Ampersand Property Management

Ampersand Property Management provides and manages rentals in the Billings area.

What Can My Security Deposit be Used For?

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When you move into a rental unit, the landlord will typically take a sum of money called a security deposit. This amount is sort of like collateral on a loan – the landlord holds it as security for the property, and when you move out, it’s returned to you.

Having said that, security deposits aren’t always returned. If you damage the property or fail to clean it after receiving notice, the landlord can use that money to correct the issues. If the amount of the security deposit is insufficient to cover the costs, the landlord can actually pursue you for the balance.

Here’s an example: As you’re moving your bed frame out of the unit, one of the corners scratches the wall. If you move out and leave the scratch, the landlord can hold your security deposit, call in a repair guy, get the scratch fixed and painted, and use the security deposit to pay for it. The landlord has 30 days to get the security deposit back to you if there are deductions.

Or let’s say you’re in a time crunch moving out and you don’t have time to complete every detailed thing on the cleaning notice the landlord gave you. She can hire a cleaning company and use your security deposit to pay for those services.

Maybe in the frenetic activities of moving out, you accidentally pay your rent late. You send in the regular rental amount and hope your landlord will forgive the late fee because it’s your last month. He can deduct the late fee from the security deposit.

Since the security deposit is used to cover so many things, most landlords won’t accept it as your last month’s rent. If they did, and you left the unit dirty or there were damages, the landlord would have to take the time to sue you for the money needed to cover those charges. That’s not beneficial for anyone.

If you want to see the full amount of your security deposit back, read over the condition report you created when you moved in and make sure everything is in the same condition when you move out. Take the time to clean all the items listed on the cleaning requirements notice. Your landlord will have only good things to say about you, and if there are no deductions, he’ll get you the security deposit back in 10 days. That’s a good deal for everyone.

Why Sign a Lease?

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When you find a home you like, the owner or management company will most likely have you sign a lease before they let you move in. If you’re wondering if all those pages of legal mumbo-jumbo are necessary, here are some reasons you can be glad that you’ve got a lease in place.

A lease lists the basic details of the rental agreement. You can check your lease if you want to make sure you’ve got the rental amount right before sending in payment. You can look up the landlord’s address or phone number if you drop your phone in the hot tub and fry your contact list. A lease will also provide the amount you’re required to pay as a late fee if you forget to pay rent on time.

A lease details the landlord’s responsibilities. If you’re wondering who pays for the electricity, it’s in your lease. If you’re wondering whether the landlord is required to fix the broken handrail, it’s in your lease. You can refer to this document time and time again if you’re trying to remember whether the landlord said he’d take care of the yard work.

A lease details your responsibilities as a tenant. There are a lot of details discussed when you move into a new home, and chances are you won’t remember all of them. That’s why those details are written out in the lease. Do you have to replace the batteries in the smoke detector or should you call the landlord to do that? Is it your responsibility to change the furnace filter – and how often does it need to be changed? Do you as a legal tenant have the right to sublease the house to someone else? Chances are, these questions will be answered in your lease. If it’s not written down and signed by both you and the landlord, then you can’t be held responsible for it.

While a lease might seem boring, it’s good to read it and pay attention to what’s required of you. If you sign the lease and then break it – even accidentally – the landlord can take action against you. You may be required to move or pay damages. It’s worth your while to know up front what each party will be responsible for. That way you can keep your end of the bargain, and you can keep the landlord accountable for his part.

Is That Legal?

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The following information is drawn from the Montana Landlord Tenant Act of 1977. It’s not actually legal advice; it’s just a recap of the law. The actual law is online if you’re wondering about any specifics.

Is your landlord legit or villainous?

If your rent is late, can a landlord really tell you that you have three days to pay up or move out? How much time does a landlord get to take care of a maintenance item? What if you’ve got to move – how can you get out of a lease?

When you enter into a rental agreement, a lot of things are specified in that agreement. The due date for rent, the amount of the late fee, when that late fee is applied – all these are likely spelled out. But some things aren’t made clear in a lease, like what exactly happens if you can’t pay rent. So here’s an explanation:

If you can’t pay rent, let your landlord know. She might be able and willing to work with you. But she doesn’t have to work with you.

Let’s say your rent is due on the first and late on the third. If she doesn’t have your rent in her mailbox on the third (please note that this is not you sending out mail on the third; it has to arrive by the third), she can send out a Three Day Notice.

When you get that notice in the mail, you have three options. You can come up with the rent during that three day period and get it to your landlord. You can move. You can ignore the notice. ¬†Ignoring the notice is always a bad choice. If you do take that route, you might end up getting evicted. Then you’ll be out, searching for a new rental, and no landlord will accept you because they’ll talk with your previous landlord who’ll tell them how she just had to evict you.

Face reality. If you need to find a cheaper place, be honest and get on it.

What about a maintenance issue? You can send written notice to your landlord specifying the issue (read your lease to make sure it’s your landlord’s issue to take care of and not your responsibility). In this written notice, you can say that you’re terminating the lease 30 days after the landlord receives the notice if he doesn’t fix the issue in 14 days.

If he does fix the issue within those 14 days, the lease remains valid. If he doesn’t fix it, you can leave because you gave notice. An emergency issue has to be dealt with in 3 days instead of 14. Emergencies aren’t explicitly designated, but might be something like a furnace breaking during the middle of winter, a leaking pipe that’s causing flooding, or no water to the property.

