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Landlord Handbook

01. ­ Table of Contents

1. Table of Contents
2. Office Contact Information
3. Owner Paperwork required

a. Contracts

b. Insurance

c. Owner Information Form

d. Other Documents

4. Marketing/Leasing

a. Leasing Fees

b. Preparing the home for lease

i. Professional Photography and Copywriting

ii. Staging a Furnished Home

iii. Standard Make-Ready versus General Contracting

iv. Standard of Care for Home (Exterior)

v. Standard of Care for Home (Interior)

c. Where we market

d. How we show the home

e. How often we give market updates

f. Resident Selection Process

g. The Lease

i. Executing the Lease

ii. Other Lease Clauses and Addendums (i.e. Pets)

iii. Early Termination of the Lease

iv. Termination of the Lease

v. Month to Month Lease

vi. Lease Term

vii. Lease Rate

5. Property Management

a. Management Fees

i. Charity

b. Communication

c. Late Rent, Eviction and Collections

i. Late Rent

ii. Eviction

iii. Collections

d. Maintenance/Work Orders

i. Policy and Procedures

ii. Repairs over $500

iii. Time Sensitive Repairs

iv. Recommendation against Home Warranties

v. Insurance Claims

vi. Release of Liability

vii. Multiple Bids and Major Repairs

viii. Recommended Paint colors, flooring options, appliances

ix. Wear and Tear

x. Utilities

xi. Repair Deductibles

e. Money Management

i. Direct Deposit Disbursement

ii. End of Year Accounting

iii. Escrow Accounts

iv. Invoices

v. Monthly Statements/Ledger

vi. Owner Contributions

vii. Portfolio Minimums/Reserves

f. Owner Portals

g. Property Visit Frequency

i. Pre Move In Walkthrough

ii. Post Move In Walkthrough

iii. Renewal Walkthrough

iv. Move Out Walkthrough

v. Total Walkthroughs

vi. Out of Cycle Walkthrough

vii. Landlord Walkthrough

h. Security Deposits

i. Resident Disputes

6. Renewals

a. Fees

b. Procedure

7. Summary of Fees


02. ­ Office Contact Information

 

CONTACT US IN TEXAS:
Mon – Fri: 9am – 5pm
1627 Williams Drive
Georgetown, TX 78628

Office: 512-942-0024
Fax: 815-346-5180
Maintenance Emergency: 512-­688-­6476
www.MarsHillTexas.com

 

Valerie Thedford, V.P. Operations/PM
Operations@MarsHillTexas.com

Kevin Restine, Property Manager
Kevin@MarsHillTexas.com

Wayne Nanney, Walkthrough Specialist
Cell: 512-591-8309
Walkthroughs@MarsHillTexas.com

 

WORK ORDERS:

Tehl Fuller
Office: 512­-688­-6476 (MHPM)
WorkOrder@MarsHillVirginia.com
Service@MarsHillTexas.com

 

CORPORATE:

Edward W. Lui, Broker/Owner
Cell: 571­-267-­8639
Edward@MarsHillRealty.com

 

CONTACT US IN VIRGINIA:
By Appointment Only
137 N. Washington Street, #201
Falls Church, VA 22046

Office: 571-409-MHVA (6482)
Fax: 815-346-5180
Maintenance Emergency: 571-­762-­4681
www.MarsHillVirginia.com

 

Justin Wilson, V.P. Operations/PM
Operations@MarsHillVirginia.com

 

SUPPORT

Lori De Jong, Support Team Leader
Greg Semon Jr., Support Team
BJ Muyano, Support Team
(Applications, Administration, Marketing
Propertyware, Portals)
Support@MarsHillRealty.com

 

ACCOUNTING

Alicia Coursey, Accounting Team Leader
Alicia@MarsHillRealty.com

Jen Meitzen, Accounting Team
Jen@MarsHillRealty.com

 


03. ­ Owner Paperwork Required

a. Contracts (See Landlord Handbook Forms)

i. TX ­- TAR Residential Leasing and Property Management Agreement
ii. VA – Exclusive Right to Lease Listing Agreement and Property Management Agreement
iii. MD/DC -­ GCAAR Property Management and Exclusive Rental Agreement

b. Insurance

Owners are required to carry and provide proof of a policy on the property with a minimum $100,000 liability coverage before rents can be paid. Policy must name “Mars Hill Realty Group, INC” as additional insured. Please EMAIL the declarations page to the office so we can upload that to your owner portal.

