In this week’s podcast, Andrew Schultz discusses rental property damage whether it’s done by a natural disaster like a storm or possibly your tenants.
Yikes! You posted an ad for your rental and now you have twenty qualified tenants that match your criteria perfectly. How do you handle the situation?
And, last, but not least, what gets rid of tough mold? And, how can the landlord prevent mold in the first place? Find out now in today’s podcast.
Show transcription:
Andrew Schultz: (00:00)
Hey everyone. Welcome back to another episode of the Rent Prep for Landlords podcast. This is episode number 425, and I’m your host, Andrew Schultz. On today’s episode, we’re gonna be talking about dealing with multiple qualified applicants, working with restoration companies, and mold prevention products. We’ll get to all that right after this.
Voice Over: (00:24)
Welcome to the Rent Prep for Landlords podcast. Now, your host, Andrew Schultz.
Andrew Schultz: (00:29)
The Rent Prep for Landlords Facebook group is over 14,000 members. Our group members get access to our Sherwin Williams and PPG Paint Discount Programs can ask questions in our monthly AMA sessions and much more. So if you have a question or a situation that you’ve never encountered before or just need to bounce an idea off a huge group of housing providers, this is the place. If you haven’t checked it out yet, do it today over at facebook.com/groups/rentprep, and don’t forget to mention the podcast when answering the questions so we know how you found us
Voice Over: (01:05)
Forum quorum, where we scour the internet for ridiculous posts from landlords and tenants.
Andrew Schultz: (01:13)
We’re gonna kick things off this week with our forum quorum segment. This one was actually a right into the Rent Prep website, so that’s actually another way that you can submit questions and they may get picked up for the podcast or for the AMA session. We’ll go ahead and jump right in here. What do you do if you have multiple applicants from an open house that submit the same day and meet the benchmark criteria? Can you choose which one to offer the least to, and if so, what do you say to the others in the adverse action letter? My concern is a lawsuit that denies a qualified applicant. So we talk a lot about tenant screening, which makes sense because Rent Prep’s a tenant screening service, but also because tenant screening is one of the most critical parts of operating a rental property, at least in my opinion, selecting the wrong tenant can lead to months of lost rent, property damage, legal fees, and so much more That nailing the tenant selection process is super important for the short and long-term health of your asset.
Andrew Schultz: (02:10)
It sounds like you’re moving in the right direction. You have a set of tenant selection criteria and you’re comparing every application against that same set of criteria, assuming your criteria are fair housing compliant, that’s a lot of the problems solved right there. Where I see a lot of landlords get into trouble is not having a standardized set of criteria that they’re using and fair housing law violations are no joke. The fines are insane. It’s awesome that you ran an open house and ended up with multiple approved applications. As a result, it’s nice to have choice versus having a unit that sits for a while where the applicant quality isn’t quite as high or you’re having trouble finding people that meet the requirements altogether, but you may not be able to just choose any applicant from the bunch that you have there. Depending on the laws in your area, you may be required to accept the first approved application regardless of if that’s the best application of the bunch.
Andrew Schultz: (03:00)
I believe Seattle has this law in place currently, and I’m sure there are a couple of other areas as well. So you do need to do a little bit of research on this to see if this is something that will impact you. You may be required to keep the applications in order by the date the application was received or the date that all the information is received to process the application or the date the application’s approved, et cetera. You need to know what the lay of the land is in your area so that you know that you aren’t violating any laws without knowing. Moving on from situations where you are regulated and how you have to proceed. The more typical scenario is that you as the property owner will get to decide how to approve your applicants, and there are two main schools of thought on this.
Andrew Schultz: (03:40)
Approve the applications on a first-come, first-served basis or approve applications based on the best qualified of the bunch. In my opinion, best qualified of the bunch is the way to go. My job as a third-party property manager is to find the best possible tenant for my client, the property owner. So if I’m given the choice between three applicants, one who doesn’t qualify, one who barely qualifies, and one who blows the qualifications out of the water, I’m gonna go with that last one. Keep in mind that tenant screening is just a snapshot in time. Just because someone screens really well does not mean that they’re going to be a great tenant. People can screen well and still live like slobs. People can lose their jobs two weeks after moving into a new rental. People are still people and at the end of the day, the screening provides insight, but life also happens.
