I always repeat to myself and live by the following statement: 

Landlord’s Creed
I vow never to rent to someone else,
 Something that I myself would not be happy living in.
Mansions not included!

You will have a much better life if you live by that creed.  Your tenants will love and adore you and you will automatically be driven to the point of understanding how your tenant feels about the place they are going to be calling home.  The key here is to eliminate passive-aggressive behaviors by doing the right thing!

Never ever neglect, mistreat or abuse your tenants.  In fact, I treat them better than I treat my friends.  I respect and value them; I appreciate and care about them.  I really am concerned about their well-being and security.  If they call me with a problem, I send someone right out or I go myself to correct it.  If that were necessary, if I was without hot water at home, I would have it fixed in 24 hours.  I look at the problem through my creed and believe me, I feel good when their problem is fixed.  My service technician is also a good spy; they report back to me any other potential problems within.

So you say, “Dan, but how do I get these heaven-sent tenants?”  Well, the law of cumulative effect has a lot to do with a smooth operating investment and here’s how it goes.

You did your homework in the beginning by understanding how to evaluate a good property in a good location and buying at the right price.  So to begin with, you have a desirable rental that is mostly trouble free, that you can rent out to good people at a fair price and thereby increase your position in life by adding happiness and contentment to the lives of others.

You may be thinking, “I’ve invested so much time, effort and money.  How can I be sure I won’t get the tenants from hell, Dan?”  Here’s how you’re going to find your dream tenants.

Assuming your property is absolutely ready for someone to begin living their life in, you are going to place the real estate ad announcing to the community that you are accepting applications and will be interviewing prospective tenants.  Note: Applications and credit checks come after people have seen the property and after you have interviewed and seen them.  Don’t spend your time or other’s time on paper work until you have a tenant that fits initial screening criteria.

Always keep in mind when designing your advertisement the following acronym: A.I.D.A.  You want to get people’s attention, interest, desire and action.  What benefits do you offer?  What is the advantage of leasing from you?  Make your ad stand out, with a headline and a border if possible!

Pattern your ad after this:
 
1. For lease – 3 bedroom, 2 bath, 2 car w/attached garage
2. 1525 sq. ft. ranch style home w/split plan
3. central heat & air, all appliances, fenced yard
4. immaculate condition, new carpet, tile & paint
5. close to Adams Ave. & U.S. 19, 1ST, last & security
6. $1350 a mo., WSG is included; call 555-1212 for appt.

Let me break this ad down for you.  It is going to perform some very specific functions for you.

      For lease – Lease instead of rent; a lease says to people, “this is a long term
      commitment.  I should take these people seriously.”  
      3 bedroom, 2 bath, 2-car w/attached garage – spell out what it is you are    
      offering.  Don’t make people struggle to understand your message (make it  
      clear).
      1825 sq. ft. ranch home w/split plan – now you’re telling them that it has so
      much room for all their stuff, and it has privacy with the master bedroom  
      having its own bath.  They begin to picture a long ranch style home that has
      privacy.
      CH/A, all appliances and fenced yard – now you’re telling them that it is  
      comfortable and comes well equipped to serve their needs.  The fenced yard  
      adds the security & privacy factor back in again.
      Immaculate condition, new carpet, tile & paint – Here you are telling them
      we care about our property and we don’t lease to slobs.  We also care about  
      you, our tenant, so we have given you the luxury of new carpet, tile & paint.      
      You are also subtly saying that there is nothing wrong with this house.  You   
      won’t have any problems and we expect you to appreciate and take care of our  
      investment.

      Close to Adams Ave. & U.S. 19, 1st, last & security – you want to give    
      people major landmarks so they know where it is generally located.  At this   
      point, you do not want them driving by, knocking on the door, disturbing   
      neighbors or barging in on you demanding that you take their money and rent
      it to them  (Don’t put the exact address in your ad.)
                  No, no, no!  It does not work that way.  You have worked very hard in order
      to lease a quality residence and you remain in control.  This is a crucial,
      critical, important part of the screening process.  You’re carefully worded ad
      should appear in all editions – North, South, East and West.  You want
      maximum first time exposure in the most popular, largest circulation
      newspaper in your city or town.

