Careers     Rental Application     Tenant Login     Call Us:   702-376-7379


Author: Tony Sena

The Importance of Renter’s Insurance

Shelter Realty, per our lease agreements, requires all tenants to purchase renter’s insurance.  Many tenant’s inquire as to why we require them to purchase rental insurance.  Laurie Yakubik with Farmer’s Insurance has provided the following information about the importance of having renter’s insurance.

HOW RENTERS INSURANCE HELPS COVER YOUR VALUABLES

Imagine a moment you’ve just returned home from a long day at work to find there’s been a fire. Everything you owned has been destroyed: your flat-screen TV, computer, furniture, books, game consoles, CDs, jewelry, collectibles and clothing. Where will you stay until your home is renovated? Who will pay to replace all your belongings? Not your landlord.

A Farmers renters policy can be the answer. It provides coverage to help you to replace your lost or damage items. If you suffer a covered loss, we’ll reimburse you for your lost or damaged items. And if the loss makes your home uninhabitable, we’ll also pay for the additional living costs for hotel, meals and related expenses.

Renters policies are very affordable, generally ranging from $12-$20 each month. For less then a dollar a day, you can have valuable insurance coverage!

BENEFITS

  • Personal property coverage
  • Personal liability coverage
  • Additional living expenses

OPTIONAL COVERAGES

  • Personal articles floater
  • Jewelry, furs, fine arts

For more information on renters insurance, feel free to give Laurie Yakubik a call at 702-456-8119 or visit her website at http://www.farmersagent.com/lyakubik

Landlords

Landlord Wants to Sell Las Vegas Investment Property, So What Happens With the Tenant?

I spoke with one of our property management clients today and he inquired about selling his Las Vegas home but he wanted to know if he had to wait till the tenant vacated the property before he could sell.  This was the second time I was asked this question in the last two weeks.  Any Nevada landlord has the right to sell their investment property whether the property is occupied by a tenant or not and the tenant is required to give the landlord reasonable access to show the property.

Usually, our tenants agree to cooperate with showings when they are notified the landlord has decided to sell the property but they do have numerous questions such as:

  1. Do I have to move? No, you have a valid lease and the lease will transfer with the sale of the property.
  2. Do I have to let people in to see the home?  Yes, our lease requires you to allow reasonable access to the property for showings to prospective buyers.
  3. Am I required to have a lock box on the property? No, we understand that you don’t want strangers walking through your home when you aren’t present so all showings will be scheduled with you.
  4. Can I buy the home?  Yes, as long as the owner accepts your purchase offer.

Occasionally we will get that tenant that states they don’t care if the owner wants to sell and they have the right to quiet enjoyment so they will not allow anyone access to the property.  At that point we will explain that their lease explicitly states they have to give the landlord reasonable access to show the property to prospective buyers.  Lastly, we will point out that NRS 118a.330 states the following:

A tenant shall not unreasonably withhold consent for the landlord peaceably to enter into the dwelling unit to exhibit the dwelling unit to prospective or actual purchasers, mortgagees, tenants, workers, contractors or other persons with a bona fide interest in inspecting the premises.

If the tenant still refuses to give access to the property, we will post a 24 hour notice to enter the property during normal business hours.  Luckily, we have never had to post a 24 hour notice to show a property to a prospective buyer as most of our tenants understand the owner has the right to sell their property and cooperate.

If you have any questions about selling your Las Vegas investment property or are in need of a property manager, give me a call at 702.376.7379.

Nevada Landlord Requirements Upon Termination of Tenancy

Many Nevada landlords are not aware they have a responsibility to provide the tenant with an itemized accounting of their deposit within 30 days of the termination of tenancy.  If the landlord fails to return the tenants entire deposit or an itemized accounting of the deposit within 30 days, the landlord could be held liable by the courts for up to the full amount of the security deposit.