c. Owner Information Form

Pertinent information regarding the property for initial marketing of the property for rent. Please complete this and fill in as much information as possible, especially the bank information and social security!

d. Other Documents

i. W­9 – Form required by IRS to submit information regarding the property.
ii. Intermediary Relationship Notice -­ Form we’re required to provide in the instance where Mars Hill Realty Group represents both sides of a transaction (i.e., both owner and prospective resident).
iii. Addendum A – Landlord Handbook reviewed and signed.
iv. Rental License -­ This is required in Maryland and Washington D.C. and must be obtained by the owner. You can access the forms and helpful links on our website: http://marshillvirginia.com/services/property­management/owners/


04. ­ Marketing / Leasing Procedures

a. Leasing Fees

There are no start­-up fees, we get paid out of the rent collected to make accounting and cash flow more convenient for you.

i. Lease Only Service ­- 100% of one month’s rent; minimum $2000 (VA) ; $1500 (TX)
ii. Leasing and Management of the home -­ 100% of one month’s rent leasing fee (80% in TX). The leasing fee is defined as any time we put a new resident in the home.
iii. Renewal Fee ­- 30% of one month’s rent. The renewal fee is defined as any time we have to renew a contract with an existing renter.

b. Preparing the home for lease

i. Professional Photography and Copyrighting

When you hire Mars Hill Property Management, you can count on marketing that stands out from the rest. Any agent with a pulse can list your home on the Internet, but few can maximize your home’s marketing effectiveness like we can. Most marketing by traditional real estate companies feature amateur photography that is poorly exposed (bad lighting) and does not capture the true essence of a home. It may show how many rooms there are, but it doesn’t convey the feeling that those rooms can give you. The descriptions are equally bland, usually just a factual, bullet point list of features that would put an engineer to sleep.

The philosophy for our marketing is to invest in photography and copyrighting that is emotionally engaging for the renter. People buy and rent on emotion and not just facts.

We accomplish this by photography that makes your rooms look bright and evenly lit, without overexposing the windows. Our professional photographers use wide­ angle photography to accentuate the best aspects of the space, so you will actually see the entire bathroom and not just a picture of the shower!

Here are some comparison photos between two homes that are the same floorplan:

Mars Hill Realty Sample Photos

NOTE: If your home is not stage­-ready, we use amateur photos until your home is cleaned, vacant and ready for professional photos.

We also use copywriting that takes the traditional list of features and translates those to lifestyle benefits. It’s the difference between listing out the features of a yard, which most real estate companies do:

Private, fenced backyard with a beautiful lawn and wood deck

versus the lifestyle benefits of the yard:

Relax in the privacy of your own backyard or engage in a friendly game of football while

the fresh smell of hamburger patties are sizzling on the grill.

Traditional Marketing:

“Great home with nice extras, including plantation shutters and hard wood flooring, in Sun City­ AGE REQUIREMENT in this community, pets okay with approval, under 35 lbs, great amenities and lawn care included in rent, ready for Immediate Move In!”

“Very large master with huge Master Closet and Master Bath with Walk in Shower. Pet Fence and “Doggie door” available for trained Pet. Wood Laminate floors throughout.”

Combining this marketing copy with the traditional photography above, the two floor plans were able to rent for an average of $1425/mo in 11 days.

Here is the description that our company used for the same floor plan in that neighborhood:

Mars Hill Marketing:

“Wonderful open and airy home in Sun City has much to offer. This three bedroom two bath home backs up to a luscious greenbelt. The screen in back porch is a great place to relax and enjoy a cup of Joe. If relaxing isn’t your thing, don’t worry, just hop in your golf cart and drive to numerous golf courses, clubhouses, biking and jogging trails or swimming pool.”

This particular marketing copy with the Mars Hill photography above resulted in a rental price of $1600/mo with just 1 day on the market. Effective photography and marketing copy can save you money!

ii. Staging a Furnished Home

If your home is occupied by your family while we are marketing it, we highly recommend that you stage it. If you stage your home, you are more likely to get a viewing, increase the perceived value, spend less time on the market, and help the future resident visualize living there, while overlooking the flaws.

Here are some resources to help you stage your home:

http://www.houzz.com/ideabooks/2661221/list/sell­your­home­fast­21­staging­tips
http://www.hgtv.com/design/decorating/design­101/30­cant­miss­home­staging­tips
http://www.hgtv.com/shows/designed­to­sell/15­secrets­of­home­staging­pictures
http://parade.com/275765/leahingram/11­frugal­ideas­for­staging­a­home­for­sale
● Also see “HOME STAGING TIPS” Document in Landlord Handbook Forms

Consider these findings from the National Association of Realtors:

● Among REALTORS® who typically represent the buyer, 49 percent report most
buyers are affected by home staging and 47 percent report some buyers are affected by home staging.

