they always remember the real estate adage that profit is made at the time of purchase – in other words, profit is ensured by paying the lowest price possible for a piece of real estate.

In the United States, enterprising investors are about to get a helping hand from the federal government, albeit indirectly. As its name suggests, the Home Affordable Foreclosure Alternatives program (HAFA) which took effect April 5, 2010, seeks to discourage foreclosures. The program provides incentives for lenders to accept deeds in lieu of foreclosure and also encourages more property owners who are in arrears in their mortgage payments and more lenders that hold those mortgages to participate in short sales.

How and Why HAFA Encourages Short Sales

In real estate, a short sale occurs when a mortgage debtor sells his or her property for less than is owed on the mortgage and the lender has consented to accept that amount. In a traditional short sale, the debtor must agree to pay part or all of the balance that remains due on the mortgage after the proceeds of the short sale have been applied to the debt.

As explained on the HAFA Web site, owners who engage in a short sale under HAFA and lenders that consent to it must accept the proceeds of the sale as payment in full of the underlying debt.

The federal government has estimated that the value of about 11.3 million U.S. homes is less than what is owed on their mortgages. The government also believes that more than 5 million households are in arrears on their mortgages and at risk for foreclosure. HAFA offers mortgage debtors who meet certain requirements the short sale as an alternative to walking away from their homes and handing over the keys to their lenders or going through the foreclosure process.

According to David Streitfeld in his New York Times article “Program Will Pay Homeowners to Sell at a Loss,” under HAFA, lenders will use real estate agents to determine how much a home is worth, that is, the minimum that a lender will accept. This figure will not be revealed to the homeowner-debtor, but if an offer is made for the property at or higher than the acceptable minimum, the lender is obligated to consent to the short sale.

Traditionally, lenders were cool to the idea of short sales and preferred to take possession of properties through the foreclosure process rather than accept less than the amount owed on a mortgage. But the burst of the housing bubble resulted in a glut of homes on the market, going unsold for months and even longer. This in turn has meant that lenders have much larger inventories of homes (real estate owned or REOs) on their books and for longer periods of time.

The HAFA guidelines specify that every homeowner-debtor who may qualify for the program must be considered for it before the delinquent loan is referred to foreclosure or the lender allows a pending foreclosure sale to proceed. HAFA also allows $1,000 from the sales proceeds to lenders for administrative and processing costs, and $1,500 to the seller as relocation assistance.

The Post-Foreclosure Phase and REOs: Properties Taken Back by Lenders Offer Buying Bonanza for Investors

After a property in the United States has been auctioned by a county sheriff or other court officer for the unpaid balance of a mortgage, and after the statutory redemption period has ended, the former owner loses all rights and claims to the property. This is known as the post-foreclosure phase.

If a real estate investor was the successful bidder at auction, he or she now can fix up the property, use it as collateral for loans, and even sell it like any other investment property. If the mortgage lender that initiated the foreclosure proceedings was the successful (or sole) bidder at auction, the property belongs to the lender.

Real Estate Owned (REO)

When a lender obtains title to real estate that had served as collateral for a mortgage loan, the property is designated real estate owned (REO) on the lender’s books. The lender considers REOs to be nonperforming assets, in other words, assets that accrue or return no interest or other income.

No lender wants a glut of REOs on its books. Similar to the “toxic assets” so often mentioned in the discussion about the current state of the banking industry, REOs are a drag on a lender’s value. Not only do they not produce any income, they cost the lender money to maintain.

Lenders Manage REOs

It used to be that lenders virtually ignored the condition of their REOs. The properties would sit empty and neglected, sometimes for years. Times changed and new realities set in. With the rate of foreclosures at record highs, mortgage lenders are getting stuck with larger inventories of REOs. At the same time, because of the record amount of homes on the market these days, lenders have started to realize that if their REOs are to compete for the attention of the small number of available buyers, the REOs cannot fall into severe disrepair.

Still, pouring money into the upkeep of a nonperforming asset is no guarantee to the lender that an REO will sell soon or at all. This situation produces opportunities for real estate investors who want to add properties to their portfolios at below-market prices and who are financially prepared to take an REO off a lender’s hands.

Advantages REOs offer to Investors

Unlike bidders at foreclosure auctions, investors who are interested in REOs are able to inspect the properties. If repairs are needed, investors can negotiate with the lender-owners over this issue. There are two other key advantages to buying post-foreclosure property from a lender. To pass title that is free and clear to the buyer of an REO, the lender-owner must arrange for the removal of any secondary liens on the property. Moreover, before placing an REO on the market, the lender-owner must evict any occupants on the property.