NRS 118A.242 states the following:

Upon termination of the tenancy by either party for any reason, the landlord may claim of the security or surety bond, or a combination thereof, only such amounts as are reasonably necessary to remedy any default of the tenant in the payment of rent, to repair damages to the premises caused by the tenant other than normal wear and to pay the reasonable costs of cleaning the premises. The landlord shall provide the tenant with an itemized written accounting of the disposition of the security or surety bond, or a combination thereof, and return any remaining portion of the security to the tenant no later than 30 days after the termination of the tenancy by handing it to the tenant personally at the place where the rent is paid, or by mailing it to the tenant at the tenant’s present address or, if that address is unknown, at the tenant’s last known address.

If the tenant disputes the itemized accounting statement in writing within 30 days of receiving the statement, a landlord cannot send the outstanding balance owed to a collection agency unless you obtain a judgement against the tenant.  This is why it’s very important to have a move-in condition report completed at the time of tenancy along with pictures to compare with the move-out report and pictures.  Keep in mind, a landlord can only hold the tenant responsible for damages to the premises, cleaning and any unpaid expenses during tenancy such as rent.

Whether you are accidental landlord or an investor, not knowing Nevada law can get you in big trouble.  If you decide not to hire a knowledgeable property manager, it’s imperative you take the time to familiarize yourself with NRS 118A to minimize future legal issues.

Not knowing or understanding Nevada landlord/tenant law is another reason why hiring a property management company to handle the management of your investment property makes sense.  To discuss the management of your investment property, give Shelter Realty a call at 702.376.7379 or email us at info @ shelterrealty.com.

Paul Rowe of Shelter Realty Completes CDPE Short Sale Designation Course

Las Vegas, NV – February 5, 2013 – Shelter Realty

Shelter Realty’s top producing short sale listing agent recently added the CDPE (Certified Distressed Property Expert) designation to his license after completing their intense two day course on January 29th, 2013. The Charfen Institute which created the CDPE course has established itself as the preeminent training program for short sales.

The need for qualified short sale agents in the Las Vegas real estate market has dramatically increased after the market crashed in 2008 and sellers needed a viable alternative to foreclosure.

When asked why Paul took the course despite having already closed nearly one hundred short sales already, he replied: “It is important for sellers to know who is a true expert and who is not. I had the experience and plenty of short sale closings, but it is also important for future clients to see that I have completed formal training as well.” The CDPE designation is something the public recognizes and helps them during their evaluation period when deciding if an agent has the skills necessary to guide them through very difficult circumstances.

Paul also belongs to other short sale groups such as Short Sale Genius, Short Sale Superstars. “Constant training is necessary to serve my clients, he said. Nobody has all the answers, especially in a rapidly changing field like short sales. The way we do short sales is dramatically different from just a few years back. I belong to work groups with agents and other real estate professionals from across the country which provide valuable support should a short sale transaction begin to encounter serious difficulties.”

You can reach Paul Rowe by calling Shelter Realty at (702) 376-7379 or by emailing info @ ShelterRealty.com or by filling out a contact form on the Shelter Realty website.

Seven Hills: Tuscan Getaway Minutes from the Vegas Strip

Tired of the hustle and bustle of Las Vegas?

While it is true Las Vegas is considered Sin City, even the most ardent of Sinners must eventually repent. And what better place then in the rolling hills of the Tuscan inspired community of Seven Hills. This is truly one of those magical places that can whisk you away from where you are and take you far away to the romance of the Italian countryside and yet still give you breathtaking views of the Las Vegas Strip.

Many of you may wonder what the significance of Seven Hills is. It’s said that it was named after the Seven Hills that Rome was built on. Though it is more of Tuscan design than Roman, the feeling of Italy is still here. You can see it’s impression on every stone. I doubt either Roman courtesans or the Emperor himself would find fault with this beautiful community.

Seven Hills is located only about 20 minutes from the strip in the Henderson area and is literally minutes form the heart of Henderson, so shopping and entertainment are never far away. The community is broken up into around 25 different communities, each with it’s own Italian name, lest you remember you are still in Vegas. There are gated communities within gated communities giving an even greater air of exclusivity. Within these communities the properties vary immensely from beautiful town homes to incredible Tuscan villas.