● For buyers it is easier to visualize the property as a future home (81 percent), buyers are more willing to walk through a home they viewed online (46 percent), will positively impact the value of the home if it is decorated to the buyer tastes (45 percent), and buyers are more willing to overlook other property faults (28 percent).

● Among sellers’ agents 34 percent stage all homes, 13 percent stage difficult homes to sell, and four percent stage only high price bracket homes. Forty-­four percent suggest the seller de-­clutter and fix property faults only and do not stage the home.

● The median dollar value to stage a home is $675 for each home.

● The most important rooms to be staged for buyers matches identically to the rooms that are most common to be staged among sellers—in order: living room, kitchen, master bedroom, dining room, bathroom, children’s bedroom, and guest bedroom.

● Thirty-two percent of buyers’ agents believe staged homes increases the dollar value buyers are willing to offer by one percent to five percent. Nineteen percent say there is no impact on the dollar value, and 16 percent believe it increases the dollar value buyers are willing to offer by six percent to 10 percent.

● Thirty-­seven percent of sellers’ agents believe staged homes increases the dollar value buyers are willing to offer by one percent to five percent. Twenty­-two percent believe it increases the dollar value buyers are willing to offer by six percent to 10 percent, 10 percent say home staging has no impact on dollar value, and eight percent say home believe staged homes increases the dollar value buyers are willing to offer by 11 percent to 15 percent

● Staged homes spent 72% less time on the market.

 

iii. Standard Makeready versus General Contracting

We will work with you to prepare the home for the market by making recommendations during our initial walk-through. If there are items that need to be completed, we can refer you an appropriate contractor suitable for the job. Initial make­ready projects should be handled directly by the owner if they are still living in the home. On subsequent make­ready projects, or if the owner is not present, we can help. However, we are a property management company and not a general contractor. Our goal is to help our owners prepare their home for the market when it comes to cleaning and minor repairs. If there are major renovations needed, these are outside the scope of our services.

We define major renovations as projects that involve managing three or more vendors or costing in excess of three months of rent for the property. In ideal circumstances, the owner who is leaving their home and converting it into a rental will be available to manage major renovations. If the owner is not available, we can help you select a general contractor to manage the project on your behalf. If we are placed in the position of managing a major renovation, we will include a project management fee of 10% of the project cost.

Our goal is to help our owners prepare their home for the market when it comes to cleaning and minor repairs. Any make ready costs above the repair limit will be presented to the owner for approval. There are three circumstances in which we would make repairs without owner approval:

1. Any make ready costs that are covered by the tenant’s security deposit
2. Any make ready costs below the owner’s repair limit set forth in their contract (usually $500)
3. Any required health and safety items per local property codes.

iv. Standard of Care for Home (Exterior)

Items included in the exterior make­ready process may include but are not limited to yard maintenance (mow, trim bushes and trees), fence repairs, irrigation repairs, painting if wear and tear is significant, gutter repair, etc. See Landlord Handbook Forms.

 

v. Standard of Care for home (Interior)

Items included in the interior make­ready process may include but are not limited to replacing light bulbs, 9V batteries in smoke detectors, general cleaning, carpet cleaning, changing HVAC filters, touch up painting, etc. See Landlord Handbook Forms.

 

c. Where we market
In addition to real estate signage, we leverage the Internet to market our listings. Here are some of the websites that your home will be listed on:
Local real estate database (Multiple Listing Service)

Company website:
(VA/MD/DC) http://www.MarsHillVirginia.com or
(TX) http://www.MarsHillTexas.com

Company Facebook page:
(VA/MD/DC) https://www.facebook.com/marshillvirginia or
(TX) https://www.facebook.com/marshillrealty

Company Pinterest page:
(VA/MD/DC) https://www.pinterest.com/marshillva
(TX) https://www.pinterest.com/marshilltexas

Other real estate websites:
Realtor, Hotpads, AOL Real Estate, Backpage, Enormo, Facebook, FrontDoor, Gee, Local, Locos, Military, Oodles, Trovit, Walmart, Yahoo, Yakaz, Zillow, Campus Avenue, Rent Jungle, RentBits, Rentenna, Walkscore, Trulia, Apartment List.

We have been very successful in renting out hundreds of homes using these online resources. If you want us to create a custom listing or submission on a website not listed here, we charge $100 per listing in addition to the cost that we incur from that website.

