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Today is an exciting day for the Avail community! Realtor.com®, a leading online destination for real estate services, has acquired Avail.
Since launching Avail 8 years ago, we’ve been working hard to improve the rental experience for landlords and tenants by providing tools, educational content, and amazing customer service.
Over time, Avail has evolved to respond to the needs of our growing, diverse community. Together, with your help and input, we’ve made Avail stronger. Today is another step in the journey.
By joining realtor.com®, we’re combining the leading platform for DIY landlords and tenants with realtor.com®’s outstanding consumer experience. Landlords will have access to best-in-class tools and resources and renters will have a one-stop-shop for finding, securing, and living in their new space.
What’s Changing
While this acquisition is an exciting milestone for our team, we don’t expect any immediate major changes with the Avail brand, online tools, or resources. Our entire 30+ person team is joining realtor.com®, and we remain committed to providing you the same quality tools, resources, and service you’ve come to expect and appreciate.
What This Means for Existing Avail Landlords and Renters
In short, nothing with your account changes. You can continue using all of the tools you’ve come to rely on, and continue paying and receiving rent as normal. The way you access your account, your account settings, and all your account information will remain intact. Moving forward, we’ll continue investing in the platform, building out new functionality, and making other changes based on your feedback.
What Does This Mean for Future Avail Landlords and Renters
If you’re not currently an Avail landlord or renter, you should sign up now. Avail is consistently the highest-rated online platform for DIY landlords across the U.S. and basic functionality is free for landlords, regardless of how many units you own or manage. Landlords benefit from time-saving tools and tenants benefit from a digital experience they love. One of tenants’ favorite parts of Avail is that we automatically report on-time rent payments to TransUnion.
How realtor.com® and Avail Lead in 2021
We believe in a future in which renting a home and managing a rental can be a positive and rewarding experience. With the realtor.com® brand and digital properties, we’ll be able to help more landlords and tenants achieve their real estate goals.
“This acquisition is a key part of our strategy to make finding a home easier and more rewarding,” said David Doctorow, CEO of realtor.com®. “We believe that Avail is uniquely positioned to meet the needs of the DIY landlords and tenants in a large, growing and underserved market. By combining Avail’s rentals listing content and easy-to-use tools with realtor.com®’s large audience, consumer experience platform and insights, we believe we can deliver more value to DIY landlords and tenants. I’m excited about what the tremendous team at Avail will add to the talented staff here at realtor.com®.”
Q&As for Avail Customers
- Does this mean Avail will continue improving the platform?
- Yes, we will continue improving the platform – only faster now as part of realtor.com®. We have several enhancements planned and we’ll be releasing new functionality next year to improve landlords and tenants lives. Our 30+ person team is staying intact so will receive the same level of support.
- Will prices increase?
- No, there are no planned price changes. Basic functionality will remain free for landlords no matter how many rentals they own or manage.
- Will I still access my account the same way?
- Yes, your login information is the same. You will continue to log in at avail.com/login.
- What will happen to the existing Avail features?
- You can expect to continue using the same rental management features that have always existed. The acquisition means our team will not only keep the same features we have today, but it also will enable our team to add more features and to improve the platform, faster than ever.
- Will Avail still offer live customer service?
- Yes. Avail customer hours will remain seven days a week by phone, chat, or email.
- Will customer service contact information remain the same?
- Yes, contact information will remain the same. You can reach our team of experts by phone at 312-292-9347 or by email at support@avail.co. You can also visit Avail.co and use our live chat widget for real-time support.
- What happens with my data?
- Your data will remain safe and secure at Avail. We take privacy very seriously and maintaining your privacy is one of our top priorities. All of your account information will remain intact and secure.
To contact customer service with questions email support@avail.co.
For press inquiries email press@avail.co.
Read the full press release directly from realtor.com®.
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One of our most requested features from landlords is the ability to export rent payments to a spreadsheet. This is helpful for you and your accountant when preparing taxes, and with tax season just around the corner, we want to show you how to easily download a spreadsheet of your rent payments.
Here’s what the report will include and how to find it in your Avail account:
The Payment Report
Your rent payment report is automatically generated for you when you collect rent online with Avail. If you don’t collect rent online with us, you can manually add your rent payments to your Avail account and generate this report.
As you can see above, the report includes:
- Tenant’s Name
- Street Address
- Unit Number
- Date Paid
- Payment Amount
- Payment Status
Where to Find Your Report
You can log into your account to find your rent payments report. Once you’ve logged in, you’ll see your dashboard. As you can see below, you can download the report directly from your dashboard under the “Reports” tab.
When you click “Download Report,” you’ll receive a .CSV file that will open in Microsoft Excel.
Tax Deduction Tips
Join us for Tax Tip Tuesday across our social channels, where we provide need-to-know tax tips and information for DIY landlords. Follow us at @HelloAvail.
What’s Next?
Need to simplify tax season? Start collecting your rent online with Avail to automate your year-end rent reporting and access all your rental property tax information in one place.
Learn more about the benefits of collecting rent online.
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Next Wednesday, June 22nd, we’re kicking off a series of exciting updates for tenants who use Avail to complete rental applications, sign leases, pay rent online, and create maintenance requests.
The first change that users will notice is an entirely new tenant layout (see screenshot above). This new layout places important account-level information in a menu bar on the left side of the screen. These items should be easily accessible, and now they will be.
Over the coming months, we’ll be making several more updates to benefit our tenants. The changes we have planned are based on our experience working with tens of thousands of tenants over the past three years.
The updates that you can expect from us include:
Faster, Simpler Payments Interface
Paying rent online with Avail is faster and more secure than mailing paper rent checks. The newly designed interface will make it even easier to schedule one-time payments or to set-up automatic rent payments. You’ll still be able to pay rent with a checking account, debit card, or credit card.
Better Bank Account Management
Tenants often want the ability to have multiple bank accounts connected to their Avail accounts. You’ll now be able to add more than one bank account and easily make payments from each bank account you’ve added. Deleting bank accounts will also now be a breeze.
Super-Charged Renter Profile With LinkedIn Integration
In the coming months, we’ll be rolling out a new Avail Renter Profile. This profile will become the one place for tenants to track their rental history and other items that landlords use to evaluate potential tenants.