Although these proactive steps by lender-owners add to the price of an REO, many investors welcome the freedom from the uncertainty, time, and expense that those steps represent and that are not present in the pre-foreclosure and foreclosure phases.

Finding REOs

Many lenders do not advertise their REOs. Instead, they may dispose of their REOs by means of specific real estate agents or networks of private investors. For the novice investor in foreclosed properties, it is advisable to develop relationships with various lenders to become part of such a network of private investors. It is also prudent to cultivate relationships with real estate agents and brokers who specialize in marketing REOs.

There are also many online services that list bank-owned REOs (some for a fee). These services are readily found by searching the term “finding REO properties.” However, these listings may not be updated as frequently as an investor may want.

For a good guide to the foreclosure process, see HGTV’s frontdoor.com, which includes video clips.

Effective Marketing Vital For Real Estate Agent: How Good Photography Can Help Sell A House

An online magazine spoke recently with Aaron Ewer, a young real estate agent working in Halifax, NS, since 2006, about how he markets himself, why having good photography skills can help sell houses quickly and why his age doesn’t affect his business.

When asked what his best marketing plan or strategy for attracting a potential home owner was, Ewer said with each listing, he tries to imagine what the buyer is thinking.

“I think about what will be important for them to notice about the property and accent it both in the photos and the property description,” he said. “It’s almost certain that the buyer will find the property online, so having a solid web presence is essential.”

Having Good Photographs Of Houses Helps Them Sell Quickly

Having effective advertising is essential for a real estate agent, Ewer said, adding that he markets himself through previous clients and through his own website.

“I am very fortunate to have a great group of clients who are willing to refer me to their friends and family,” he said. “I try to keep in touch throughout the year whether by mail, e-mail, phone or going out for coffee.”

Ewer said he’s attempted some Facebook advertising which works great when promoting properties, but admits when he tries to advertise by himself, it falls flat.

Referrals Are The Best Form Of Advertising

“It proves to me over and over again that referrals are the best form of advertising,” he said. Ewer is also an avid photographer who shoots the houses he sells.

“I work hard at perfecting my photography skills since it’s the first thing most buyers will look at when browsing through real estate,” he said. “With so much competition, it’s important for me to always find a way to have my listings pop out to potential buyers as they sift through listings online.”

Through the last couple years, Ewer said he has discovered what shots work, and what don’t.

“I’ve moved beyond a few snapshots of a house to focusing on capturing the unique quality of each home,” he said, adding that he will spend hours re-arranging furniture and adjusting lighting to get the perfect picture.

Starting a Real Estate Career

Ewer began his career by coordinating the marketing for a Halifax real estate firm.

“The position involved a lot of design and photography, but most importantly allowed me to job shadow some of the most experienced agents and learn how the industry works,” he said. “About eight months later, I got my real estate license.”

Ewer said the top three things that separate him from competition are:

  1. His marketing approach
  2. His age
  3. The company he works for

Ewer, 24, said he hasn’t noticed people choosing competitors over him because of his age.

“I’m sure there are some who are skeptical. The way the industry works is so heavily based on referrals that most of my clientele is coming from previous satisfied clients,” he said. “I work hard on just being confident in my job, and doing what it takes to put deals together.”

Investing in Foreclosures: How to Avoid Losing Money Buying Foreclosed Properties

The current spike in home foreclosures is spurring a new wave of real estate seminars on making money buying these distressed properties. The advertisements make it sound as if the investment opportunities were never better.

But a closer examination of the real estate market reveals that in both good times and bad times, foreclosures can be profitable for the experienced real estate investor and perilous to the neophyte. An abundance of foreclosures doesn’t change that.

The first thing to realize is that in many areas facing rising home defaults, there are more homes for sale than there are buyers. That’s why owners are defaulting – because they can’t sell their house for enough money to pay off their mortgages. When you take over from the defaulting owner, you’ve inherited the same problem.

Another notion the neophyte investor needs to dispel is that buying a house for $150,000 in a neighborhood of $200,000 homes doesn’t necessarily mean you’ve found a bargain. The homes that are not for sale may have been worth $200,000 a short while ago, but the houses that are actually changing hands now are truer indicators of the neighborhood’s present value.

Something else that may catch the inexperienced off-guard is the sizeable expense associated with the purchase, repairs, loan payments, and selling costs. Even if nice homes in the neighborhood actually do sell in the $200s, you could potentially have spent your entire expected windfall by the time you close escrow to liquidate your investment.