 

d. How we show the home

As proof that our marketing works, we have been consistently receiving 500+ inquires every month for our listings. The volume of our rental prospects is so overwhelming that we have created a screening system to “weed out” the prospects who may not have a good rental history, unrealistic move-­in timelines, or just aren’t serious. In addition to in­-house real estate agents, we may also partner with trusted associates in the real estate community to help show our homes. Lastly, if the home is vacant, we may conduct remote showings. A remote showing occurs only after we have screened the tenant, collected a copy of their identification card and confirmed that the home is vacant. If the prospect is qualified, we would give them access to the home so they can see it on their own schedule and they would just lock up on their own. Whether the listing is shown in-­house, via a real estate partner, or conducted via a self-showing, we will make sure your house gets shown to qualified prospects.

 

If the home is occupied, we will typically ask the showing agent to give the resident at least 24 hours notice and access the home via the lockbox. It’s generally advised that the resident is not at the home and proper coordination has been conducted so that any pets are removed or kenneled. We also ask the resident to put away or lock up their valuables and medications. Oftentimes a showing agent cannot give such notice and may even show up unannounced! If that occurs, the current resident can simply turn them away and ask them to come back. However, if they are flexible, it’s best to show the home and make sure they receive a business card so we have a record of the visit.

 

e. How often we give market updates

Once your home is active on the market, we will give you updates every 2 ­ 4 weeks of any showing activity, agent feedback or rental rate change recommendations. We will continue this process until your home is leased.

 

f. Resident Selection Process

We have an excellent record of helping our owners choose a qualified renter for their home. As we take resident screening very seriously, we have a very stringent screening process that will eliminate unqualified prospects. We will complete the following:

● Credit Review
● Criminal Review
● Eviction Review
● Verify bankruptcy information (if applicable)
● Proof of Income
● Debt/Income Review
● Rental History Review

Once completed, we will recommend either approving or denying the applicant. If approved, we will begin the lease signing process. If denied, we will provide the applicant with a denial letter as well as reason for denial. In order to keep the momentum going with the prospect, we will often decide to approve the resident and give you a 12-24 hour window to comment or ask questions. See Resident Handbook Chapter 3c for more details on the Tenant Selection Criteria that we publish.

 

g. The Lease

i. Executing the Lease

We will be acting as the agent on your behalf to negotiate, prepare, modify, cancel and sign all aspects of the lease.  Until all parties sign a lease, and have received an executed copy, the agreement is not legally binding.  In Texas, we use the standard Texas Association of Realtor (TAR) Residential Lease Agreement.  We use the standard Northern Virginia Association VRTLA Lease in Virginia and GCAAR Lease in Maryland and Washington, DC which is provided by our Local Association/Board (with a few company specific changes). These leases are kept up-to-date by the Local Association and State Association legal counsel, with new requirements or protections offered under the law. We do not change these leases and if you would like to review them before we begin marketing your property, please let us know and we will be happy to provide you a copy.

ii. Other Lease Clauses and Addendums ­

We include additional lease clauses specific to our managed properties. These terms/clauses/addenda are included to assist us in managing your property to our company standard. The inclusion/addition of these help us maintain the excellent track record of low late payments, evictions, maintenance costs and several other key performance indicators. Once the lease is executed, we collect all the funds included in the lease due at the time of execution.

● Pet Addendum ­ Unless you have indicated otherwise, we will accept pets in your property on a case-by-­case basis. We will require a $500 nonrefundable pet fee for the first pet and $100 refundable pet deposit for additional pets. The pet fee is income for the owner.

● Emotional Support Animals (ESAs) ­ Unfortunately, even if you do not allow pets, the law does not allow us to deny applicants who have ESAs. Also, we are not able to charge any additional fees/deposits for ESAs. However, we will require them to provide us information so that we can verify the legitimacy of their ESAs through a mental health provider.

iii. Early Termination of the Lease ­

Occasionally a resident will want to terminate the lease early. Our company policy is to inform them that early terminations are not allowed and when they agree to our new Resident Handbook they are agreeing to pay a early lease termination penalty of three months’ rent. This fee is to help recover your costs of re­-leasing the property, potential vacancies, and make-ready expenses that are not attributed to the security deposit.

