For your convenience, we have detailed below common questions and answers in relation to property management, and Prime Resource Property Management Inc. Please take a look over and read this material,as it will answer most of the questions you may have.
Feel free to contact us at contact@primerpminc.com with any further questions.
ARE YOU LICENSED?
Yes, all of our property managers are also licensed Real Estate Agents.
ARE THERE ANY UP-FRONT COSTS?
No, However, we require the owner deposit of $250 into their account to cover emergencies that arise in order to pay for services rendered, or for the necessary cost of the licensing the property.
DO WE HAVE TO DECLARE ANY INCOME ON A PROPERTY RENTED OUT?
Yes, rents received are income and need to be declared. Obviously, you can claim for such things as maintenance costs, management fees, interest on mortgages and depreciation. We are not tax experts and recommended that all clients get independent financial advice. Information is also available on the Internal Revenue Service website (www.irs.gov). There is a booklet available “Rental Income” advising property owners on the tax implications of receiving income from a property.
WHEN DO YOU MAIL THE OWNER’S CHECK AND STATEMENT?
Owners’ checks are deposited, and statements are made available online by the 10th of each month.
DO I LOSE CONTROL OF MY PROPERTY ONCE YOU START TO MANAGE IT?
No. We work for you. We allow you to be involved or uninvolved in the management of your property as you would like.
WHO COLLECTS THE RENT AND WHEN DOES IT COME TO ME?
At the beginning of each month, we compile a full statement for property owners of rents collected less all payments made on behalf of the tenant. The balance of the money is transferred by way of direct deposit by the 10th of the month (this allows for all rent money to be collected and cleared). Time frame may vary depending on the distance of mail transport if you prefer a check to be sent to you. The check and statement reflect activity in your account for the preceding month.
HOW DO YOU ACCOUNT FOR MY MONEY AND IS IT SAFE?
All rents and other moneys received on behalf of an owner are paid into our client account. This account is specifically for owners and does not form part of the operational bank accounts of our company. All payments made on behalf of the owner are also made from this account. Each owner’s transactions are individually identified within this account and the account is balanced on a daily basis. Owners are supplied with a monthly statement, which identifies all transactions during the month.
CAN YOU SEND OR WIRE-TRANSFER MY FUNDS TO MY BANK?
Owner’s funds may be sent directly to any bank account the owner chooses at no additional cost.
IF MY PROPERTY IS VACANT, DO I STILL PAY A MANAGEMENT FEE?
No. Management fees are only earned when rent is collected. No fee is payable when your property is vacant.
WHAT IF I WANT TO USE MY OWN MAINTENANCE?
An owner may use their own vendors as long as they meet out criteria and carry the necessary insurance and licenses.
HOW DO I KNOW YOU WON’T SPEND LARGE SUMS OF MONEY?
In the management agreement, we set a dollar amount in which cannot be exceeded without owner approval except in cases of emergencies.
HOW DO YOU DETERMINE THE RENT AMOUNT?
We use many tools to determine the appropriate rental rate for your property. Primarily, we rely on our vast experience with leasing similar properties. We also conduct a comparative market analysis to determine what other similar properties are receiving in rent.
HOW LONG DOES IT TAKE TO FIND A TENANT?
This depends on the market and time of the year. The rental market is very competitive especially with the number of new home and apartments available and continuing to be built. The number of available properties has increased and the presentation of properties has vastly improved. It is important to:
Present your property in excellent condition.
Price the property at the correct level (sometimes it is better to take $50 less a month and have a little down time than ask top price but have the property empty for several months). If you are purchasing a rental property and the selling agent advises you that the property will rent for “XYZ,” ask them how many investment properties they own or how many properties have they personally rented out in the 6 month period prior to marketing the property.
Remember rents have not increased significantly over the years. The value of the property increasing does not automatically indicate that the rental price increases.
We would allow 3-6 weeks to find a tenant.
HOW MUCH SECURITY DEPOSIT DO YOU COLLECT?
Typically, the deposit is the same as one month’s rent.
WHO HOLDS THE TENANT’S DEPOSIT?
The tenant’s deposit is held in an interest bearing escrow account administered by United Real Estate HomeSource in accordance with jurisdictional requirements.