If you’d like to try your hand at residential real estate investing, here are some things you should know about how professional investors succeed with any type of property, including foreclosures.

Able to Evaluate Accurately

First is a keen sense of the local market and relative home values. The pros have looked at hundreds of homes, tracked selling prices in comparison to home size and features, and have disposed of many dozens of homes accumulating their share of mistakes and painful lessons learned in the process. They also know different neighborhoods have different rules. They tend to specialize in particular areas or types of neighborhoods.

Grounded in Reality

In a word, professional investors are realists. They don’t fall in love with the house, or the neighborhood and they don’t rely on the lofty pitches of the real estate agent. They do their own homework and make their offers based on past experience, current market data, and well-researched number crunching,

Prepared to Pounce

When submitting an offer, the professional can often win the bid with a lower offer because the pro already has a mortgage broker with financing lined up, is able to act quickly, and has a history of closing deals on time. Some sellers will take a lower price if they feel much more confident of getting their money sooner, compared to accepting a higher offer from someone who doesn’t have their financing yet, or who has to sell another home before closing, or who is an inexperienced investor who may get cold feet. The pro knows this and uses it against other bidders to win deals at better prices.

Know How to Showcase

Professionals usually have an edge when it comes to preparing the property for sale. They know where to spend the money and where not to waste it. They usually have their favorite contractors and suppliers (or they manage much of the work themselves). They know what needs to be done and how much it will cost to make the home marketable with the highest return on investment. And they generally turn the house around with less cash invested, and put it back on the market quickly to avoid making any more loan payments than they have to.

Do Their Own Marketing

Putting the prettiest face possible on the property is just one facet of marketing the professional has wired. When it comes time to actually list the home, the pro also doesn’t rely solely on the efforts of the real estate agent. In fact, it’s not difficult to make a deal with an agent who will put the property on the Multiple Listing Service and handle all of the paperwork of the sale for a very low commission in return for the owner handling all the advertising, print collateral, open houses, and showings. The pro is motivated to move the property quickly to minimize interest expenses.

Conclusion

The intent of this article is not to discourage you from pursuing foreclosed properties as potentially good real estate investments. Rather, it is meant to help open your eyes to all of the things necessary to avoid losing money at it.

If you have the chance, getting the advice of a pro before leaping on your first property is a great way to minimize costly mistakes.

The Redemption Phase After Foreclosure: Investors Must Determine Prudence of Buying at Auction

In the United States, homeowners in roughly half of the 50 states have a statutory right of redemption. This means that a law allows individuals who did nothing to stop foreclosure on their homes one last chance to get back their property. Depending on state law, the redemption period terminates before the foreclosure auction or can last several months or up to one year after the property has been auctioned for the unpaid mortgage balance and accrued interest. During the redemption period, the owner can stay in the home without fear of eviction, and often does so without paying anything during the occupancy.

Uncertainty for Successful Foreclosure Auction Bidder

The statutory right of redemption can wreak havoc with the plans of a real estate investor who is the successful bidder at a foreclosure auction. Not only is the investor barred from evicting the former owner during the redemption period, depending on state law, the investor may not receive title to the property until the end of the redemption period. Without title, the investor cannot put the property on the market or obtain lender financing to fix up the property. Even if the law allows title to pass to the success bidder, the former owner may get back the property by paying the investor the full amount of the bid plus any costs incurred in the auction process.

Investors should beware of the savvy homeowner. A foreclosure wipes out most secondary liens on a property; a homeowner who knows this may choose to wait to redeem the property after foreclosure instead of trying to stop the foreclosure and being obliged to pay all of the creditors who have liens on the property.

Novice real estate investors may fail to understand the uncertainty caused by the statutory right of redemption. They may spend time and money on repairs only to lose a property to the former owner who somehow finds the funds to redeem it- or to another investor who bought the right of redemption from the former owner (see below).

Buying the Right of Redemption

Many investors in states that provide a statutory right of redemption find it advantageous to buy the right from a homeowner, either after or instead of buying a property at a foreclosure auction. The ability to do this depends on whether state law allows the homeowner to sell or assign the right of redemption. Thus, the investor may convince a homeowner to accept a few thousand dollars in exchange for leaving the property and surrendering the right to redeem it.

Finding Properties in the Redemption Period

Investors can readily determine which properties in a given area are in the redemption phase. Investors can review the public records at the courthouse where the foreclosure auctions take place and calculate the termination of the redemption period. Alternatively, investors can read the legal notices of foreclosure sales in the local newspapers or subscribe to services that provide listings of properties that are set for auction on specific dates.