 

If the residents provide us notice to terminate the lease early, we will notify you and make the necessary arrangements to market the property for rent to secure a new lease as close as possible to the resident’s new termination date. We cannot collect “double rent” from both an outgoing resident and an incoming resident.

iv. Termination of the Lease

If either you or the residents do not want to renew the lease, either party must give written notice of this intent within the time frame noted in the lease. It is normally 60 days prior to the lease termination but refer to your lease for the required days notice. Please check your specific lease for the term agreement and conversion to month to month.

v. Month­-to­-Month Leases

We prefer not to allow month-to-month leases, unless your current lease terminates during the winter months and you want to wait for a better time of year to re-rent it. It is usually better for the landlord to have a specific lease term for planning purposes. We don’t recommend month-to-month leases because of the risk of vacancy at any time. If your current lease terminates during the late winter months, it definitely makes sense to offer a short term lease for a few months in order to have the property become available in the spring/summer season. We can specify that the month-to-month term will not extend beyond a certain date, and upon that date we can sign a 12-month renewal with the tenant or market the property. All of this is market dependent.

vi. Lease Term

The standard term is 12­ to 24 months. On month to month and short term leases, we usually recommend a 10% premium on rents.

vii. Lease Rate

We will provide you with our market analysis based off comparables that have rented in the past 6­ to 12 months in your neighborhood and/or zip code to determine the lease rate.


05. ­ Property Management

a. Management Fees ­

The management fee is only charged on rents that we collect. Therefore, you will not be paying a management fee when we are marketing your home if it is vacant.

1 ­- 5 properties ­ 10% monthly management fee
6 -­ 10 properties ­ 9% monthly management fee
11+ properties ­ 8% monthly management fee

i. Charity ­

Helping others and building relationships are at the core of what we do. We have had clients offer their homes at significant discounts from the market rental rate to help their community. This could benefit families that are going through a financial/health crisis, or even victims of natural disasters (i.e. flooding or fires) looking for temporary shelter.

When you discount your rent, we match that discount on our management fees. For example, if your home’s market value is $2000/mo and you want to offer it for $1000/mo (50% of market value), we will discount our management fee by 50%. If you offer your home for free, we will manage your home for free too!

 

b. Communication

We handle all communications with your renters. That is what you pay us for! If a renter knows how to contact you, they will! Please help us to reinforce this policy by referring any “accidental” direct contact by the renters to us so that we can stay in the loop. All communications should be handled through your owner portal. Not only will you get a quicker response, but we then have a written trail of communications. Once you log a question or comment on your owner portal, it will be dispatched to the appropriate person to respond back to you. Our goal is to respond to voice mails by the next business day and emails within two business days. All communications that come through the portal will have priority and will be responded to within one business day.

Please contact your property manager for any dispute resolution regarding staff. If you are not able to resolve your questions with the property manager, you may always request a phone call by the broker/owner. We do our best to work with you, but sometimes there will be situations where you may not agree with a decision we have made. Here are the following remedies available for the Landlord if they disagree with a decision that Mars Hill has made.

1. Continue to trust in the good faith and judgement of Mars Hill even if it is contrary to your own.
2. Negotiate new terms for the management contract and lease that are mutually agreeable to all parties. These terms will need to be publicized as such during marketing as exceptions to our Landlord and Resident handbooks.
3. Give notice of termination to Mars Hill.

If you are a Texas owner, you can also forward your questions or concerns to the following persons:

● Contract Questions, New Owners, Client Relations ­- Operations@MarsHillTexas.com
● Maintenance, Make Readies, Bids ­- Service@MarsHillTexas.com
● Accounting, Statements, Owner Draws ­- Alicia@MarsHillRealty.com
● Owner Portal, Office Administration ­- Websites@MarsHillRealty.com
● Renewal Questions ­- Operations@MarsHillTexas.com
● Marketing Questions ­- Marketing@Marshillrealty.com

If you are a VA/MD/DC owner, you can forward your questions or concerns to the following persons:

● Contract Questions, New Owners, Client Relations – Operations@MarsHillVirginia.com
● Maintenance, Make Readies, Bids, Inspections – Workorder@MarsHillVirginia.com
● Accounting, Statements, Owner Draw – Alicia@MarsHillRealty.com
● Owner Portal, Office Administration – Websites@MarsHillRealty.com
● Renewal Questions – Operations@MarsHillVirginia.com
● Marketing Questions – Marketing@MarsHillRealty.com

 

c. Late Rent, Eviction and Collections

i. Late Rent

Rent is due on the first of every calendar month and is considered late on the second. The late fee is assessed on the fourth day of the month. Any late fees collected are considered company administration fees and kept by the company. Returned check fees and trip charge fees are also administration fees. All rents received will be first applied to company administration fees on the tenant’s ledger prior to the rent.