To eliminate the need for you to manually enter your employment information, we are integrating with LinkedIn so that you can get your employment information with just a few clicks.
Your Avail Renter Profile will provide a detailed record of your rental history. We’ll automatically add the information from leases you sign inside Avail.
Improved Application Sharing Capabilities
The rental market in the United States continues growing faster than ever. The supply of properties isn’t keeping up, which means demand for available units is at record levels.
As the market becomes more competitive, we see tenants frequently apply for more than one rental unit. To help tenants avoid paying multiple application fees, we allow you to share your completed rental application with an unlimited number of landlords for free.
Never again pay multiple application fees. Never again fill out the same form multiple times.
Better Control Over Applications and Personal Data
The ability to share your completed rental application with multiple landlords is great, but being able to revoke access to this personal information is just as important.
Within your Avail account, you’ll be able to easily toggle who has access to your rental application and who does not.
Mobile-optimized Interface
Smartphones and other mobile devices are becoming more important every day. Our new interface is designed to work perfectly from any device – phone, tablet, laptop, or desktop computer.
It’ll now be as easy to pay your rent from your phone as it is to order your Grande Triple No-Whip Mocha from Starbucks.
Cloud-based Move-In/Move-out Checklists
As a tenant, when you’re moving into a new rental unit, it is important to accurately document the condition of the unit before you move in. This helps ensure that you are not penalized for pre-existing damage when you move out.
To help make this process as simple as possible, you’ll now be able to document the move-in condition within your Avail account. If you complete the move-in checklist on your phone, you’ll be able to access your phone’s camera to take pictures of the condition before you move into your new home.
All of this information, including any photos that you take, will be securely stored in the cloud for easy 24/7 access.
When you move out of the rental property, it will be just as easy for you to document the condition of the unit.
By making it easy to document the condition of the rental property before you move-in and after you move-out, we’re putting an end to the he-said-she-said nonsense that occurs with antiquated paper checklists.
Seamlessly Move Between Properties With Greater Lease Tracking
Tenants love living in properties that are managed by Avail landlords. The reason? These landlords utilize technology to make renting easy. Rental applications, leases, and payments are now as simple as a few clicks online.
Many tenants love the experience so much that they promote Avail to their next landlord. In our updated interface, you’ll be able to store all of your rental history and lease documents in one place, making it easier for you to move from property to property. Welcome to renting in the 21st century.
Powerful Maintenance Ticketing and Tracking
When renting a home, it’s frustrating when things break or go wrong. To help you communicate issues to your landlord, we’re making it even easier for you to create maintenance tickets.
If you’re using a smartphone, you’ll be able to access the phone’s camera app to capture photos and videos of the issue.
We’re also making it easier for you to track the status of your open maintenance and repair requests.
Our entire team at Avail is excited to release these new features and functionality for you. We’ve spent countless hours speaking with our tenants to understand their biggest pain points and even more time brainstorming potential solutions.
In the coming months, we’ll be reaching out to let you know of further changes and what other exciting features we’re working on.
If you have any thoughts, feedback, or suggestions on ways that we can continue improving our product for you, please let us know.
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]]>The post New Avail Leasing Interface and More Customization Options appeared first on Avail.
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Creating and signing lease agreements is one of the most confusing and expensive parts of being a landlord. There are often different state and local laws that landlords must follow. Rather than navigate these laws themselves, many do-it-yourself landlords hire an attorney that costs hundreds of dollars per hour.
In addition to the confusion and expense, landlords hate the amount of time it takes to track down tenants and co-signers for signatures.
When we launched Avail in 2013, we knew leasing was a pain, but we didn’t expect our digital lease feature to be one of the most popular parts of our landlord software.
Landlords love that they can start with our state-specific templates, edit the terms and send the lease to tenants online. Landlords and tenants are then able to sign the lease electronically to create a legally binding document. Check out 7 reasons why you should sign your lease online.
Now, three years after launching our online leasing, and armed with feedback from more than 20,000 landlords, we’ve decided it’s time to make some important updates to our leasing process.
Start With State-Specific Templates
Residential leases, unlike a lot of contracts, are relatively straightforward. In simple terms, the tenants agree to pay a certain amount to use the landlord’s property for a set period of time. To help you avoid having to re-write the same standard terms and rules that already exist, we had a real estate attorney create state-specific lease templates for our landlords to use.
The next time that you create a lease with Avail, our system will automatically pick the right template based on what state your rental unit is located in. These templates have been saving landlords thousands of dollars since 2013.
Step-by-Step Leasing Wizard
Creating a lease contract can be a daunting task, but it doesn’t have to be. To make things easier on you, we’ve developed a wizard that guides you through the simple process of creating an electronic lease with Avail.
The wizard breaks the process down into 7 easy, logical steps and asks you simple questions, such as, “What’s the lease start date?” Our high-tech algorithm then takes your plain-English answers and magically translates them into complex legal syntax that lawyers get paid big bucks to write. We also offer helpful tips along the way.
We also offer an easy way to renew your lease: just click ‘Renew Lease,’ update the lease dates, and then both parties digitally sign.
Better Attachment Functionality
Responsible landlords often add a welcome kit or a new tenant orientation document as lease attachments. With our new attachment uploader, you’ll be able to add anything that you want to help welcome new tenants to your rental property.
Whether you want to upload welcome documents, tips for connecting utilities, or your condo association rules document, you can now easily do so.
Edit the Lease Terms in Preview Mode
After starting with our state-specific lease templates and updating the details by using our leasing wizard, you’re all done, right? Not quite.
Before sending the lease to your tenants to sign, it’s always best to thoroughly read and re-read the lease. If you notice anything in Preview mode that needs changing, you can simply click on the item and make the change. There’s no need to go back into the wizard to make your edits.
Customize Anything in Preview Mode (Pro Feature)
Our state-specific lease templates and pre-written rules are all that you need to create a legally binding lease document for your property. Occasionally, though, landlords want more control over exactly what is in the leases and rules.