Are you looking for a nice evening out with the family, but don’t want to go too far from home? Shared amongst the residences are 4 large parks with tennis, volleyball, basketball, and even soccer fields. Maybe you’ve had a hard day at work and are looking for something a little more serene? How about a picturesque walk through one of the many winding paths or perhaps a relaxing bike ride on one of the bike ways. Or possibly, you would rather just sit and relax, and gaze at the surrounding mountain views above, or the Las Vegas strip lit up at night, down below.

Are you looking to live in the luxury the emperor himself might have lived in? There is a place for you here as well. The Estates at Seven Hills is one of the most exclusive communities in Henderson. And for those of you that love golf it’s the perfect place to reside. Within the Estates lies what Golf Digest named one of the top 10 new golf courses in America. The Rio Secco Golf Club. It was designed and constructed by none other that Rees Jones. The course itself has some of the most breathtaking views around and the homes that border the course offer some incredible views of the course itself as well as the Las Vegas Strip. If you find the course too challenging, don’t feel bad, it’s even given some professionals a run for there money. Luckily for you however, the Butch Harmon School of Golf is also located here so you should be able to improve your game in no time.

So whether you are a courtesan or an Emperor, or just a loving family looking for a magical place to live, Seven Hills is waiting for you. Come home to the Tuscan countryside, come home to Seven Hills. For more information on homes in the Seven Hills area, please call 702.376.7379

The Martin in Las Vegas

Thinking of buying or renting a condo at The Martin in Las Vegas? Three words location, location, location!

Cross over the hardly used Harmon bridge making use of amenities, such as Range Rover car service along with concierge service providing any tickets to shows or sporting events, ensuring an effortless night on the town.  Or simply get away from the Las Vegas hustle and bustle by using the main road the martin is located on and hit the freeway off Tropicana.  Planning a visit to your home away from home? Call ahead and have the concierge stock your condo with food before you come into town for a weekend stay.

Once you pull up to The Martin allow white glove valet attendants to take care of parking your car and even give it a detail if you wish.   Why go out when you can stay in? The health and wellness programs, fitness center and yoga studio, spa, steam rooms, and cabanas poolside will ensure a full day of relaxation, while the house cleaning service takes care of the to do list in your residence.

After a long hard day of relaxation why not take advantage of the beautiful Las Vegas Strip views and entertain some friends or simply catch up on your favorite tv shows via direct tv satellite which is included in the your low HOA fees.  The Martin takes care of you , your pocket book and well being!

For more information about about buying, selling or renting at The Martin, give Len Musurichan a call at 702.308.1003 or send him an email at len @ shelterrealty.com

Avoiding the pitfalls that come with older rental property and finding profit the aging housing stock.

One of the realities of real estate is that it needs maintenance and upkeep. The older a property the more issues tend to arise that will cost investors, landlords and homeowners more and more money. The trend in Las Vegas is to invest in newer property that will have less maintenance issues and in turn less tenant phone calls. The idea is to keep the management costs to a minimum. Many companies will manage older property because of the additional time and expenses that tend to come with older property. However, you may be missing out on some great deals and fantastic opportunities to make money or find a home if you set your sites on only newer property.

There are ways to limit the future issues that will come up with an older property and they often do not cost as much when done in advance. The major expenses come in when you find out a water line running through the attic springs a leak which can lead to the replacement of the ceiling, insulation and light fixtures. Another major headache can if the water heater is located inside the property and not in the garage. If the water heater leaks or rusts enough to leak out the bottom you could have a repair bill out of this world.

The question is whether you can do things to limit major issues and expenses to make it worth while to consider an older property as a home or investment. You may be able to find what you want in investment property in Las Vegas today that is only a few years old but this will not always be the case. The housing stock will get older and older. If you are not willing to consider properties more than 10 years old you will be limiting your opportunity to find great deal.