ii. Eviction

Evictions cost everybody time and money. However, if you choose the right management company, these are a rare occurrence. We will do everything we can to avoid an eviction. Our 1% eviction rate is an industry low because of our proprietary tenant screening criteria and application systems. As a last resort, should it become necessary to file an eviction, we will refer the eviction out to an eviction attorney who is an expert at these types of proceedings. The owner will be responsible for attorney fees and any court costs such as filing fees incurred for the purposes of removing a renter from the home. These fees will be charged back to the resident in default.

iii. Collections

Upon move out of the home, Mars Hill will prepare the Itemization of Deposit within thirty days of the move out date. If there is a balance owed to the Owner by the residents, Mars Hill will try to collect that balance within thirty days of the move out. If after attempting to collect the debt, and the balance remains unpaid, the owner can then forward the file over to a debt collection service.

 

d. Maintenance/Work Orders

i. Policy and Procedures

The purpose of the maintenance division is to preserve the value and condition of your property by avoiding deferred maintenance. We are committed to taking care of your property and provide excellent service to the residents so that they will continue to renew the lease and become long-term residents. Residents are best kept happy when they know that work orders are being responded to in a timely manner.

In order to accomplish this, the management company must be afforded the freedom to make decisions on an owner’s behalf. That is why there is a $500 repair limit and portfolio minimum. We will make decisions on work orders that are under the $500 repair cap and the owner must keep a $500 credit on their ledger at all times.

We do our best to hire the right contractor for the job, but at times the contractor can cause damage or liability beyond our control.  The landlord agrees to release Mars Hill Realty Group from all liability in these situations.

ii. Repairs Over $500

If it is NOT time-sensitive – we will obtain an approval from the owner before scheduling.

If the repair is time-sensitive – we will contact the owner with our recommendations and move forward on a course of action if we do not hear from the owner within 24 hours. It is the owner’s responsibility to maintain updated contact information through their portal. Reasonable care and performance will be expected from owners for the sake of preserving not only the safety of the residents, but also the property’s value and condition. We reserve the right to determine what is “time sensitive” or an “emergency”.

If the repair is a time-sensitive emergency – Some time­sensitive repairs are also EMERGENCIES. We reserve the right to make decisions in EMERGENCY situations without the owner’s approval, if there is imminent danger to the property or health or safety of the resident.

If a Landlord expresses their disapproval of a repair decision and does not want to permit Mars Hill to do a repair that we feel is necessary, that is contrary to this contract and a violation of the property code.

Regardless of the Landlord’s opinion to the contrary, Mars Hill has an obligation to fulfill the terms of the property management contract as well as the lease with the resident. Mars Hill, not the Landlord, determines what is necessary for the protection of the property and the health and safety of the resident using our professional judgement.

iii. Time Sensitive Repairs

Security:
● Actual fire on property
● Break in/Burglary
● Broken door/window that cannot be secured and located on first floor
● Alarm that does not turn off and continuously sounding
● In-home sprinklers that are running
● Fence broken and there is a dangerous pet situation in yard or neighbor’s yard.

Structural:
● Storm damage to roof with potential water penetration

Plumbing:
● No usable bathroom in the property
● Burst water supply lines
● Water heater failure/no water in home
● Sewer backup or leaking into home

Electrical:
● High voltage electric hazard

HVAC:
● No heat in the property and the outside temperature is below or forecasted to be below 32 degrees
● No air conditioning in the property and the outside temperature is above or forecasted to be above 90 degrees

Every work order that is submitted through the portal will automatically notify the owner via email so that there are no surprises at the end of the month when you see less rent money than usual. This also gives you the opportunity to proactively respond to work orders and approve them if you know they will be above $500. By cutting down the decision-making time, we are able to fix problems quickly before they develop into something worse. We also reduce the coordination hassle for the residents and improve relations with them as well.

vi. Recommendations against Home Warranties

Home warranties greatly limit our ability to respond quickly to needed repairs. In our experience, warranty companies use very poorly rated vendors to get the job done. If you have a policy for your home, please consider canceling or not renewing the policy for the duration of the management agreement. Please see paragraph 5d regarding time-sensitive repairs that may require action outside of your home warranty regardless of coverage.

v. Insurance Claims

When there are large repairs that require coordination with your insurance company, you are responsible for filing the claim and negotiating/coordinating with the insurance company on specific payouts and scope of work. We will coordinate with the insurance company to provide access to the property and provide you photos of before and after work. We can also recommend vendors to get the work completed. As with all emergency work orders, we reserve the right to get started on repairs to limit property damage even before the insurance company begins their coordination. All owners agree to release Mars Hill Realty Group from all liability resulting from scheduling delays with the insurance company.