To address this, we’re now giving you the ability to edit anything in the lease document. Making this functionality possible took our team countless hours of coding time. Because of how much time and money was invested in creating this, we currently only offer this feature to users on a paid pricing plan.
More Transparency into Signing Status
Want to know exactly what’s going on with the signing process? With our new lease functionality, you now have full transparency into which tenant(s) have created accounts, viewed the lease document, and signed the lease.
New “Draft” Status
One of the things that we’ve learned since 2013 is that landlords are not procrastinators. Many landlords want to get things ready as early as possible. In fact, the other day, I spoke with someone who signed up for our service because they are buying an investment property this summer!
To meet the needs of these overachieving landlords, we’re giving you the ability to create and save a draft lease at anytime. You don’t need to know the specific dates, rent amount, or tenants to get started. The changes that you make to your lease will be saved for you to use whenever you’re ready to finalize things.
Download Print-ready PDFs
An electronic version of your signed lease agreement is permanently saved within your Avail account. You can access this stored document 24/7 from anywhere in the world.
Although the electronic copy exists, many owners still like the sense of security that comes with printing a hard copy of the executed lease document. As soon as the lease is finalized, you’ll be able to easily print a PDF version of the lease.
Upload New Documents Anytime (Even During the Lease)
Landlords who use Avail are some of the most organized people I’ve come across. I’m sure there’s a lot of overlap between our users and customers of the Container Store. To help keep all of your documents together, we let you upload new attachment documents to your lease at anytime, even after the lease has been finalized.
Landlords are already using this capability to upload tenants’ proof of renters insurance and to upload PDFs of late-rent notices.
Improved Tenant Messaging
Frequent, open communication between landlords and tenants is the easiest path to a great renting relationship. To make this easier on you, the landlord, we’re now giving you the ability to send messages to your tenants from within the leasing interface.
You can send messages to your tenants to request signatures, remind them about pending leases, or send updates on the lease status. We’re certain that your prospective tenants will appreciate these updates from you, and it will start your renting relationship off on the right foot.
Visual Design Improvements
If you’ve been using Avail for a while, you’ve probably noticed the improvements that we’ve worked on. In November, we introduced an entirely new landlord layout and last month, we introduced an updated rental listings interface.
While most of our efforts go into making our product more useful, we do spend time thinking about how to make the product more visually appealing. We want our product to be a joy for you to use.
Applications to Leasing to Rent Collection, As Easy As Ever
Landlords who use all parts of Avail save the most time and money. A lot of this has to do with how our product is built to seamlessly send information from one step to the next.
For example, you can use Avail to screen prospective tenants with our online rental applications and TransUnion credit and background checks. As soon as tenants complete these reports, they’re available in your account. You can review these, then quickly click ‘Accept’ to start a lease with these tenants. Their names and contact info will automatically be transferred onto the lease.
After everyone signs the lease, the next step is to collect rent payments. You’ve already entered information on the payment schedule, so our system automatically sets up the series of charges that your tenants can pay online with a bank account or credit card.
This new listings interface is one of many upgrades that our team is working on now. At Avail, we empower landlords by giving them access to the tools and knowledge they need to make renting easy.
If you’re a landlord, but not currently using Avail, you can save yourself a lot of time by signing up here. If you have any questions, please let us know.
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]]>The post How to Set the Rent Price for Your Rental Property appeared first on Avail.
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As the owner of a rental property, your goal is to maximize the amount of profit that you receive from your single-family home, condo or multi-family building.
The rent that you collect from tenants pays your mortgage, taxes (ugh!), insurance, maintenance and building your reserve fund for bigger repairs. In the end, after paying all of the expenses associated with the property, you hope to have money left over to compensate you for your time and to save for that next rental unit that you want to buy – your profit.
On the flip side, tenants want to pay the lowest amount possible and have lots of options of available properties to rent.
This contrasting dynamic creates a lot of confusion and oftentimes leaving landlords wondering, “How in the world do I set the right rent price for my rental unit?”
Since co-founding Avail in 2013, I have worked with thousands of landlords from all across the United States. The question of pricing comes up all the time, and I have developed several tips for nailing the pricing equation to maximize your profit.
Timing is Critical
In real estate, it’s often said that the three most important things are location, location, location. To be an efficient and profitable landlord, I’d argue that the three most important things are time, time, time and here’s why:
Seasonality (time of year) impacts rent prices
Rent prices are largely dependent on how much demand there is for rental properties in your area.
Across the country, demand for rental properties is highest in the summer months. Demand peaks in the summer months because people dread moving in the middle of winter, especially in northern states where moving in winter entails hauling furniture through snow drifts in sub-zero temperatures. The second reason that demand is higher in the summer is that families don’t want to disrupt their children’s schooling.
Just like demand for rental properties is highest in the summer, rental prices tend to be higher in the summer months. If you are looking for tenants in the summer, you’ll probably be able to get tenants to agree to a higher rent amount than you would in the winter.
By keeping this in mind, you should try to ensure that any new leases you enter into expire in the summer months. If your property currently has a winter expiration, you may want to negotiate a three to six-month extension with the tenants to get on a summer vacancy cycle. If this doesn’t work, you may want to make your next lease 15 or 18 months long to ensure that your next vacancy falls in a high-demand season next time.
Days to Vacant
One surefire way to lose money on your rental property is to have the property sit vacant. Having a property sit vacant is so painful that you want to always know the Days to Vacant for your property. This metric is actually as simple as it sounds: a count of the number of days until the rental property is vacant.
The lower your Days to Vacant becomes, meaning the closer you are to having a vacant unit, the more desperate you’ll become and you’ll likely be willing to accept a lower rent.
To avoid a vacancy and to maintain strength in negotiating with tenants, be sure to start the lease renewal and tenant search process as early as possible.
You should always contact your existing tenants 90 days before the existing lease expires to begin the renewal conversations. If the existing tenants decide not to renew the lease, you’ll be able to start showing the unit to new prospective tenants 60 days before the existing lease expires (in most situations).
By starting the renewal and tenant search processes early, you’ll give yourself ample time to advertise your property and find great tenants. For tips on how to find stellar tenants, read this.