6.  $1,350.00 a mo., WSG (water, sewer, garbage) inc., call 555-1212 for appt.
     This is the bottom line: $1350.00 a month + a month + another ½ month as a 
     security deposit.  This is telling people to do the math.  Is it out of your price
     range?  We do pay for your water, sewer and garbage.  $1350.00 + $1350.00 +
     $675.00 = $3375.00 cash required before you sign our lease and take control of                                         
     our hard won investment.  We mean business!  We will not accept a check at
     this meeting; you must bring cash! Really you can accept a check at this time   
     so long as it clears by the deadline you have set for it to clear, before
     possession takes place by the tenants. (No keys until money, the lease and all  
     background checks clear.
 
 Now I can almost guarantee if you have done everything right up to this point, your phone is going to start ringing as soon as the paper hits the street.  I encourage you not to answer it.  This is why:  you are in control.  You are going to let the answering machine get that call, with a message that says, “We will be returning calls after 5pm today.  Please leave your name, number and a brief message. Thank you.”  Why do this?  You are going to listen to those people on the phone.  You’re going to get a feeling for who they are and the validity of their reasons for wanting to rent your home.

Do not discriminate based upon age, race, religion, national origin, sex or any of that garbage.  It is against the law and you are potentially ruling out an excellent tenant.  What you are looking for is the person who has the perfect and most logical reasons for wanting to lease what you have.  Plain and simple, you’re looking for the best fit.  Based upon that criteria, start calling people back!

Here is a good fact finding script that I developed to get to the core issues quickly!

The script:
#1  Why do you want to lease as opposed to buy?
#2  What do you feel our house has to offer that others don’t?
#3  Where do you live now?  How long have you been there?
#4  Why are you moving?
#5  When do you plan to move?
#6  How long do you think you might stay here?
#7  We require 1st, last & ½ month security in the form of cash and a 1 yr. Lease
      Can you satisfy these requirements?  (Do not bend; establish control early!)
#8  Please allow me to call you back.  I’ll have to talk to my spouse (or partner).  
      This is your prescreening interview.  You are going to call everyone back now 
      as a result of using the above script. As you screen these individual callers,
      write down their name and number.  This is your reference list.  Start making  
      notes on who appears to be the best fit for your property.
Now call your most promising, best fitting prospective tenants back first, and tell them you will show them the property at noon on Saturday.  Continue down your list, scheduling showings at 1 pm, 2pm, 3pm, 4pm and 5pm.  Now these people don’t know you have scheduled 5 other appointments on Saturday and 6 more on Sunday but they will after you have shown the property to them.

This is why: You are still in control!  See how you keep control?  That is what real estate is all about – control.  Never forget that!  They might just say this will do.  We will take it right now.  Here is where you tell them that you cannot do that right this moment because you have promised to show the property to other prospective tenants that are interested in it as well.  Politely inform them that you will be calling all parties back after 6 pm to inform them of your decision.  If you have done it right, you will be calling the perfectly fitted tenant back at 6 pm on the dot, to inform them of their good fortune in being chosen as the best tenant.

Once you are sure that these tenants appear to fulfill your requirements up to this point then here is when you ask them to go the rest of the distance by filling out your rental application and allowing you to run the infamous credit check!

A neat trick here is to go to a real estate office and pick up a rental application to use as a template to create your own personalized application, for credit checks I would follow the directions located at www.Mrlandlord.com.

Once everything checks out with the chosen tenants that have passed your checks
call the other folks back and inform them that unfortunately, you are very sorry but another applicant was chosen.  Keep backup tenants just in case your first choice falls through.

Congratulations to you and your tenants.  You both win if you have the perfect fit.

I have always used the lease agreements straight out of the Landlording manual by Leigh Robinson.  If I wanted to add any further terms and/or conditions, I would create an addendum and include it with my lease.  I make master copies and keep them on file.  They serve me well!  If you have any questions, I suggest you consult that new attorney you found to help you here also.

Give your tenant a signed copy of the lease and a set of keys to their new leased home.  Give them your contact information and some envelopes to send you your rent check in.  Be attentive and care about these wonderful people.  If something breaks fix it fast!

There is so much more to tell, but I wanted to throw this one at you before you rent to deadbeats, just be careful and screen prospective tenants well, they are always the reason people get out of this business.

Dan Auito is a dual-licensed real estate agent and appraisal assistant. Dan is a 20-year veteran of the United States Coast Guard. He has acquired over 1.3 million in real estate assets in 14 years while also founding a non-profit drug prevention corporation, a real estate consulting group and is the author of “Magic Bullets in Real Estate.” This 300-page power-packed book (due out in late Sept 2004) comes with a website that further supports its readers. Dan lives with his wife Kimberly and their two children, Brandon and Briana, on the emerald isle of Kodiak Island, Alaska.

Dan may be reached by visiting www.magicbullets.com