vi. Release of Liability

All owners agree to release Mars Hill Realty Group from all liability resulting from scheduling delays with the home warranty vendor, insurance companies or resulting from delays caused by owners who have not approved work within 24 hours of notification.

vii. Multiple Bids and Major Repairs

Oftentimes we use vendors that have already been screened for fair pricing and good business practices. However, on occasion, there may be repairs that warrant two to three bids. If the owner wants a fourth bid, the owner will be responsible for providing the specific vendor.

We define “major repairs” the same way we define “major renovations” Refer to Chapter 4.b.iii. – Standard Make-Ready Versus General Contracting. Any repairs involving three or more vendors or costing in excess of three months of rent for the property is a major repair. If we are placed in the position of managing a major repair, we reserve the right to include a project management fee of 10% on top of of the total project cost.

viii. Recommended Paint colors, flooring options and appliances

If you are considering upgrades to your home, we can help you by recommending paint colors, flooring options, and appliance options that are durable and sustainable for a rental home.

ix. Wear and Tear

A fact of home ownership is that your home will degrade and deteriorate over time. This includes the overall structure of the home as well as appliances, plumbing, wiring, etc. We will provide our best efforts to preserve the value and condition of your property. The owner should expect normal wear and tear of flooring and walls and be prepared to replace and repaint accordingly every three to five years.

x. Utilities

Any utilities that are covered by the HOA payment will be the responsibility of the Landlord. Utilities should always be kept on, when the resident is not responsible for it during their lease, the bill will be paid by the Owner or reimbursed to Mars Hill Realty Group.

xi. Repair Deductibles

The reason we may charge a repair deductible to a tenant is to prevent the abuse of the work order system. It is meant to eliminate frivolous work order requests by giving the tenant some level of financial responsibility. It is sometimes impossible to determine if breakage is due to the tenant or normal wear and tear so we charge a very minor repair deductible that would be passed on to the Landlord when collected. Repair deductibles are not charged for every work order, there are exceptions and they are evaluated on a case by case basis. The decision to charge the tenant a repair deductible rests solely with the management company.

 

e. Money Management

i. Direct Deposit Disbursement

Directly dispersed into an owner’s bank account by the 10th of each month (provided rents have been collected)

ii. End of Year Accounting

Our CPA mails out year­-end 1099 statements according to IRS regulations. Annual statements can also be viewed via your owner portal under the “documents” tab for the preceding year on Jan 15th each year.

iii. Escrow Accounts

Occasionally, tenants pay one or more months of rent in advance. When this occurs, all advance rent payments are escrowed and distributed to the landlord as each month’s rent comes due.

iv. Invoices

Invoices can be viewed via your owner portal under the “bills” tab.

v. Monthly Statements/Ledger

Monthly statements are emails following direct deposit disbursement which can also be viewed via your owner portal under the “statements” tab. If you have questions about your ledger, email Alicia@marshillrealty.com. You should receive a response within 24 hours.

vi. Owner Contributions

If expenses exceed $1500, your property manager will ask you to make an owner contribution through your owner portal. Once you log into your portal, click on the “statements” tab then scroll to the bottom of the screen and click on the “edit payment account” button. On the next screen, you will need to enter your bank name, account type, routing number, account number, SS number, driver’s license number, and driver’s license state, as well as your billing address info. Once all that is entered, click save. Now, go back to the “statements” tab, and on the right side, you will see “make contribution online”. Click on this link. The next screen will have a place for you to enter the amount you would like to contribute, and then click “save”.

vii. Portfolio Minimums/Reserves

A minimum of $500 will be held in a contingency reserve account.

 

f. Owner Portals

Once you sign up with Mars Hill, you will receive an email inviting you to create your owner portal and password. Please note, for security reasons, there is a 48-­hour window for the invitation, so if you don’t have an opportunity to set up your portal before it expires, please let us know and we will be happy to reset it for you.

Once you have your portal set up, you will be able to keep track of your monthly statements, bills, maintenance requests and other documents. If you need to make a payment to Mars Hill, you will be able to make an owner contribution on your portal as well.