How can you avoid some of the headaches and costs of owning older property in Las Vegas? The number one answer is better preparation and planning. You will have to account for somewhat higher maintenance costs that are completely normal in older homes. In order to cover the higher costs you will have to look for property that will get slightly higher cash on cash return than newer units. This is simple enough to by just looking for slightly undervalued property in rental areas that have monthly rental pricing that has remained strong. There are many of these areas in town and there often is far less difference in rental pricing then there is in home price variation. Rental rates seem to fluctuate less over large areas of town where home prices can be much more inconsistent.

Once you find the property you like you can evaluate any issues that may lead to more management complications. Nearly everything can be fixed in older homes but there is always a price to pay. Some things are just not worth fixing if it will mean you will spend 10 years trying to recoup the cost. However, most property can be put in perfectly good rental condition by spending a reasonable amount of time and money before you find a tenant.

I will go into more detail about the minor and major things you can do to make owning an older rental property another profit center for you portfolio.

Has your nest egg become your anchor? Just about everyone is in the same position. We can help get your head above water again and allow you to take control of your future. Call me today and find out your best options to get out from under your monster mortgage. Don’t let the housing crash control your future. You have options.

Increase Your Real Estate Returns Using Leverage

Leverage is the number one reason you can get such great returns on real estate. Most people don’t understand leverage or understand the principals that make leverage such a fantastic tool in your real estate investing arsenal.

First let me define leverage in the way it applies to real estate. You use leverage when you buy a $200,000 property with a 20% down payment and borrow the rest of the money from the seller or the bank. If you paid cash for the property you would need to come up with 200,000 and change at closing to take over a piece of real estate. You would be using no leverage and you would be looking for a return on your capital that would be similar to what you would get in other investments. If you made $2400 in rent per month and after expenses put $1500 cash in your pocket each month you would make $18000. This $18,000 would be your yearly return on capital invested. It is a good return and it is possible to make a good living buying property for cash. You can calculate your cash on cash return by taking your $18,000 profit divided by your $200,000 investment.

The number is given as a percentage. You would end up with a return of about 9% for the year. This is a good return on capital but not nearly what you can get if you use leverage to make your purchase.

Let me give you the same example but with a 20% down payment. You would have to bring $40,000 to the closing for your down payment and you would be financing $160,000 from the seller or the bank. Rates are relatively low now but they tend to be higher on investment property but I will use 6% rate of interest on the $160,000 financed. We can calculate what it will cost you in interest the first year by taking 6 % of $160,000. The amount of interest on your loan will be $9600. You are paying $9600 the first year of your loan in interest to use leverage. If you fully amortized the loan you will pay $959.28 a month principal and interest.  This also leaves you the 160,000 in cash that you would have been investing in one property available in your bank account for other purchases so you are keeping your options open to buy more real estate.

Let’s take a look further at my example and see if you can actually make more money by using leverage.

You will still receive the same 2400 payment for rents per month except now we need to add in the interest cost into the calculation. You will still be taking in the 18000 a year but you have to pay your mortgage or at least the cost of interest out of cash flow.  You will pay principal and interest of $11,511.36 out of your gross rents and your free cash flow at the end of the year will be only $6489 in our example. It looks like a lot less but let’s pencil out what return you can actually get by using leverage and not paying all cash.

We take the $6489 net gain for the year and divide it by the amount of capital invested which is 40,000 this time. So what looks like smaller gain in income becomes a much greater return as a percentage of your capital because the new calculation comes out to over 16% return on your investment.

Leverage is the key to profiting from real estate. It is possible to double or triple your return on capital invested by financing a portion of the deal. The lower your down payment the greater your return on your money.

If you have any questions about investing in Las Vegas Real Estate, give us a call at 702.376.7379!