Real Estate Investment Dream Team: Advice from Experts Can Lower Costs for the Real Estate Investor

Before plunking down money for a property, real estate investors must ask themselves many questions, such as whether the tax write-offs for a particular property will boost the return on investment (ROI) and whether the area in which a property is located will mean higher property insurance premiums. When deciding whether to sell properties in their portfolios, investors face questions about the timing and characterization of a sale, among other things. Unless investors have the expertise to answer these questions, they should include tax professionals and insurance agents — not just real estate agents and lawyers — on their team of experts.

Tax Advisers and Real Estate Investment Plans

Before putting a property purchase or sale in motion, an investor should consider speaking with a tax professional. Advisers such as tax attorneys, certified public accountants, or other tax experts who have experience with real estate investing are excellent sources of information about the types of investments that fit an investor’s particular investment plan and capabilities. The tax adviser should be familiar with the tax laws of the jurisdiction in which the investor’s property is located.

Competent tax advisers can help can help an investor’s bottom line by recommending specific strategies for buying or selling property, such as:

  • Owning property as a specific type of partnership or corporation
  • Selling property outright or over time by taking back a mortgage
  • Structuring a sale as a 1031 tax-deferred exchange, in which the investor delays payment of the capital gains tax on the sale of one property by buying another property of the same kind and of at least equal value

Tax laws are extremely complicated and always changing. Understanding the various tax laws and rules and how they interplay is beyond the ability of most non-tax professionals. For these reasons, the smart investor does not hesitate to make a competent tax professional a permanent member of the team of experts.

Insurance Agents, Real Estate Operating Expenses, and ROI

The cost of premiums for fire and liability insurance on a property is often overlooked by investors when trying to estimate the ROI on a property. An experienced, independent insurance agent – which means that the agent is not committed to only one insurance company – is ready to disclose what insurance companies consider to be an insurable risks and the range of premiums charged by insurers in particular areas. This helps the investor make an informed decision about whether to avoid certain areas because of the high premiums charged.

An insurance agent also helps an investor look at a neighborhood from the perspective of the insurer. For example, out of concern about declining property values, some insurers are reluctant to issue policies for properties that are near boarded-up buildings or on streets where there are several “For Sale” signs.

An insurance agent will also ask the investor to find out certain facts about a property, such as the age of the building, roof, heating system, and hot-water heater, and the dates when the plumbing and electrical systems were last upgraded. Some of this information can give leverage to the investor when negotiating with the seller about price or concessions.

With the assistance of an insurance agent, an investor can also find a comfortable level of deductibles and determine which type of insurance coverage is either indispensable or unnecessary for the location and type of property involved.

Optional Members of the Real Estate Investing Team

A real estate investor may also want a mortgage broker or lender, an appraiser, and a title insurer on the team of experts on an ad hoc or even permanent basis.

Timeshare Presentations: Is Purchasing a Timeshare a Smart Thing?

A typical timeshare arrangement is entitlement to stay at a resort (usually one week) or another resort in the timeshare family in exchange for a negotiated price. The sales justification made by the resort is to provide frequent travelers luxury accommodations at a reduced cost. In addition, since it’s considered a second home, it’s possibly a tax deduction. But is buying a good idea?

In Janet Wickell’s article Time-Share Ownership Variations on About.com, she explains the various types of timeshares:

  • Fixed Unit, Fixed Week, with deed
  • Floating Time Agreement
  • Right-to-use (basically a lease with an ownership end date)
  • Vacation Club, points based program

Timeshare Pitch

According to a couple who recently took advantage of an offer at an Arizona resort, their 90-minute timeshare presentation stretched to a three hour pitch session. The resort offers timeshare memberships through Interval International, and allows a timeshare destination exchange to another resort in the Interval International family.

The couple stayed one night in one of the resort’s master suites which had a jetted tub and full kitchen. They received gift certificates for $75 worth of spa services, $25 to Target and were promised a free dinner, which they never actually got. (The resort was still under development, so there were no restaurants on site.) They enjoyed the stay, the weather was beautiful, but they didn’t purchase.

Timeshare Negotiations

For this couple, the negotiations for the timeshare started at $20,000 for one week in the Junior, one bedroom suite. The final offer was $10,000 for the Penthouse Master, one bedroom suite, or a purchase of both suites (the Penthouse Master and Junior are adjacent) for an additional $6995, which would mean two suites for $16,995.