 

g. Property Visit Frequency

There are many different situations when an inspection of the property may be performed.

i. Pre Move In Walkthrough

This standard walkthrough occurs two to three days prior to move­in. The purpose of this walkthrough is to make sure the resident has all their monies paid, paperwork complete, utilities on and to review the basic functions of the home as well as to make sure it is ready for occupancy.

ii. Post Move in Walkthrough

This standard walkthrough occurs within one to two weeks after move­in. A Move In Report or the Inventory & Condition Form is completed along with corresponding photos. This form notes any deficiencies or damage so the resident has a record of the pre­existing condition prior to move­in. It is used as a point of reference when the final inspection is conducted at the end of the lease. Also, the report and links to the photos will be published to your owner portal.

iii. Renewal Walkthrough

Prior to renewing any lease, we will perform a renewal walkthrough of the interior and exterior of the home. See Chapter 6 for more details.

iv. Move Out Walkthrough

This standard walkthrough occurs within 48 hours of a resident vacating the home. We coordinate with the residents to perform a Move Out walkthrough once they have vacated the property and completed the requirements of the lease.

v. Total Walkthroughs

Over the course of the lease, we are in the home at least three to four times via our standard walkthroughs, not including any additional exposure to the property as a result of work orders. We have found that this is a sufficient balance to take care of your home and still respect the privacy of the tenant. Unless we receive a tip from a neighbor, or HOA letter, or anything that warrants an additional walkthrough, we do not conduct any other visits to the property. If a lease violation is noted, we may do a follow­up inspection to make sure the tenants have complied.

vi. Out of Cycle Walkthrough

If you require an additional walkthrough, we can do so at the rate of $75/inspection.

vii. Landlord Walkthroughs

When you are in the area, it is natural to want to see your property. Out of courtesy for the resident, please give us advanced notice if you are planning to be in the area and would like to stop by your property. We will notify the tenant and make this coordination. The lease requires us to give the tenants reasonable notice. Try to give us at least several days’ notice to prepare the tenant and to schedule a convenient time for all of us.

 

h. Security Deposits

We require one month’s security deposit from a resident and hold it in a non­-operating escrow account. We audit our accounts quarterly to ensure our deposits are balanced.

i. Resident Disputes

One of our primary duties as your representative is to enforce the lease. We will make every effort to do so before, during and after the term of residency. If ever a dispute arises with the resident, Mars Hill will make every effort to resolve that dispute according to the terms of the lease and the Property Management Agreement. Ultimately, contracts are between the Landlord and Resident and if any legal action is necessary, the Landlord is responsible for all legal fees.


06. ­ Renewals

Renewing the Lease ­- If the resident does not provide us notice to end the lease, we will coordinate a lease renewal. We always attempt to increase the rent if the market will support it.

a. Fees

There will be a fee of 30% of the new monthly rental amount to renew an existing lease. This fee will be charged upon executing the lease renewal.

b. Procedure

i. Initial Contact with Resident

60-­90 days prior to a lease expiring, we will contact the resident to determine if they want to extend the lease.

ii. Property Walk­-through

If a resident wants to renew the lease or are indecisive, we will conduct a property walk­-through to determine the condition of the home. We want to make sure the resident is taking good care of the home prior to renewing their lease.

iii. Market Analysis

We will conduct an updated analysis to make sure your home is priced competitively in the current market.

iv. Owner Recommendation

We will consider the rental history, property condition, and market analysis to make a recommendation to you.

v. Lease Extension

Once we agree on a course of action, we will negotiate a new lease extension with the resident.


07. ­ Summary of Fees
  • Additional Services – Billed at $200/hour upon Landlord approval.
  • Custom marketing link$100 per link in addition to the cost from that website
  • Leasing Fee – 100% of one month’s rent (80% in Texas)
  • Maintenance Costs Financing – If a repair exceeds the portfolio minimum, Mars Hill might agree to pay for the repair and will be reimbursed by the owner from the next month’s rent.  If the repair costs exceeds the amount of rent that comes in, Mars Hill will charge 10% interest on any open balance until paid in full.
  • Major Repairs/Renovations – Defined as projects that require three or more vendors or repair costs that exceed three months’ rent.  10% of the total project cost.
  • Management Fee – 10% of rent collected
  • Out of Cycle Property Inspection – $75/inspection
  • Renewal Fee – 30% of one month’s rent

 

 

Acknowledgement of the Landlord’s Handbook

The Landlord Handbook Contains the following Information:

• Table of Contents

• Office Contact Information

• Owner Paperwork Required

• Marketing / Leasing Procedures

• Property Management

• Renewals

• Summary of Fees

 

I have read and agree to all terms and future updates to Addendum A - Landlord Handbook.

 

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