Starting the tenant search process early will help you avoid stress, but it also allows you to start with a high asking rent price. If you don’t receive as many leads as you need to find a qualified tenant, you can always lower the rent amount. Starting early gives you the time to gradually lower the rent, if necessary.
Maximizing Rent IS NOT the Goal
Your goal as a landlord is to maximize the profit earned from your rental. Maximizing profit, though, doesn’t always mean agreeing to the highest rent price with your tenants.
To maximize your profit, you need to find tenants who will pay rent on time and will take care of your property.
Sure, you may be able to get a signed lease with a higher rent from a bad tenant, but it’s not worth it. Sacrificing a bit on the rent amount to get good tenants will pay off in the long run. These good tenants won’t cause headaches for you and won’t cause disturbances for your neighbors.
To learn more about screening tenants and picking the right tenants to rent to, check out our 5 part guide to tenant screening.
Setting the Rent Price
Now that we know the implications of timing on the rental market and the importance of finding quality tenants, let’s talk about the specifics of setting the rent for your home.
To understand how much your rental property will fetch in monthly rent, I recommend you spend time studying comparable units that are on the market. You’ll want to be sure you’re looking at units of similar size, with similar features in your specific area.
Limiting your research to properties in your local market is important because prices can vary dramatically based on location. A single family home in Anchorage, Alaska doesn’t rent for the same amount as the same home in Austin, Texas. Even within cities, the rent prices for the same size and type of unit can vary wildly.
Even if you can’t find a long list of identical properties, studying other properties on the market is the best place to start. After developing your list of comps, or comparable units, you can make adjustments for differences between the comp and your unit. For example, perhaps your home includes a washer and dryer, but none of the comparables do. If the comparables are renting for $1,200 per month, your unit with the washer and dryer should command a higher rent.
To find comps, you can use any of the online rental sites, such as Hotpads, to find units in your area that are for rent.
Several websites, including ours, are developing algorithms to estimate the rent prices for various properties. The most established of these estimates is Zillow’s Rent Zestimate.
As I touched on earlier, the rental market is subject to the economic principles of supply and demand. As the seller of a product (housing), the more demand that you create for your property, the higher the rent you’ll be able to demand for the property.
To create demand for your property, you can certainly lower the asking rent amount, but this is opposite your goal of maximizing profit from your unit. So what else can you do? Well, you have plenty of tools for increasing demand.
For starters, be sure to advertise your rental property everywhere that interested tenants may find it. I’m biased, but I recommend our automated rental listings feature. The average landlord who uses this part of Avail receives 15-20 leads per vacant unit.
Another tip for creating demand is to create a sense of urgency amongst interested tenants. You can do this by scheduling multiple showings of the unit at the same time. When multiple tenants show up to see your unit at the same time, they’ll feel like they are competing for your unit. This increased demand will encourage interested tenants to act quickly and to pay the asking rent amount.
The Price-Value Relationship
The amount of rent that good tenants are willing to pay for your rental property is largely a result of the value that these tenants believe they’re receiving.
One way to increase the rent that you receive from tenants is by increasing the value that you deliver. Landlords are oftentimes able to increase their profit by increasing rent more than the cost of value they’re delivering. Here are three potential ways to increase profit by delivering more value:
Utilities Included!
As a landlord, you have an unfair advantage of knowing the historical utility costs for your unit. If the average cost of utilities per month has been $120, you might be able to increase the rent by $150 per month by including the utilities in the monthly rent. Your profit just increased by $30/month!
Tip: If you decide to do this, be sure to clearly outline what utilities are included in the lease agreement. You’ll also want to clearly outline any restrictions on how the utilities can be used.
New Appliances!
Tenants prefer living in nice places with new appliances. As a landlord, you may be able to increase your profit by investing in, and upgrading, your rental unit. I spoke with a landlord recently who was able to increase his monthly rent $50/month by installing a brand new stainless steel refrigerator that cost him $800 at Home Depot.
Furnished!
Depending on the type of rental property you own and the demand in your area, you may find it advantageous to rent your property fully furnished. There are companies that rent furniture, or you can invest in buying low-cost furniture from a retailer like IKEA. Because furnishing a property can be quite costly, you’ll want to carefully analyze this option.
There are many more ways to increase the profit from your property by delivering greater value. It is widely documented that consumers–all of us–oftentimes make irrational decisions about price and value.
The Importance of Emotion
It shouldn’t be a surprise to anyone that one of the biggest factors in tenants’ decisions of which property to rent is their emotions about the property. As a landlord, understanding the role of emotion on tenants’ decisions can help you increase the price and profit from your rental.
To increase rent and profit, you’ll want to ensure that you are marketing your property in the best way possible. You’ll want to ensure that you have great pictures of the property. You’ll also want to be sure you have a well-written description that attracts mobs of great tenants.
Finally, you’ll want to highlight that you’re an easy landlord to work with. Just like landlords fear renting to nightmare tenants, tenants are oftentimes worried about renting from a landlord who is tough to work with. Welcome your tenants into their new rental property with these 8 tips.
Tenants also want to do things digitally these days, including pay rent online. To save time, and to make things easy for tenants, consider using our property management software.
Diamonds are Forever, Rent Isn’t
One final thing to keep in mind regarding setting rent is that the amount isn’t set in stone, and can be adjusted over time.
To maximize the profit from your rental, you should re-evaluate your rent price at every lease expiration. While the topic warrants its own post (coming soon!), your goal should be to increase the rent as much as possible over time without creating tenant turnover (turnover costs time and money).
At Avail, we aim to help DIY landlords save time managing their rental properties. We do this by building beautifully designed software that automates the rental cycle.
In addition to building amazing landlord software, we have an outstanding customer support team that interacts with hundreds of landlords every day.
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]]>The post How to Read a Tenant’s Credit Report appeared first on Avail.
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As a landlord, choosing the right tenant is the most important thing that you will do. Picking responsible tenants helps ensure (but doesn’t guarantee) that your tenants will pay rent on time and take care of your investment property. Ask any landlord who has experienced renting to awful tenants — they likely didn’t properly screen the individuals before signing the lease.
Our tenant screening checklist covers all the steps in a good screening process, including a key part of the application process: obtaining and analyzing the tenant’s credit report.