HOW DO YOU FIND TENANTS?
We primarily use the internet and the Multiple Listing Service; these sites filter out to several other sites for maximum exposure. We also use signs, social networking, flyers, and word of mouth. We work closely with showing agents who have a list of perspective tenants looking for a home. Telephone calls come directly to Prime Resource Property Management Inc and potential tenants are personally shown through the property. No keys are given direct to potential tenants to view the property and the property is not left open and unattended for potential tenants. All properties are placed on a Sentri-Lock or combo lock for maximum protection.
WHAT DO YOU DO TO ENSURE I GET THE BEST TENANT AND THEY ARE QUALIFIED?
Nobody can guarantee you the perfect tenant, however experience has shown that following good procedures does minimize the risks. All prospective tenants are required to fill out an application form. This form ask tenants to provide information about the themselves and they are required to supply details of references and current or previous landlord information. It also authorizes us to do background checks, credit checks, rental/work history verification. We do decline tenants who have applied for properties when the reference checking does not satisfy our requirements. Residents must pass Prime Resource Property Management Inc application and qualifying guideline requirements. All guidelines are the same in order to qualify a tenant.
WHAT IF A TENANT DOES NOT PAY?
Rent is due on the 1st of every month with a state given grace period of the 5th, hereafter rent would be considered late. The next business day following the 5th of the month notices will be sent to you, the owner, regarding the nonpayment of the tenant. Between the 6th and 7th we will contact the tenant in regards to their nonpayment, and notify them of the additional fees that have incurred, and court proceedings are in process.
WHAT IF THE TENANT DOES DAMAGE TO MY PROPERTY?
The tenant will be responsible for all damages beyond normal wear and tear. If the tenant does damage to your property, money will be held from their security deposit. If the cost of repair for damages exceeds the amount of the security deposit, you can sue for the additional amount owed.
CAN I HAVE SPECIFIC CLAUSES PUT INTO THE TENANCY AGREEMENT?
All tenancies are subject to the Landlord and Tenant Act of Maryland and all clauses must comply with the act. Any clauses outside the act are unenforceable even if signed by the tenant. If you wish to have specific clauses, please discuss them with us.
DO YOU CONDUCT INSPECTIONS PRIOR TO DOING THE TENANCY AGREEMENT AND HOW OFTEN DO YOU CHECK THE CONDITION OF THE PROPERTY?
In most cases the tenancy agreement is done at the property with the tenant. We request that the property is completely empty at this point, all maintenance request must be completed, and the yard freshly groomed. We can take care of all this for you, however if you prefer to take care of this yourself everything must me complete within 48 hours to the date of lease signing. A joint inspection of the property forms a part of the tenancy agreement and allows for any defects to be noted. Interior condition surveys are typically done 2-4 times per year with pictures at the annual report. Other checks may be performed if a vendor notices something “unusual” at the property.
WHO SHOULD MAINTAIN THE GROUNDS?
If you have extensive lawns, shrubbery or gardens and wish to have particular care taken of plants it is recommended that you organize for a gardener to maintain the grounds on a regular basis. If the yard is small and the lawn is easy to maintain, it can be and normally is the tenant’s responsibility. If you have a multi-unit property (two or more units in the same building) we will organize regular lawn mowing services for you. It is difficult to ensure lawns are done if you leave responsibility to 2 or more sets of tenants in the same building. Your property will then start to look overgrown and untidy.
SHOULD WE LEAVE OUR FURNITURE AND RENT THE PROPERTY OUT FURNISHED?
Some properties are rented out furnished however these tend to only gain short-term tenancies. You will find you have additional wear and tear on your furniture, and you will be trying to rent your property to a more limited market (most potential tenants have their own furniture). You do need to be aware however that you as the owner of the property would be responsible for the maintenance on these items.
DO YOU CHARGE EXTRA FOR ORGANIZING MAINTENANCE?
There is no extra charge for organizing everyday maintenance (e.g., plumbers, electricians, small maintenance jobs etc.). However, if you require a refurbishment job or a major project to take place we do charge an admin fee of 10% for overseeing this. This charge covers time, gasoline costs when visiting the property, telephone calls, etc. All of this is done to ensure the job is completed to specifications.