Three Simple Steps To Rent Your Las Vegas Investment Property Quickly

The real estate rental market in Las Vegas is competitive and also very lucrative. As a real estate investor, you’ll want to make sure you take some simple steps to make sure your rental property is the home that prospective tenants choose. Here are some simple tips to make sure your Las Vegas Investment property rents quickly.

  1. Competitive Price

The monthly rent price is your first step in getting prospective tenants through the door of your Las Vegas investment property. Setting your price is pretty simple. Ask your property manager to run a competitive rental analysis of the other rental properties in your neighborhood.

They can tell you what’s a good price for your Las Vegas rental property. A good rental price will make sure you get interest from prospective tenants, but getting them in the door is only half the battle.

The next two steps will make sure your home is the home that quality tenants choose over the competition.

  1. Flooring, Paint, and Window Coverings

Homes with new paint and clean carpets are always going to rent faster than those without. As a rental property owner, just accept the cost of replacing carpets and painting after tenants move out as a cost of doing business. People may live in places with dirty carpets and walls, but they usually won’t choose to move into one.

Also, many of the tenants I meet with actually prefer tile and hard wood floors to carpet. So installing some pergo or tile is a good way for a property owner to avoid having to replace carpets every few years.

Another simple way to make your place stand out from the competition is to put nicer blinds up on your windows. You don’t have to put plantation shutters on all the windows in your rental property, but some low cost faux wood blinds with thick slats look a hundred times better than the cheap aluminum ones. Take a look at the bigger picture and spend the money to get a tenant in and paying rent as quickly as possible.

 

  1. CLEAN!

I am shocked how many rental properties I show that are filthy. You obviously won’t be able to clean your rental property every day, but a good cleaning after a tenant vacates and every two weeks that your property is vacant will help to insure that your property won’t stay vacant for two months.

Rental Properties in Las Vegas take anywhere from a few days to a few months to rent. Taking these simple steps will keep your Las Vegas rental property ahead of the competition.

The Difference Between IRS Forms 1099 and 1042-S

What’s The Difference Between IRS Forms 1099 and 1042-S?

DO YOU HAVE FOREIGN OWNERS/INVESTORS?

As a property manager, you are very much aware that by law, you must issue a 1099 form reporting gross rents to your property owners by 1/31 of every year.

However, there seems to be a great deal of confusion out there when it comes to property managers with owners that are citizens of foreign countries.  You see, foreign investors do not get issued a 1099.  What do they receive?  They get issued a 1042-S.

WHAT IS THE DIFFERENCE BETWEEN FORMS 1099 AND 1042-S?

A 1099 form is used to report miscellaneous income, such as gross rent, for US residents and businesses only, whereas a 1042-S (Foreign Person’s U.S. Source Income Subject to withholding) is used to report income paid to a non-resident regardless of whether the payment is taxable.  Unlike form 1099, form 1042-S is not due to be issued until March15th of every year.

I see way too many property managers issuing a 1099 form to a foreign citizen.  This will lead to serious audit problems in the future as the IRS is cracking down on property managers filing the incorrect form.

The function of form 1042-S is to let the IRS know that a foreign person has earned income in the USA.   For the purposes of the IRS, a foreign person includes a non-resident alien individual, a foreign corporation, a foreign partnership, a foreign trust, a foreign estate and any other person that is not a US person.  When a foreign person or entity has earned income in the USA they must file an annual non- resident tax return. The IRS uses the     1042-S as a means to monitor tax filing compliance on the part of a foreign person or entity.

MAKE SURE YOU ALSO HAVE FORM W-8ECI ON FILE FOR EVERY FOREIGN CLIENT

As a property manager, you would report the annual gross rents on the form and also report any federal taxes withheld.  This is an important note: If you do not have a form W-8ECI (Certificate of Foreign Person’s Claim that income is Effectively Connected With the Conduct of a Trade or Business in the United States) on file for your foreign client, you should have withheld and submitted to the IRS 30% of the gross rents of your client.  The IRS also uses form 1042-S to monitor your compliance with this.  Failure to be compliant with this law may result in the IRS going after your company for the taxes owed by your client.  Therefore the message is clear: Make sure that you have this form on file for every foreign client you have!  You also want to obtain an updated W-8ECI every 3 years but I would suggest making it part of your annual checklist when renewing the management contract.

