Teaching Landlords to Find Their Quality Tenant!

My original introduction for the book, "How to Find That Quality Tenant"

When I first began to write this book, for some reason I had the brilliant idea to include excerpts from movies and TV that somehow had tie-ins to landlording. I was thinking of calling the book "The Couch Potato's Guide to Landlording" or "What I Learned About Landlording by Watching TV". You may notice a couple of these excerpts are still placed upon these pages.

Anyway, the following introduction was the first intro I was going to use in the book way back when it was loaded with this TV stuff. I decided to put it up on the website for all to see. Read it and you learn a little about me. I hope you enjoy it.

"Skip!" (My mom called me Skip, never Don.) "Shut off that TV, get in here and eat NOW!"

"But Mom, Marcia Brady is just about to get hit in the nose with the football. I can't miss that!"

"You've already seen that episode. Besides, you just watched 'Speed Racer' and 'The Flintstones'. Supper is getting cold. Get in here and eat. And by the way, when do you plan on doing your homework?"

"Tonight, while I watch 'Butch Cassidy and the Sundance Kid.'"

The above scene was typical of the supper time ritual around my house. My mom's role was to make a complete home cooked meal and then proceed to call me to the dinner table a dozen times. My role was to give off the simulation of obedience, all the while stalling until her voice rose two octaves. We both played our parts often and with vigor.

Now all this transpired not because I was a bad kid, or even because I disliked my mom's cooking. The reason for my constant procrastination in getting to the dinner table was my addiction to the television set. Like most kids brought up in the 60's and early 70's, if I wasn't outside playing tag, baseball or riding my bike, I was probably parked on the couch in front of the TV watching a movie, sitcom or cartoon.

And if it was raining, the problem was tenfold. I mean, think about it. Besides books and board games, the television was a main source of indoor entertainment because us 60's kids didn't have the variety of rainy day activities like today's kids have. There were no computers or computer generated games. The words Playstation and X-box meant absolutely nothing. Even the very first home video game, "Pong" was just a concept on someone's notepad at that time. And somehow, although we didn't have these interactive type games (which at least offer some training for hand to eye coordination), we still managed to sit entranced in front of the TV for hours. Of course, as we grew up, we continued with this "mindless" habit, logging more TV time with each passing year.

Now this may not be as bad as it sounds, because what kids of that era didn't realize at the time was that most movies and TV shows, no matter how far fetched they seemed, had real life lessons and morals sewn into the storylines. (Not so true of TV today!) So even though most things we watched were first designed to entertain, many of us 60's kids did picked up some useful information from all that boob tube worshipping.

This thought really became apparent when I started writing this book. You see, as I jotted notes down on paper, turned notes into paragraphs and finally, paragraphs into chapters, I kept uncovering a wealth of past TV and movie scenarios that somehow applied to my way of thinking as a landlord. Because of this discovery, I realized that as I wrote this book, I should share some of those scenarios with you. In doing so, I hope as you read about whatever movie or TV scene I'm recalling, not only will you see the value of the story, but hopefully you'll remember some fond memories from days past.

But before we go any further, I need to pull the reins in a bit since I may be getting slightly ahead of myself by talking about the TV and movie scenes I included in the book. When it gets right down to it, this book is first and foremost about finding quality tenants for rental properties: your rental property, which means I should give you a little personal history about myself in regard to my love of real estate investing, why I'm qualified to write this book and how it came to be. This story is simple, really. Basically, houses, buildings, a love for architecture and any kind of construction has always been in my blood, or maybe even imprinted in my DNA. The fact is, in some form or other, real estate has always been a part of who I am. It is part of me now as a 40 something real estate investor. It was with me in high school when I took drafting, and it was with me as a preteen every time I played my all time favorite childhood game, Monopoly.

In fact, one of my very first childhood memories is sitting on my Grandma's living room floor building a house with big Styrofoam blocks. If you're around 40 or 50 years old, you may remember the ones I'm talking about---they were these big, lightweight, white blocks with tiny blue specks on them. They were supposed to look like rocks, because they were sponsored by "The Flintstones" TV show.

Anyway, I faintly remember that when I built these Styrofoam houses, I actually tried to build them around me. I would get inside of them, wishing I had still more blocks to make my house taller or wider, unhappy that I was so confined in my new castle. That child's play lasted until I was four or five and then I graduated to a block building kit. There were red, rough bricks for the walls and white bricks for the base of the house. There were even little trim pieces and an assortment of doors and windows. You could make a pretty decent little house with this building set.

I believe the kit even came with wheels and wings and things so one could make other kinds of stuff out of it. I don't remember for sure because I never used those pieces. You see, I always built a house. And by the time I was probably six or seven, I was building some very good houses.