HOW DO WE PAY FOR REPAIRS/ MAINTENANCE?
Purchasing a home warranty, is a cost effective way to keep the property maintained during a tenancy. The deductibles are low, and the service is prompt and courteous. We also use licensed and bonded Contractors that we employee for such work outside of the warranty coverage. We pay deductibles and contractors on your behalf out of rents collected and all charges will be shown on your monthly statement. We also request that each owner leave a credit card on file or specified dollar amount with us so we have funds to cover large maintenance expenses. This is in case the property is empty and their is no income coming in, or the work completed is of a major expense (done with the owners permission given prior to start of work).
WHAT HAPPENS WHEN A TENANT GIVES NOTICE TO VACATE?
We verify that the tenant has provided proper notice. If they have, we inform you that the property will be coming vacant, and with your consent with place the property makes on the market in order to gain a new resident. We survey the condition of the property and start any preventive maintenance or repairs needed.
WHAT DO YOU DO IF THE TENANTS ARE NOT TAKING CARE OF MY PROPERTY, OR YOU DISCOVER UNAUTHORIZED PETS?
We immediately contact the tenant and give the tenant an opportunity to correct the situation. If the problem persists, we will make a decision based on that specific situation which includes filing for eviction.
DO YOU PAY THE BILLS FOR ME?
We can pay your insurance, mortgage, homeowner’s fees, etc. There must be sufficient cash flow from the property to cover such expenses and we will ask you to set-up an additional reserve fund for this purpose which will allow us to make prompt payment for you without waiting for the rent to arrive.
DO WE REQUIRE SPECIAL INSURANCE, OR DO YOU INSURE MY PROPERTY WHEN YOU MANAGE IT?
You need to contact your insurance agent and explain that the property is to be rented. We require that clients also take out what is normally called a “Rental Dwelling Policy.” You will continue to maintain your own insurance coverage. However, we will gladly recommend insurance companies for you that we have worked directly with. We also ask that you add Prime Resource Property Management Inc as additional insured so that both of our interest is protected. With your authorization we can handle the entire process for you.
CAN YOU GUARANTEE THAT OUR HOUSE WILL NOT BE DAMAGED?
Nobody could give a guarantee of this nature. However, we do our best to ensure your property is looked after. We do regular inspections and if there is a problem, we bring it to the tenants attention and then follow up to see that it is rectified. If at the end of the tenancy something is not right we will apply all costs of damages to the security deposit. If any funds still need to be applied, we send notice to the tenant requesting the difference. If no reply is received in 30 days, we start a civil suit proceeding which can be costly. Owners need to be aware that there will be normal wear and tear on the property and at times accidents can happen.
DO YOU HANDLE PROBLEMS LATE AT NIGHT AND ON WEEKENDS?
Yes. Our automated 24-hour emergency line answers all calls and will page us in case of an after hours emergency. We will talk with the tenant to determine how best to proceed. Many times we can solve the problem over the phone, saving you the cost of an emergency repair.
WHAT IS THE AVAILABILITY ON WEEKENDS AND AFTER HOURS?
We effectively operate 7 days a week. Our office is open between 9am – 5pm Monday to Friday. Should a tenant have an emergency after hours or on the weekend, our automated line answers all calls and will page us in order to respond. We will talk with the tenant to determine how best to proceed. Many times we solve the problem over the phone, saving you the cost of an emergency repair. The office is not open during the weekends, as these are the main days for showing prospective tenants through properties. Responses to advertising happen even when the office is closed.
WHAT IF I DECIDE TO SELL HOUSE?
You can place your property in the market while tenanted. However, there are processes under the Tenancy Act that must be followed, and we can advise and follow these through for you. It is important that you have a real estate agent that is a good communicator (we have in house agents who are versed in current Real Estate transactions), we can organize showings with the tenants. It is important that all parties work together in this process causing as little disruption for all parties involved. As an incentive some owners have reduce the rent for the tenant while the property is being marketed.
HOW SOON CAN PRIME RESOURCE PROPERTY MANAGEMENT, INC. START MANAGING MY HOME?
We can start the process immediately. We will start by obtaining some information about you and your property and helping you decide if we are a good fit for your needs.