FORM 1042-T

After you file your 1042-S with the IRS, you will also have to file an annual form 1042T (Annual Summary and Transmittal of Forms 1042-S)  which is a tax reporting form that reconciles all of the 1042-S forms and tax withholding deposits to all of your form 1042-S paperwork.  This form is also due to be issued by March 15th of every year.

GROSS RENTS BOX ON FORMS 1099 AND 1042-S

I have noticed that there seems to be some confusion as to what constitutes reportable annual rental income that should be listed under the Gross Rents boxes on forms1099 and 1042-S.

The second part of this article will help all property managers have a clear understanding of the tax rules that apply to this box.

The following are common types of income:

ADVANCE RENT

Advance rent is any amount you receive before the period that it covers.  Include advance rent in rental income in the year received regardless of the period covered or the method of accounting you use.

Example

  • On May 15th, 2011 you signed a 2 year lease to rent property.
  • The tenant decides to prepay the entire lease.
  • You receive $10,000 for the first year’s rent and $10,000 for the rent on the second year.
  • The whole $20,000 must be reported on form 1099 in 2011.

CANCELING A LEASE

If tenant pays to cancel a lease, this payment is reported as rental income.  Include the amount on form 1099 in the year that it is received.

EXPENSES PAID BY THE TENANT

If tenant pays any of your rental expenses, the amount paid should be included in rental income and you would also deduct the expense.

Example

  • If the furnace in the rental property stops working and the tenant pays for the necessary repairs and deducts the amount from the rent payment.  The amount paid by the tenant would be included in rental income and the repair would be deducted as an expense.

PROPERTY OR SERVICES

If you receive property or services as rent instead of money, include the fair market value of the property or services as rental income in the year received.

Example

  • Your tenant is a house painter.  He offers to paint your rental property instead of paying two months rent.  You include in rental income the amount he would have paid for rent and deduct the same amount as an expense.

SECURITY DEPOSITS

This is the area where I see the most confusion.  Do not include a security deposit in rental income when you receive it if you plan to return the deposit to the tenant at the end of the lease.  If you keep part or all of a security deposit during the year because your tenant does not live up to the terms of the lease, include the amount you keep in rental income for the year.

If an amount called a security deposit is to be used as final payment of rent, it is advance rent and should be included in rental income in the year received.

I hope that this article gives clear direction on the IRS tax guidelines for what is reportable rental income, as well as helping all of you with foreign clients to establish a system within your office to remain compliant with the IRS and protect yourselves from costly audits!

__________________________

Guest article written by Richard Hart with Hart & Associates:

Richard Hart EA, CAA
President
Hart & Associates
Tax Consulting and Preparation Services
702-985-7148
www.hartassociate.com

Getting a Mortgage Loan in Las Vegas – Some Tips To Follow

Getting a Mortgage Loan in Las Vegas – Some Tips You Should Follow

According to recent reports, the fixed rate mortgage loan rates throughout the nation had hit a 40 year low, making this the perfect moment to refinance home loans for all those struggling homeowners who aren’t able to make their monthly payments on time. If you’re a resident of Las Vegas, you should be aware that the 30 year fixed rate mortgage varies from 3.85% to 4.54% in the beginning of 2012 and therefore any prospective homebuyer in Las Vegas can easily think of taking out a home mortgage loan at the present moment. If you take out a home loan that is beyond your affordability, it is most obvious that you have to go for mortgage modification or a refinance loan in the near future. Are there any tips that you may follow before taking out the right home loan in Las Vegas? Read on to know about them.