Remember to give notice in writing for this to work! And of course, you don’t have to leave. If it’s a kind of minor issue, you’re welcome to allow the landlord to take a longer time, but you aren’t required to.

If you get a job located in another town, you may be required to move before your lease period is over. If you’re on a month to month lease, submit your 30 days’ notice in writing to the landlord as soon as you know you’ll need to move. If you’re on a longer lease, you can’t end it by simply giving 30 days’ notice. But do provide your landlord with notice. Explain the situation and provide the date you’ll be out.

The landlord will need to find a new tenant to fill your place, and it’s in your best interest to cooperate with him. Clean the unit, tidy up clutter, and try to have it generally available for showing. It’s not convenient when you’re trying to pack and get everything arranged, but the sooner the unit is re-rented, the better off you’ll be.

If the landlord finds a tenant to replace you who wants to move in the day after you move out, you won’t owe rent for the remaining balance of your lease. If the unit is unrented, however, you will owe rent for as long as it’s vacant. For example, if you move out two months into a year-long lease, you’re still contractually obligated for ten months’ rent. If the landlord finds someone to move in a month after you move out, you’ll only owe for the month it was vacant.

If you’ve got questions about landlord or tenant requirements or timelines, let me know by commenting or shooting an email to Chrissie@AmpersandPropertyManagement.com, and I’ll do my best to answer you.

Why Use a Property Management Company?

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How will you travel if you're stuck taking care of property?

If you own investment property, you know that cash flow is king. Using a property management company costs you some of that cash each and every month, so why wouldn’t you just do the work yourself? If that thought has crossed your mind, a list of reasons is presented below. Depending on your goals and position, it may make more sense for you to do the work yourself; for many, the additional expense is worth it.

Accessibility – If you own investment property in another state, it’s likely well worth it for you to hire a local property manager. You can’t drive by the property so easily, but they can. You can’t meet tenants and explain the rules, but they can. You can’t quickly respond to an emergency, but a local property manager is there to make sure everything’s taken care of.

Legality – Are you up-to-date on the latest local, state, and federal laws? Do you know when you have the right to evict a tenant? Do you know what notices you’re required to give, how you’re required to present them, and when they should be sent? Are you breaking the law that carries a fine of $37,500 – per day? If you’re not able to keep up with the latest legislation, it might be in your best interest to hire a property manager.

Time – You might have a job that you need to show up at everyday. You might simply prefer to do what you want instead of chasing tenants or coordinating repairs. Whatever it is you’ve got to do, you’ll have more time to do it in if you hire a property manager.

Peace of mind – Is the lawn mowed? Did the tenants send the rent like they said they would? When will you find time to show that vacant unit? What if it doesn’t rent? Is the roof okay after the hailstorm? If you’ve got a property manager, you don’t have to wonder. Someone else is responsible, and you’re free to do what you want.

Realistic investors understand that any asset must be properly maintained–you’ve got to feed the goose that lays the golden eggs. Hiring a property manager is a cost, but one that gives you freedom. Is it right for you? To find out more, email chrissie@ampersandpropertymanagement.com.

Choosing a Good Rental

As a renter, you may not be able to be picky about where you live. If you need to find a place by the first, you sometimes have to take what you can get. But even if you’re pressed for time, you don’t want to end up living in a dump. Moving is expensive, so if you can find a place to stay long-term, you’ll keep some cash in your pocket.

Make sure the rental unit is in good repair.

The biggest indicator of quality is the property’s condition. Condition will also tell you about the landlord – deferred maintenance may mean the landlord doesn’t care properly for his units. Here are some things to look for:

Roof – Does it appear to be in good shape? Are there shingles missing? Are the shingles curling or split?

Siding – Is there peeling paint? Is it dented, missing, or broken? Is it swollen or rotten in places?

Gutters and downspouts – Are they present and intact?

Sheetrock – Are there big holes in the walls or ceilings? Is there any water damage?

Paint – Is the paint in good condition? Are there scuffs or dirty spots?

Smoke detectors – Are they present and do they work?

Carbon monoxide detector – Is it present and does it work?

Handrails – Are handrails present in stairwells? Are they stable?

Stove – Do all functions work properly?

Sinks and tubs – Do all sinks and tubs drain well?

Window coverings – Are they present and in good condition?

Refrigerator – Is it in good working order?

Dishwasher – Do all functions work properly?

Toilets – Do all toilets flush and refill effectively?

Flooring – Is the flooring clean and free of rips, burns, or other defects?

Doors – Are all doors present? Do they open and shut easily?

Closets – Do all closets have rods or shelves and all the necessary hardware?

Water heater – Does the water get hot in a reasonable amount of time?

Furnace – Does the heat kick on quickly? Is it effective?

Plumbing – Is there any evidence of leaks (water stains under sinks, soft subfloor, wet sheetrock)?

 

When you look at a rental, you should be able to look at these things and test them. It may take some time, but this will be your home, so it’s best to know upfront if everything works.

If you find anything to be damaged or deficient, ask the landlord when it will be fixed. If it’s not going to be fixed immediately, decide if that’s something you can live with. If the landlord gives you a date in the future for the issue to be fixed, have him put it in writing so you can remind him of it at the proper time.

Depending on the issue and your skills, you may be able to get discounted rent in exchange for fixing the issue–some landlords waive a security deposit in exchange for cleaning, for example. You can always propose a deal; you might get a bargain.

Email us at AmpersandPropertyManagement@gmail.com if you have any further questions about choosing a good rental, and we’ll do what we can to find you an answer!