- What Are Some Costly Landlord Mistakes You Should Avoid? Here’s A Quick Video On How To Avoid These Landlording Mistakes...
Hi, this is Frank Chen with REIClub.com, the only site you need as a real estate investor. Today I’ve got a quick video on protecting yourself as a landlord.
Landlord Mistake 1: Failing to Properly Screen Tenants
Landlord Mistake 2: Using a Generic Rental Agreement
Landlord Mistake 3: Ignoring your Rental Properties
Landlord Mistake 4: Failing to Serve Tenant Violations
Landlord Mistake 5: Over-Leveraging your Rental Properties
Many investors get involved with rental properties for their leverage. Taking 1 property, leveraging the financing and turning it into 2, then 4, and so on and so forth.
However, the problem is, if you borrow too much against your investments, or over-leverage, you will then leverage yourself out of any monthly cash flow. This means you will be in the red as soon as you have a vacancy, or unexpected property maintenance.
Quick Tip: Predict your monthly expenses (mortgage, taxes, and insurance) at no more than 50% of your month rent, some cities you’re looking at 75% of rent, but in the end you should still be cash flowing.
Rental properties offer great investment returns when leveraged correctly. I understand that being a landlord isn’t the easiest, but its one of the best ways to build long term wealth.
Hopefully this video has made you aware of common Landlording pitfalls, and will save you from future hassles when dealing with rental properties.
Again, this is Frank Chen with REIClub.com. Please take the time to leave your comments for this video below and please subscribe to our YouTube channel so you’ll be automatically notified when we upload more quick video tips for you. Take care and good investing.