We’ll help you understand how to read and interpret a tenant’s credit report so that you can use it to make an informed choice when selecting tenants.
What Is a Tenant Credit Report?
A tenant credit report shows important financial information and can help a landlord understand how a tenant has historically handled their finances and credit accounts.
Through Avail, landlords can request TransUnion credit reports from prospective tenants. These reports show a tenant’s credit score, as well as an individual’s detailed payment history for things like credit cards, auto loans, student loans, and mortgages.
Why Do Landlords Require Tenant Credit Checks?
Landlords require credit reports from tenants because it helps them see all of the other monthly payments the tenant is responsible for during the lease. When you rent your property to an individual, you are becoming a creditor — not dissimilar to making a loan to the individual. For the duration of the lease, the renter will owe you a monthly rent payment.
If a renter’s other monthly obligations plus the rent amount (due to you) exceed the tenant’s income, there’s a chance the tenant may not be able to afford the rent. On the other hand, if the tenant’s monthly payments plus rent are a low percentage of their income, then you can have greater comfort in the tenant’s future ability to make payments.
Additionally, credit reports give landlords an unedited view of how tenants have handled their financial obligations in the past. An individual’s past payment history is an excellent indicator of how they will handle payments in the future.
How to Read a Tenant’s Credit Report
Now that we understand what the credit report is and why it’s important, let’s examine the two main components: the credit score and the payment history section.
1. The Credit Score
The credit score that we provide for our landlords comes directly from TransUnion and is based on a proprietary algorithm developed by the credit bureau. The score exists on a scale of 300 (lowest) up to 850 (highest possible score), and is meant to be a single number that summarizes an individual’s credit history.
Unfortunately, the formula for determining the credit score is kept as secret as the special formula for Coca-Cola. While the calculation itself is not shared publicly, everyone agrees that the more financially responsible an individual is, the higher their score will be.
Many landlords put too much emphasis on the credit score alone. It’s easy to understand why — the credit score is a number, and it’s easy to look at our chart to understand where a number falls on the spectrum.
However, the next section of the credit report contains the majority of the useful information. It is more subjective and requires some judgment calls, but this extra effort will pay off when you have great tenants who always pay rent on time.
2. The Detailed Credit History
The second section of the credit report, the detailed credit history, is the most valuable part of the report for landlords when evaluating prospective tenants. This section of the report allows you to do two things: First, you will be able to understand what other monthly payments the tenant is obligated to pay, and second, you will get an idea of the tenant’s full payment history.
When considering whether to rent to someone, the most important question to ask yourself is whether the person is capable of paying the rent every month. An individual’s income is an important part of this equation, but equally important is how much money the individual is obligated to pay for auto payments, student loans, credit cards, etc.
Within the credit report, there will be a separate block of information for each of the tenant’s financial obligations. Within this block will be a line item that shows monthly payment. On a piece of scratch paper (or in your head), we recommend tallying up these monthly obligations, adding the rent amount, and comparing the total to the individual’s income.
3. The Payment History
Your next mission in analyzing a tenant’s credit report is understanding their payment history and whether they frequently pay bills on time. When you pull a tenant credit report through Avail, we make it easy to view this information by giving you a colored month-by-month breakdown of a tenant’s payment history. Months shaded green were paid on-time, yellow implies that the payment was late, and red means that the payment was never made.
You should be looking for long stretches of payments that have been paid on time. This can give you comfort, but not guarantee, that an individual is likely to pay rent on time every month.
It’s worth noting that rent payments are not typically reported to the credit bureaus, so the tenant’s history of paying rent will generally not appear on the credit report. However, Avail helps tenants build their credit with each on-time rent payment they make. This way, tenants get something in return for their sizable monthly payments, and they’re incentivized to pay on time each month.
How to Interpret Your Tenant’s Credit Report Information
When interpreting a tenant’s credit report, we suggest thinking about the potential outcomes like a stoplight.
- Green: Certain credit reports will be so good (high credit score, good payment history, etc.) that you can feel pretty confident about the tenant’s likelihood of paying rent on time and you can proceed to the next steps of the screening process.
- Yellow: In the middle, or the yellow part of the stoplight, are the tenants who could still be worth renting to, but require some additional questioning to understand the specifics of their credit report. For example, a tenant may have lost their job during a recession or pandemic and was unable to pay their bills.
- Red: Finally, tenants with poor credit in the red section of the stoplight may give you pause. In these cases, it’s legal to deny a tenant based on their credit report or lack of sufficient income. Still, it’s important to note that a credit report doesn’t paint the whole picture, and in some instances, it may be worth additional questioning or offering them alternative ways to show financial responsibility.
How Do You Set Credit Report Screening Standards?
It is important to emphasize that while the credit report contains a lot of useful, detailed information, you ultimately have to determine what standards must be met in order for a tenant to rent your property.
The standards you set for your property will likely depend on the demand for your property (the higher demand, the pickier you can be) and your risk tolerance (being too picky can cause a vacancy and potential lost rental income, while being too lax can result in a tenant who potentially can’t or won’t pay rent).
To set standards for your property, there are three variables you’ll want to consider: credit score, frequency of late payments, and outstanding debt (including the rent you’re expecting) relative to monthly income. These three variables are all related, but you may decide to put more emphasis on one more than the other based on your experiences or preferences.
It’s also important to note that in some cases, a tenant won’t have a high credit score for a variety of reasons. If you’re willing to let the tenant show other proof that they’ll be able to pay the rent every month (like income or savings), this can be a helpful screening alternative for tenants with low or no credit.
When Should You Use a Credit Report Provided by the Tenant?
In larger cities (and elsewhere), tenants are accustomed to applying for multiple properties before being selected by a landlord. In these more competitive markets, tenants will often obtain their own credit report to present to every property they are applying for. This saves the tenant money by minimizing application fees, which can really add up.
If a renter wants to use a credit report that they have already paid for (as part of another rental application), we recommend allowing this — as long as the renter could not have doctored or changed the report.
For example, Avail allows renters to pay for a credit report and background check and share the results with other landlords whose properties they are applying for. Our system keeps the renter’s credit report information in our system (securely encrypted) for 30 days after the initial application.