Shop around: Taking out a mortgage loan without shopping around among different lenders is a wrong decision that may lead to a chaos in the future. You should get multiple quotes from multiple companies so that you may easily be able to compare and contrast the rates and choose the best loan with the best possible terms and conditions. The interest rate and the closing cost are the two most important factors that need to be taken into consideration before choosing the loan.

Repair your credit score before applying: Whether you’re taking out a home loan in Las Vegas or anywhere, remember that the lender will certainly check your credit score before deciding the loan amount and the interest rate on the loan. Pull out a copy of your credit report so that you may know the various reasons that are dropping down your score and thereby work on it.

Check the amount you can pay down: Most mortgage lenders in Las Vegas ask for at least 20% down payment on the loan by the borrower and if you’re not able to pay down this amount, it is most obvious that the lender will make you pay Private Mortgage Insurance that will unnecessarily increase the monthly mortgage installments. Therefore, you should save enough money so as to be able to pay down the required amount on time.

Determine your debt burden: The total amount of debts that you have to pay in a single month in accordance to the income that you earn is another factor that is taken into consideration by the lender before determining the interest rate of the home loan. You should not only reduce the debt amount but also get help from a professional so as to be able to repay your high interest debts and be able to get back on track.

Organize your documents: Most often it happens that a borrower delays the entire process of taking out a loan due to his ignorance about the kind of documents that are needed by the lender in order to lend the loan. You should assemble your monthly statements, the income tax returns and the other bank statements that are necessary for the lender.

Thus, when you’re in Las Vegas and trying to take out a home mortgage loan, you should follow the tips mentioned above. Manage your finances so that you can take out the best home loan in Las Vegas and avoid opting for mortgage modification in the long run.

I am Alfred Smith from New Jersey and I am associated with several good finance community sites as guest authors and forum members. I do write articles on different genres of finance.

Eviction: A Property Manager’s Four Letter Word

Evicting a tenant is never pleasant (or easy), but for most landlords, it is unfortunately an unavoidable part of the job. Yet it’s one that the landlord must approach with caution, and a full awareness of all of the relevant state laws.

Tenancy termination laws vary from state to state, so before you proceed, know your state’s law. In most cases, before you can evict your tenant you must first legally terminate the tenancy with a written notice (often called a Notice for Termination with Cause) according to your state’s termination statute. If your tenant doesn’t “perform” (pay back rent or stop breaking the rules) or move, then you can file a lawsuit to evict.

Here I’m going to focus on how to write and deliver a Notice for Termination with Cause.  While the specific legal terminology varies from state to state, there are basically three types of these notices:

  1. Pay Rent or Quit Notices. These notices are typically used when the tenant has not paid the rent. They give the tenant a few days (three to five in most states) to pay the rent or move out (“quit”). In Nevada, where I run a property management company, a landlord can choose to accept partial rent payment and then rewrite a new notice of rent owed.
  1. Cure or Quit Notices. These are typically given after a tenant violates a term or condition of the lease or rental agreement, such as a no-pets or excessive noise clause. Usually, the tenant has a specific amount of time to “fix” the issue or violation. A tenant who fails to do so must move or face the possibility of eviction.
  1. Unconditional Quit Notices. These are the hardest to issue because they order the tenant to vacate the premises with no chance to pay the rent or correct a lease or rental agreement violation. In most states, unconditional quit notices are allowed only when the tenant has:
    • Repeatedly violated a significant lease or rental agreement clause
    • Been late with the rent on more than one occasion
    • Seriously damaged the premises
    • Engaged in serious illegal activity, such as drug dealing on the premises

Unfortunately, some tenants won’t pay the back rent, fix the issue, or leave even after receiving a Pay Rent or Quit or Cure or Quit notice.  If they don’t, your next step is to begin an unlawful detainer lawsuit by properly serving the tenant with a summons and complaint for eviction.

As they should be, state laws are set up to protect tenants’ rights.  But oftentimes they make even lawful evictions complicated.  Yet staying on the right side of state lease laws is critical.  It’s another reason why hiring a property management company to handle the management of your investment property can make great sense.