Andrew Schultz: (04:27)
Now with regards to the applicants that you did not approve, if you ran a consumer report such as a credit or background check and you take any sort of adverse action against that applicant, including denying the application, you need to send an adverse action notice to that applicant. Some states may require you to provide details of why the application’s being denied, but whenever possible, I would recommend that your adverse action letter be as generic as possible. Rent Prep provides a great example of one on their website that you can download and use. Head on over to rentprep.com and check out the tenant screening 101 section for a ton of information on that subject. There’s a lot of great information over there on Fair Housing Law, rental applications, compliance, and so much more. Now, the Adverse Action Letter simply states, thank you for applying and we are unable to approve your application at this time. It doesn’t specify any reason beyond that. In our adverse action letter, it does include the required notice to the applicant that they’re entitled to a free copy of their consumer report within 60 days of the notice, and they can dispute the information on that report with the screening company. So make sure that you’re using an adverse action letter that covers your bases. Tenant screening can be a real challenge, but it sounds like you’re well on your way. Good luck with your new tenant,
Voice Over: (05:43)
Water Cooler Wisdom Expert Advice from Real Estate Pros.
Andrew Schultz: (05:51)
Moving right along, we’re gonna jump into our water cooler wisdom segment. This one comes to us via the Rent Prep for Landlords Facebook group. Let’s go ahead and dive right in. Does anyone have experience working with a restoration company? We received record rainfall and flooding in San Diego. I’m trying to see what a damage estimate would be. We received mud and water inside the home and the damage to the outside of the home consists of landscaping, mud, and replacing fence slats. The renters went to a hotel, and again, this one comes to us via the Rent Prep for Landlords Facebook group. Storm and water restoration is a big industry. Water can be incredibly damaging much more so than people realize. I can remember probably a decade or so ago we had a fire in the front wall of one of our properties. The fire itself caused very, very minimal damage, but the water damage, however, was so much more extensive.
Andrew Schultz: (06:43)
The fire was on the second floor, so all of the water found its way down to the first floor and into the basement causing ceiling wall and floor damage in the first floor, as well as damage to one of the furnaces and hot water tanks in the basement as well. The restoration company that we ended up using did a great job. They came in, removed all of the damage flooring, the drywall, everything else. Then after that was done, they ran large fans and dehumidifiers to make sure that the building was dried out completely. Then they treated with some sort of an antimicrobial, and at that point we were good to go. From there, we stepped back in to rehab the building and get it back up and running. The restoration company was paid for by the property owner’s insurance carrier in that instance, which was awesome because the bill was pretty expensive.
Andrew Schultz: (07:26)
I don’t remember what the total was at this point because it was several years ago, but the crews were in that house for several days doing work plus the per-day rental on all of the fans in the dehumidifiers, so it definitely added up. I’ve also seen restoration companies that don’t do a great job at the cleanup and treatment stage, which often results in issues when it comes to the rehab. For instance, we had a different restoration company on a property where a toilet had leaked for about two weeks while the tenants were away. Essentially, the supply line to the toilet cracked and blew off probably a few hours after they left for a two-week vacation, and the property sat and flooded for two weeks. Same basic situation. There was a lot of water damage across multiple levels of the home. The restoration company came in and did the removal of all the damaged building materials, but they didn’t pull the screws out of the studs as part of their work.
Andrew Schultz: (08:14)
So when the rehab crew showed up to start the rehab job, they had to spend a full day just walking around the house, taking screws out of studs so that they could actually throw drywall onto a flat surface. The problem with restoration companies is when you need one, you probably aren’t in a position where you have a lot of time to do the research to try to find the best option either in terms of quality or in terms of price. Usually, it’s more of a rush scenario where you’re trying to prevent additional damage from taking place and you need them in there quickly to get the job done. It’s a good idea to know of a couple companies in your area on the chance that something like this does pop up and more than likely your insurance carrier would also have some recommendations as well.
Andrew Schultz: (08:53)
So essentially what I’m saying here is that not all restoration companies are created equal. As with any contractor, be sure that you read over the scope of work before you agree to anything and understand exactly what is and is not going to be done. You don’t wanna wind up in a situation where there’s a contract dispute or you have to bring in another vendor, or even worse, you get stuck handling it yourself. Good luck on your storm restoration. Moving on to the third and final segment of this episode, we have another water cooler wisdom, and this one also comes to us via the Rent Prep for Landlord’s Facebook group. It actually seems like it might be related to our last one. Let’s go ahead and jump right in. What’s a good professional-grade mold spray slash prevention? We had some water spilled while removing a base sink cabinet, and we wanna make sure that there’s no mold growth, and again, this one comes to us via the Rent Prep for Landlord’s Facebook group, so we’re gonna skip over talking about testing and wearing PPE when dealing with mold and how not all mold is harmful, black mold and all of those other topics.
Andrew Schultz: (09:55)
We’re gonna jump right to the question at hand. Do some more research. Mold can be bad for you. Moving right along. The first step in mold treatment and the best step for prevention of mold is to eliminate the sources of moisture that are causing the mold in the first place. Going back a few episodes of the podcast, we actually discussed sealing a crawl space and ensuring that moisture is kept out of that space. I recommend going back and listening to that episode number four 16. There’s a ton of great information in there on eliminating moisture in a crawl space situation and really just in general, another pretty obvious source of moisture is your plumbing, both supply side and drain side. If you have a leak under your kitchen sink for instance, that’s just begging for property damage and mold. Dark and moist are great conditions for mold growth.