If the renter wishes to share these reports, they can invite the other landlords to view the reports inside our system. There’s no chance anything could have been changed or altered because the report was never in the tenant’s hands.
How to Get a Credit Report for a Tenant
Obtaining a credit report from a prospective tenant used to be nearly impossible for individual landlords and resulted in a hard inquiry that negatively impacted the tenant’s credit score.
Fortunately, the process is a lot simpler now. Rather than taking tenant’s personal information and manually entering it into a system, tenants can authorize soft credit checks that won’t negatively impact their credit score directly and securely through Avail.
Once the reports are authorized, they are automatically pulled and shared with both the landlord and the tenant in their Avail accounts. Landlords can quickly view the necessary information, and tenants can share their reports with as many landlords as they want.
Get started screening tenants with Avail and request automatic credit reports from tenants. Create an account or log in to manage your tenant screening and renting needs, all in one place.
The post How to Read a Tenant’s Credit Report appeared first on Avail.
]]>The post Avail Landlord of the Month: Caleb appeared first on Avail.
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Caleb is our third landlord to be featured in the Landlord of the Month series. In his quest to become a property owner, he stumbled into becoming a landlord. He now uses Avail for all aspects of managing his rentals.
How did you get into the business of owning rental properties?
I was entering my late twenties and wanted to buy a place of my own. I could only afford to buy a condo by myself, but condo living did not suit me at all. I had been living on the north side of Chicago with one of my best friends for 3.5 years in the first floor unit of a two unit house, and had grown fond of the little yard and deck we had, as well as the parking spot. I decided I wanted to continue living this way and stay in the city, but couldn’t afford to buy a free-standing building with these amenities. I immediately thought of buying a multi-unit building that would generate rental income to supplement the mortgage payment. Still, I did not quite have enough money for the required down payment, so I decided to solicit my single friends who would be willing to be roommates and landlords together. One of my friends agreed and seven months later we closed on a 3 unit, turn-key brick building in December 2010. We currently live in the first unit and rent out the other two units. It’s a pretty good living situation because I have my room and bathroom on the first floor, and the co-owner has his room and bathroom in the duplexed lower level. In preparation for the future, we developed multiple exit strategies such as selling the building on the open market, buying each other out, or holding and renting out the entire building, just to name a few. Over all, it’s been one of the best decisions I’ve ever made.
What has surprised you the most about being a landlord?
How much some repairmen charge and the subsequent money I would lose if I didn’t do some things myself.
How much time do you spend on your rental properties?
The most predictable, but most time consuming activity is spent getting new tenants. The longest time I’ve spent searching for a tenant (from existing tenant notification to new tenant signing) was 3 weeks, the shortest was 4 days, and I’ve averaged slightly less than 2 weeks. I’ve had success just using Craigslist, but it’s a fair amount of work communicating between all the prospects, as well as being considerate of the existing tenant in order to coordinate showings. Until a new tenant is signed, I average 3 hours a day between inquiry emails and showings. Regular maintenance for me is limited to yard work and snow removal. During the spring and fall I average 15 minutes a week and in the summer 45 minutes a week in yard work; in the winter, I average one hour a week shoveling and putting down salt. Since this is also my home, I don’t consider that type of regular maintenance extra work. Any other time I spend is on ad-hoc repairs, which if I can’t complete myself in a few evenings working a couple hours each night, then I hire a professional.
Did you ever consider hiring a broker or professional property manager to help?
I never considered hiring a professional property manager because that’s not necessary for only two rental units, especially when I live in the building. The idea of hiring a broker to rent out my units was completely off the table when I found out that brokers charge one month’s rent each time they sign a new tenant. For me, that’s too much money to spend for something that I can complete myself with a little work. It’s been over 3 years and both units haven’t gone a day without being under lease.
Are you looking to buy more rental property, or do you think you will in the future?
I’ll definitely buy more rental property in the future.
What’s the biggest mistake or regret that you have regarding your rental properties?
Not calling out the inspector we used for the purchase of the building. The co-owner met with him and told me the inspector did a thorough job, but he did not bring a ladder (we do not have any other way to access the roof) and we still paid him for his services without him inspecting the roof. I should have insisted that the inspector come back, but I think we got caught up in so much other closing stuff and we rationalized it because we had documentation from the seller of the roof’s last resurfacing from a few years prior. Turns out that the roof did not need any repair, but we may have been able to identify maintenance areas that could have been used to further reduce our purchase price.
What’s one tip or piece of advice that you want to share with other landlords?
Never pay contractors more than half for a job up front. Check all work completed before contractors leave and don’t be afraid to ask them to redo something that is not done right. Check the work again, then give them the final payment once you’re happy.
How do you deal with repairs and maintenance requests?
As mentioned, I only hire a professional if I can’t do something myself.
How does technology play into your rental business?
Craigslist and Avail are essential resources for my rental business.
Finally, you’ve been using Avail for over a year now. How has the software helped you?
One of the most critical pieces of any rental property is the lease, and Avail completely relieved my concern of using a lease that may not cover every necessary aspect by offering a lease template that has been reviewed by a legal professional and is compliant with all the rules and regulations of Illinois and the city of Chicago. The template is exactly what a landlord needs and is also customizable, so I can add anything I want. I really like that the lease can be signed electronically, which eliminates the need to schedule an additional meeting when new tenants are ready to sign and allows me to finalize the leasing process as quickly as possible. The software is designed so well that it even coordinates the electronic signatures of multiple tenants on the same lease before being sent to me for countersignature. Avail is a great organizational tool that has tremendously improved my record retention and accessibility to tenant files. Before Avail, I would have to be in my office and pull hardcopies in a filing cabinet just to check when a lease expires; now I can instantly check a lease from anywhere simply by logging onto the Avail website. Also, having a standard application that I can send to prospective tenants to complete online is another nice element I can use to collect all the basic information. The application does not require you to add the credit and background check feature, but I always include this option to be on the safe side, and it’s free for landlords because the prospect pays the fee. I love Avail’ online rent payment feature. Not only did it eliminate my trips to the bank to deposit checks, but it reduced the work for tenants to make payments as well. It’s more convenient for tenants to pay online from anywhere, versus dropping off or mailing a check. Using this software also allows me to receive payment sooner. Tenants can choose to login every month to pay or set-up automatic payment, which will obviously prevent a late payment. Furthermore, even if a tenant does not select automatic payment, I’ve found that late payments are no longer an issue because the system sends the tenant (and landlord) an email as a reminder to make the payment before reaching the overdue date and incurring a late payment fee. Avail has streamlined my rental business and made it much easier to manage in all aspects. I look forward to leveraging Avail as a scalable tool to help me expand with additional rental properties in the future.