I would take inventory of the wall bricks and the base bricks, and do some quick math to make sure I wouldn't run out of either at a crucial moment. The top of the doors would be equal to the top of the windows and all the windows were set back so I could put little smooth white bricks in front of them to resemble the stone ledges that were on brick houses at the time. I guess you could say I was pretty picky about my houses even back then. I wanted them right, structurally correct and pleasant to the eye. Even as a kid, I was proud of my houses and proud to be the builder. I truly believe those first building blocks are the reason I appreciate houses as an art form and decided to enter the construction trades.

In addition to my blocks, I also grew up playing a variety of board games, and it was at a preteen age that I was introduced to Monopoly. I fell in love instantly. The game's concept was addicting to an impressionable ten year old like myself. I absolutely loved the idea of buying and owning more than one house. And to be able to buy a few houses, then eventually trading them in for hotels, collecting high rents each time someone landed on one was just amazing to me. It was a fantastic game that I used to play for hours. I am sure it was this game that made me love real estate as an investment.

When I entered high school, I ended up taking drafting like everybody else because it was mandatory. I thoroughly enjoyed it for a variety of reasons. First off, I was very good at art and I loved to draw. Drafting was an extension of that drawing. Second, like most kids in the 70's, I tuned into "The Brady Bunch" after I got home from school. Now, besides the regular reasons to watch "The Brady Bunch", like the previously mentioned Marcia episode, I also watched the show because I liked the Brady house. It was so much cooler than the 1,000 square foot rectangular ranch I grew up in. Their house had not one or two, but three patio doors! It had a huge fireplace and cool stairs. It had beams and built in planters. And on top of all that, the father, Mike Brady, designed it himself. He was an architect and he got paid to design "hip", "cool" and "funky" buildings. So it was because of him that I entertained the thought of being an architect.

It's safe to say that I loved mechanical drawing and if I wasn't drawing cars, which is my other passion, I was drawing something pertaining to houses or buildings. You can see by these few stories that as a child and young adult, I had a passion for all kinds of real estate.

Once I entered adulthood, life became centered around other activities: hot rods, girls, jobs: you know the routine. And like most people do as they grow up, I spent more time on things I had to do and less time on things I enjoyed and wanted to do. I was concentrating more on day-to-day survival and bill paying than on what I was truly passionate about.

Of course, we all know that day to day living can become routine and routine sometimes becomes the only dream we chase. Eventually though, if you're lucky, there will come a point in your life where you'll realize that the routine you are following is not the routine you want. Maybe it isn't paying the bills. Maybe it isn't making you happy. Maybe it's not what you're passionate about. Whatever the reason, you just know what you're doing isn't working. You wake up and know you need a change.

That point hit me at age 28. I didn't have much money, I didn't like my job and I definitely didn't like my routine. Suddenly, I found myself giving serious thought to my future. After some deep soul searching, I reasoned that I needed a career change: one I was good at and hopefully could enjoy. And if the new career made me financially independent, that would be a huge bonus.

It was during this time that my passion for real estate resurfaced and I realized I wanted to be a real estate investor: play Monopoly in the real world, so to speak. I figured I better get myself an education if I was going to be successful in such a fast paced career, so I started thinking about getting a real estate sales and broker's license. Understand, I didn't want to sell properties; rather, I wanted to familiarize myself with all the terms, procedures and contracts involved with real estate transactions.

The catalyst for this decision was a simple haircut. It was the mid 1980's and I was getting my hair cut by my usual stylist who I'd gotten to know over a period of time. During one conversation, she happened to mention that in the state of Indiana to get a license to cut hair, over 1,000 hours had to be put in toward schooling, study and practice. Deep down, I was glad for my own cool appearance sake, that she had that much practice, but it seemed like a lot of time to put in just to give me an $8.00 haircut!

Now the reason she told me this story was because I mentioned to her that I was debating about getting a real estate sales license, which would require 55 hours of schooling: time and money I wasn't sure I wanted to spend. Once she reiterated how many hours she had to go to school for her career, two questions popped into my head. #1: How could a mere 55 hours produce an educated, professional real estate agent when it took 1,000 hours to produce a professional hair stylist? and #2: Would I entrust the handling of my house buying decisions, a much bigger decision than a simple haircut, to someone with only 55 hours of schooling? It was then that I figured if I was going to lose my money in a real estate transaction, it wasn't going to be because I lacked education, forcing me to trust someone that I thought knew more than I did. No way. I would get the education myself and any mistakes made would be placed squarely on my shoulders.

Because of that conversation with my stylist, I went to school, got my salesman license and a year later after doing my required office time, obtained a broker's license. I probably spent $700 and invested 300 hours, including schooling and required office time, to get both my sales and brokers licenses. I even listed and sold two houses in that year, earning some commissions. That was a nice extra bonus, but the greatest benefit was the understanding I achieved of how contracts and computers work, how to list houses and where to find them, as well as all the vocabulary and math involved in title work, deed prep and closing statements. It was a good education for a fairly small amount of money and time.