Andrew Schultz: (10:40)
Mold growth is also super common along the edges of the tub where it meets the wall because oftentimes moisture will sit there after a shower. I’m sure we’ve all seen, you know, the moldy caulk lines that appear over the course of time that need to be resolved, and I’m sure that we can also all think of tons more scenarios where plumbing issues can lead to a mold concern on the outside of your home. Be sure that you’re directing water away from the home with properly connected gutters, downspouts, and extensions or kicks. Keeping moisture away from the foundation walls helps to keep it from finding its way inside your home. Here in Buffalo, we have a lot of stacked stone foundations in old housing stock from the late 18 hundreds to early 19 hundreds. Every single one of those foundations will weep, and a dry basement is pretty much never an assumption in these instances, so running a dehumidifier or two, depending on the size of your basement may be prudent in a situation like that as well.
Andrew Schultz: (11:32)
With regards to what products to use on mold, many people will recommend a one-to-one ratio of vinegar and water. I’ve also heard one-to-one Ammonia and water. I’ve also heard one-to-one Bleach and water. I don’t have a recommendation for or against the vinegar or the ammonia, but out of those three, I do not recommend the one-to-one bleach and water. The reason for that is that it doesn’t actually kill the mold completely and it will come back. One of the common tactics that you see from servicers on foreclosed properties is to spray off a moldy basement with bleach and water and then spray off the whole basement with kills. This literally ruins homes. The underlying mold isn’t properly being handled and now you’re trying to quote-unquote encapsulate it, but really you’re just making it harder to actually deal with the situation properly. I see this all the time and every time I see it, I let my client know that it’s most likely the result of a moldy basement.
Andrew Schultz: (12:24)
I know that you’d asked about professional grade, but you can get everything you need over the counter to deal with most mold situations. Professional grade stuff typically either requires a license or really isn’t any more quote-unquote professional than the same product sold off the shelf for off-the-shelf mold cleaning products. I like crud cutters, bleach-free mold, and mildew spray bottle. You could pick that up at any Home Depot. That’s what we use in our properties. That’s what we use in our own home. I also like the Odo bond disinfectants, which we typically buy in the one-gallon jug again from Home Depot. That comes as a concentrate, which you can mix into a spray bottle or a bucket, and it works great on mold. We’ve also used it in weed sprayers before in situations where we’ve had a sewer backup or something like that, and we need to disinfect a large area.
Andrew Schultz: (13:10)
The most important part of mold cleanup is ensuring that you’ve eliminated all of the mold as well as eliminating or mitigating the source of moisture that led to the mold in the first place. If you skip that cleanup step, you’re going to wind up back in the exact same situation you found yourself in in the first place. Professional mold remediation is also available and you may wanna consider that depending on your situation and the type of mold you’re dealing with. Again, we didn’t get into talking about testing or PPE but understand that your obligations and take them seriously. Mold can have very, very serious health impacts if it’s not dealt with properly. Make sure you’re taking the right steps and good luck in your cleanup process.
Andrew Schultz: (13:50)
Do you need a new rental application or maybe a new notice to vacate letter? Rent Prep currently offers over 60 free forms on the website. Download the form package today over at rentprep.com slash blog. That pretty much wraps it up for this episode of the Rent Prep for Landlords podcast. Thank you all so much for listening. We truly do appreciate it. Our goal with the podcast is to help as many people as possible make educated decisions when it comes to real estate, and you can help us reach our goal. If you heard anything in this week’s episode or any other episode that will help someone you know, do us a favor and share it with them. If you’re looking to get in contact with me, I can be reached over at whatsdrewupto.com. From there, you’ll find links to everything going on with me over at Own Buffalo, as well as other projects that we’re working on.
Andrew Schultz: (14:37)
Grab a copy of our free deal analysis tool today over at whatsdrewupto.com. There’s no obligation and it comes with a free companion video showing you how to use it. If you’re looking for top-tier tenant screening services, head on over to rentprep.com. There are multiple products to choose from, including tenant-paid options, and if you’re over 50 doors, ask about the enterprise-level programs and pricing. We’ve been enterprise users of Rent Prep for over a decade now, and it’s absolutely changed the way that we screen our tenants. Check that out today over at rentprep.com. Again, thank you all so much for listening. We’ll be back in two weeks with an all-new episode that you won’t wanna miss. Until then, I’m Andrew Schultz with ownbuffalo.com for rentprep.com, and we’ll talk to you soon.
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