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Elliot is the second landlord to be featured in our Landlord of the Month series. He uses Avail to manage the condo that he purchased prior to getting married. He has been a Avail customer for about 18 months.
How did you get into the business of owning rental properties?
I purchased a one-bedroom condo into the West Loop before I got married. After my wife and I moved into this condo together we decided that it was too small for the both of us. After finding a larger place to live, we evaluated the condo market and decided that financially it was better to rent out the condo than it was to sell it.
What has surprised you the most about being a landlord?
I have to say being a landlord is not as time consuming as I would have thought. Once we found a tenant for our condo, the only thing we have had to do is some minor upkeep of the condo. The key is to make sure to take care of any problems with your unit in a timely manner.
How much time do you spend on your rental properties?
I spent a few hours putting together a listing for the condo, showing the unit to potential tenants and fixing a few things before the move in. On a monthly basis, I spend about 30 minutes to make sure the rent payment was processed from the tenant and check email to see if there are any issues that need to be addressed.
Did you ever consider hiring a broker or professional property manager to help?
I considered hiring a broker until I learned about the costs involved. In Chicago, a professional manager will charge one month’s rent for finding a tenant and an ongoing 10% monthly management fee. For the little bit of time and effort it would save, I decided I could do it myself. The condo is close to my work and not too far from home.
Are you looking to buy more rental property, or do you think you will in the future?
I am looking for additional rental properties at this time. I will definitely use Avail for any further properties I purchase since it makes the whole process so much easier and has everything I would need to be a good landlord.
What’s the biggest mistake or regret that you have regarding your rental properties?
The biggest mistake would have to be not finding a handyman before renting out the unit. Having someone who is always available to fix small issues in your unit is key for any landlord. When there was an issue in our unit, I had to scramble to find someone to fix a broken sink at the last minute.
What’s one tip or piece of advice that you want to share with other landlords?
The best advice I would have is to make sure to properly screen any perspective tenants and to be selective. It is your property and you do not want anyone destroying it.
Editors note: Avail has blog posts with tips for screening tenants: Five Questions You Must Ask Your Potential New Tenants, Look Out for These Red Flags When You Show the Apartment to Your Prospective Tenant and The Landlord’s Ultimate Guide to Rental Applications
You have other landlord friends. What do you think they could do differently?
I think most people could do a better job pricing their properties according to current market rates. It only take a few minutes and you want to make sure you are pricing the property correctly to attract as many qualified tenants as possible.
How does technology play into your rental business?
The main technology I use is the Avail website for the initial lease, collecting monthly rent and much more. The website can handle everything from start to finish and I feel tenants expect landlords to use technology these days.
Finally, you’ve been using Avail for over a year now. How has the software helped you?
The software has helped to collect monthly rent, which I never thought of when becoming a landlord. In addition, it was helpful in creating and executing a lease that complies with the Chicago Landlord Tenant Ordinance. Overall there are a lot of features that can help any landlord.
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]]>The post Amanda Relies on Avail to be a Part-Time Landlord appeared first on Avail.
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Amanda is the quintessential Avail landlord. When she and her husband got married in 2011, they were stuck in the position of owning two condos, so they decided to rent one and become part-time landlords. Since then, the couple has acquired a small three-unit investment property. Amanda uses Avail to manage all four of their rental units. We had a chance to chat with Amanda to learn her secrets of being a successful part-time landlord.
What has surprised you the most about being a landlord?
Being a landlord is actually a lot easier than I imagined. We’ve all heard the landlord horror stories – tenants not paying rent, destroying the place, etc. I think what helps us is that we really respect our tenants – we respond quickly to issues, leave fresh flowers when they move in, that kind of thing. In turn, they pay on-time and only call us if there are major issues with the property. It’s a good relationship.
How much time do you spend on your rental properties?
I spend the most time when we have a vacancy (fortunately this doesn’t happen often). We try to set the rent price as low as we can to try to minimize the amount of time the unit is unoccupied. This gets us a lot of leads in a short period of time and I spend time carefully screening the applicants to ensure we get great tenants. Besides this, tenants pay online which saves me time having to go to the bank. The only other thing that requires time is handling maintenance issues, which fortunately happen pretty infrequently.
Did you ever consider hiring a broker or professional property manager to help?
We live relatively close to our rental properties, so paying a property manager 10% of the gross rent doesn’t make a lot of sense for us. If we lived across the country, then maybe we would consider it. As for a broker, it doesn’t make any sense for us to do this. We advertise our properties online and use the Avail application and lease. So the only thing that a broker would do is show the unit for us, but paying a one-month’s rent for showing the property is crazy.
You and your husband recently purchased a three-unit property. How’s that going?
Things with the 3-unit building are going well. We decided to buy the building after having the landlord experience from the condo. There are some differences – the condo building has a maintenance staff who we call for issues whereas the 3-unit building we have to find our own contractors. The biggest change going from one unit to four was realizing how important it is to keep things organized.
What’s the biggest landlording mistake you’ve made?
By far the biggest thing that stands out is something that we almost did. When we first decided to rent my old condo, we received interest from several tenants. There was one guy who presented himself very well and was ready to move in right away. My husband and I weren’t sure how to properly screen tenants at the time, so we told the guy it would take us a few days to figure it out. He asked if we would consider skipping the screening so that he could move in immediately. Fortunately for us, we said no, and we are so glad that we did. Once the reports came back, we realized that he was several months late on multiple credit cards. Who knows what would have happened, but we’re glad we didn’t find out.
What’s one tip or piece of advice that you want to share with other landlords?