The timeshare ownership came with additional costs. There was an annual HOA fee of $746.00 (for the two units), subject to change at the resort’s discretion. And, in order for them to be able to exchange their week’s stay in Arizona for say, Hawaii or London, they would have to pay an additional annual fee of $50.00 and a trade fee of $140.00 – $160.00, amount dependant on exchange destination.

Using the Timeshare

At this interval timeshare, members may use their week according to an availability calendar, and have the option to rent out their week if desired. They are eligible for discounts on stays at any of the resorts in the timeshare network.

Timeshare Purchase Declined

The couple interviewed explained that they decided against purchasing because they:

  • Worried what might happen if the resort went bankrupt
  • Wondered what price current timeshare units might be reselling for
  • Wanted to compare purchase costs against renting a timeshare
  • Didn’t want to have a mandatory vacation expense and feel forced to go on vacation, even if they had personal cash flow issues or health problems.
  • Learned that financing the timeshare was at a high interest rate.

In conclusion, the couple decided to do more research to determine how to best use the timeshare concept to their advantage, not to add to their expenses. They discovered timeshare ownership alternatives on numerous websites. One such website is Timeshare Adventures which has timeshare listings for sale or rent. The couple compared the costs of buying vs.staying at a resort or renting another timeshare. Both options seemed better for them than this particular timeshare offer.

In times such as these, any new debt should be seriously contemplated and all alternative options considered. Luxury resort stays beckon to the weary, but could end up being a financial noose around the member’s neck.

Written Records Help Landlords Handle Tenants: Documentation Protects a Rental Property Owner’s Interests

When it comes to owning and managing residential rental properties, landlords must tread carefully. Tenants enjoy many protections under state landlord/tenant laws and local ordinances, and landlords who fail to comply strictly with their statutory and regulatory obligations risk exposure to hefty fines or costly litigation.

As discussed in Success as a Landlord – Recordkeeping, accurate and complete records help an owner prevent small misunderstandings with tenants and government authorities from becoming full-blown disputes and buttress the owner’s position when conflicts do arise. For these reasons, landlords will find it beneficial to commit to writing their transactions with tenants and to keep these writings in up-to-date files.

Leases, Landlord Rules, and Tenant Files

Landlords should have applications for completion by those who are interested in renting units from them. Once the landlord selects a tenant, a written lease should be provided for signature by both parties. The lease sets out the terms and conditions of the rental and is the basis for any proceedings against the tenant, should the need arise.

To promote the cleanliness and safety of their rental properties, landlords can establish reasonable rules for their tenants to follow. These rules can cover matters such as when trash and recyclables must be placed on the curb for pick up, what time loud music must be turned down, and the need to keep the front door locked at all times. The rules can be incorporated in the written lease or copies of them can be given to the tenants listed on the leases.

Looking up the history of a rental unit or of a past or present tenant is also made easy if the landlord keeps a file on each unit and each tenant. This type of information comes in handy in legal proceedings against a tenant or when a landlord must deal with government authorities with regard to a tenant or the condition of a unit.

Rent Collection, Tenant Notices, and Vacating Tenants

These are some other ways in which accurate records help a landlord:

Rent collection. In a dispute about rent, the person with the better records is usually victorious. Therefore, a smart landlord keeps a record of when each tenant paid rent and whether the payment was late or on time.

Notices to Tenants. When a tenant is in breach of the lease, the landlord should be prepared with a system that involves warning the tenant in writing (but not e-mail, which may not satisfy a court) of the breach and of the amount of time that the tenant has to correct the situation. If the tenant fails to meet that deadline, it is a good idea to send out a second notice marked as such. If the tenant still fails to comply, the landlord can initiate a court action against the tenant (depending on state laws).

Confirming unit condition. Before a tenant moves out, the landlord must arrange for a final walk-through of the unit. This gives the landlord and the tenant the opportunity to compare the current condition of the unit with photographs, a checklist, or other method used to document the condition of the unit when the tenancy began. This can help support the landlord’s demand for all or a portion of the security deposit to cover the expense of repairs.

Enjoying the Role of Landlord

Having a system in place for handling questions or problems that arise is a fundamental way in which landlords develop confidence in their ability to manage their properties. If necessary, landlords can seek guidance from their attorneys. Landlord associations are also good sources for up-to-date forms, education, and connecting with those more experienced in managing rentals and tenants.

With fewer conflicts and increased confidence in the ability to handle whatever happens, investors in residential rental property will have less anxiety and may even come to enjoy the role of landlord.