Many investment property owners do not put much thought into whether they’ll be able to pay the mortgage on their investment property each month.
After all, that’s why you have tenants, right?
However, it’s not just tenants failing to pay their rent each month that can cause your rental property business to go under. In fact, not being able to cover the mortgage each month has the potential to do far worse damage than a few missed payments by your tenants.
At least with tenants that don’t pay their rent, there is a remedy for collecting those payments.
You may think it’s only the tenant who has a hard time paying the rent, but as a real estate investor or landlord, there may be times when it’s hard to pay the mortgage on your end as well. Here are some things you can do to avoid facing difficulty in paying your mortgage each month.
3 ways to proactively Avoid Mortgage Trouble with Your Baltimore Home
1. Screen All Tenants
Do your best to find quality tenants. While you want to keep your properties full, finding good quality tenants is key. By “good” it means they pay their rent on time, keep the property maintained and don’t abuse the lease. By using background and credit checks, you can find the best tenants available and thereby do what’s possible to keep your rental fees coming in regularly, which will help you pay the mortgage when it comes due.
Look for longterm tenants. Don’t assume that quality tenants will necessarily be longterm ones. Some good renters may know they can’t stay over a few months at most. They may be students or working a temporary job. They may just be living in an area waiting to move or retire somewhere else. Whatever the situation, opt for longterm renters when the choice is available. Doing so will make filling a vacancy at least a more infrequent possibility.
2. Limit Vacancies
Keep your properties full. While it may sound overly simplified, this is the most obvious method for ensuring you’ve got rent money coming in each month to cover your property mortgage payments. Don’t allow yourself to get slack on advertising for new tenants. And don’t put off screening applicants or filling your properties because you get busy or overworked. Recognize filling your vacancies as a major aspect of your REI business success and deal with it quickly and efficiently every time.
3. Maintain the Property
Keep the property well maintained. If you want good tenants, longterm tenants and tenants who pay their rent on time, do your part to keep them. Deal with maintenance issues quickly. Make repairs as necessary. Upgrade appliances or at least ensure the ones you provide are in good working order. Respond to your tenants’ calls quickly, or if you can’t be sure they know you’ll be unavailable for awhile.
Being a good landlord will go a long in way in developing lasting relationships with your tenants, which will in turn, help you keep them in your property longer. Often a tenant and landlord relationship can turn an average tenant into a great one simply because they want to keep that relationship intact.
In the event you want to discuss your options, contact Charm City Property Solutions today and see how we can help.