The biggest suggestion I have for all new landlords is to spend a lot of time screening your prospective tenants (learn from our near mistake!). A lot of landlords make the mistake of renting to the first tenant they get, but it pays to be selective.
Editors note: Avail has blog posts with tips for screening tenants: Five Questions You Must Ask Your Potential New Tenants and Look Out for These Red Flags When You Show the Apartment to Your Prospective Tenant
How do you deal with repairs and maintenance requests?
First, we try to do as much preventative maintenance as possible. Second, when we bring in new tenants, we outline who is responsible for what and ask them to only bother us when there are major issues. After that, when tenants do have issues we make them log the issue in their Avail account where they can upload photos. When we get the notification, we call one of the handymen who we have developed a relationship with.
You have other landlord friends. What do you think they could do differently?
I get the sense that a lot of landlords don’t view their rental properties as what they are – small businesses. The rent you receive is your revenue, tenants are the customers and a vacancy directly cuts into your ability to be successful as a business owner. I think viewing the rentals as a business also sets a professional tone for how you deal with maintenance and your tenants. Unfortunately some people take things personally when things should be treated as a business.
How does technology play into your rental business?
My husband and I only recently became landlords, so it was natural for us to use technology to make things easier. I imagine that it would take a lot more time and more coordination to do things without tools like Avail. Even prior to using Avail, we were using some technology tools – like Google Docs, but Avail makes it a lot easier. One more thing to add – I think our tenants expect us to use technology. They’re all younger and expect that they will be able to pay their rent online. For us it was a no-brainer.
Finally, you’ve been using Avail for over a year now. How has the software helped you?
As I mentioned, we were using technology for our rentals before learning about Avail. What this platform has done is bring everything to one place – everything from the finding tenants to handling maintenance. It’s pretty awesome because, now with everything in one place, I feel much more organized and on top of things. It’s also saved time because I don’t have to switch back and forth between other things.
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The post Amanda Relies on Avail to be a Part-Time Landlord appeared first on Avail.
]]>The post Avail Landlord of the Month: Amanda appeared first on Avail.
]]>What has surprised you the most about being a landlord?
Being a landlord is actually a lot easier than I imagined. We’ve all heard the landlord horror stories – tenants not paying rent, destroying the place, etc. I think what helps us is that we really respect our tenants – we respond quickly to issues, leave fresh flowers when they move in, that kind of thing. In turn, they pay on-time and only call us if there are major issues with the property. It’s a good relationship.
How much time do you spend on your rental properties?
I spend the most time when we have a vacancy (fortunately this doesn’t happen often). We try to set the rent price as low as we can to try to minimize the amount of time the unit is unoccupied. This gets us a lot of leads in a short period of time and I spend time carefully screening the applicants to ensure we get great tenants. Besides this, tenants pay online which saves me time having to go to the bank. The only other thing that requires time is handling maintenance issues, which fortunately happen pretty infrequently.
Did you ever consider hiring a broker or professional property manager to help?
We live relatively close to our rental properties, so paying a property manager 10% of the gross rent doesn’t make a lot of sense for us. If we lived across the country, then maybe we would consider it. As for a broker, it doesn’t make any sense for us to do this. We advertise our properties online and use the Avail application and lease. So the only thing that a broker would do is show the unit for us, but paying a one-month’s rent for showing the property is crazy.
You and your husband recently purchased a three-unit property. How’s that going?
Things with the 3-unit building are going well. We decided to buy the building after having the landlord experience from the condo. There are some differences – the condo building has a maintenance staff who we call for issues whereas the 3-unit building we have to find our own contractors. The biggest change going from one unit to four was realizing how important it is to keep things organized.
What’s the biggest landlording mistake you’ve made?
By far the biggest thing that stands out is something that we almost did. When we first decided to rent my old condo, we received interest from several tenants. There was one guy who presented himself very well and was ready to move in right away. My husband and I weren’t sure how to properly screen tenants at the time, so we told the guy it would take us a few days to figure it out. He asked if we would consider skipping the screening so that he could move in immediately. Fortunately for us, we said no, and we are so glad that we did. Once the reports came back, we realized that he was several months late on multiple credit cards. Who knows what would have happened, but we’re glad we didn’t find out.
What’s one tip or piece of advice that you want to share with other landlords?
The biggest suggestion I have for all new landlords is to spend a lot of time screening your prospective tenants (learn from our near mistake!). A lot of landlords make the mistake of renting to the first tenant they get, but it pays to be selective.
Editors note: Avail has blog posts with tips for screening tenants: Five Questions You Must Ask Your Potential New Tenants and Look Out for These Red Flags When You Show the Apartment to Your Prospective Tenant
How do you deal with repairs and maintenance requests?
First, we try to do as much preventative maintenance as possible. Second, when we bring in new tenants, we outline who is responsible for what and ask them to only bother us when there are major issues. After that, when tenants do have issues we make them log the issue in their Avail account where they can upload photos. When we get the notification, we call one of the handymen who we have developed a relationship with.
You have other landlord friends. What do you think they could do differently?
I get the sense that a lot of landlords don’t view their rental properties as what they are – small businesses. The rent you receive is your revenue, tenants are the customers and a vacancy directly cuts into your ability to be successful as a business owner. I think viewing the rentals as a business also sets a professional tone for how you deal with maintenance and your tenants. Unfortunately some people take things personally when things should be treated as a business.
How does technology play into your rental business?
My husband and I only recently became landlords, so it was natural for us to use technology to make things easier. I imagine that it would take a lot more time and more coordination to do things without tools like Avail. Even prior to using Avail, we were using some technology tools – like Google Docs, but Avail makes it a lot easier. One more thing to add – I think our tenants expect us to use technology. They’re all younger and expect that they will be able to pay their rent online. For us it was a no-brainer.
Finally, you’ve been using Avail for over a year now. How has the software helped you?
As I mentioned, we were using technology for our rentals before learning about Avail. What this platform has done is bring everything to one place – everything from the finding tenants to handling maintenance. It’s pretty awesome because, now with everything in one place, I feel much more organized and on top of things. It’s also saved time because I don’t have to switch back and forth between other things.
The post Avail Landlord of the Month: Amanda appeared first on Avail.
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