As a final addition to my background in real estate school and home construction (I spent my years out of high school working different construction jobs), I proceeded to buy tapes, books and videos on real estate investing, devouring as much information as I could.

These preceding stories tell you that I was 28 when I started mentally preparing myself to be a real estate investor, but it wasn't until I was 31 that I started physically buying real estate. To become an investor, I wanted to buy a house that needed fixing up and live in it during the rehab process. Then when that house was complete, I would buy another house and rent out the first one, repeating the process again and again. Even though the thought of tenants and tenant related problems scared the daylights out of me, that's how I was going to start my investment career. I wasn't married and didn't have any kids, so it would be pretty easy to move from house to house. That was my plan, plain and simple. But as we all know, plans get detoured. Here's what really happened:

I bought my first house and while I was working on it, it burned to the ground. (Yes, this really happened.) Talk about unplanned detours: instead of having a house to fix up, I had one to sweep up. What a dramatic, unforeseen change of plans. All of a sudden, within a matter of a few hours, I was paying a mortgage on a house that didn't exist anymore, while paying rent on the apartment I lived in, working my job, and on top of that, learning how to deal with police ( I learned they blame you first), how to settle with my insurance company (they always have more questions) and how to come to a general understanding of what happened (beware of halogen lamps!) All this took a year out of my life but it gave me the serious kick in the pants that I needed to jump full force into my real estate investing career.

You see, after I got that whole mess straightened out, I came to the realization that no matter what kind of tenants I had, if they were just average, decent people, there was no way they were going to cause me as much heartache and headache as what I'd just been through. It dawned on me that if I came out of that disaster alive, strong and able to move forward with my life, no matter what tenants threw at me, I would come out of those situations alive, strong and able to move forward as well. So the notion of "problem tenants: wasn't so daunting anymore. I simply decided to eliminate the people who would cost me money and concentrate on the ones who would make me money. Simply put, that meant I had to rent to top notch, high quality people.

Once I truly realized all I needed were quality tenants to succeed, and I coupled it with my newly discovered confidence after the fire, I knew it was time to become a bona fide real estate investor. All I needed to do was pull myself together. Commit and focus.

So I did what many people do when they want to accomplish something they are afraid of or something that seems overwhelming to them. They pick an inspirational hero or mentor to help fuel their fire. I chose Rocky.

For those few readers who don't know who Rocky is, I'm talking about Rocky Balboa (played by Sylvester Stallone) from the 1976 hit movie, "Rocky" about a fighter who was given a shot at the title. This movie came on screen when I was a geeky, unconfident teenager, and after watching it, the movie soon became one of my all time favorites. It is uplifting and inspirational.

If you've seen the movie, you'll remember that Rocky was barely scratching out a living as a bill collector for a loan shark. He was uneducated and a little slow, without much ambition. He was a good fighter, but he lacked focus and commitment. In fact commitment, and what can happen once you decide to give your all to your goals, actually ends up being the main theme of the movie.

During the film, the heavyweight champion of the world, flamboyant Apollo Creed (played by Carl Weathers), decides to give an underdog a shot at the title and based purely on Rocky's nickname, "The Italian Stallion", he picks Balboa. Of course, Apollo perceives the fight as a huge promotional affair, but Rocky sees it as a chance to finally be somebody. He doesn't even care if he wins the heavyweight title as long as he can just go the distance and last all 15 rounds against the champ. This is Rocky's last real chance in the boxing world and suddenly he has focus. He has commitment.

Before my house fire, I was kind of like Rocky. I wanted to be an investor. I wanted wealth and the lifestyle it could provide. I just didn't have the focus or commitment. But with my clear realization in place and a mentor to help me focus, I was ready to begin buying investment property in earnest.

Soon after my newfound focus, I traded my bright red, supercharged, big block '68 Camaro (I told you cars were my other passion!) as a down payment on my first real estate investment property. This first purchase was a fourplex on 2.5 acres. Since that first acquisition, I've been hooked: buying, selling fixing and renting property for over a decade now.

All during that time period, I've tried to keep 12-15 rental properties on hand and I'm proud to say that in that decade, I've never been forced to evict any of those tenants. Of course, I had tenants fall on hard times or break some rules, but because they were quality people, we were able to communicate and compromise, thus solving whatever problem arose.

My desire to write this book came as the result of a couple of factors. First, after searching the big bookstores, I could not find any books that solely addressed the issue of finding and evaluating good, stable tenants. Many books devoted a paragraph or possibly a chapter to the topic, but overall, I found the information was incomplete.

Secondly, it seemed everyone I talked to with an interest in real estate investing, whether active or not, was afraid of tenant problems or had tenant problems. All these conversations made me realize that there was a genuine interest and need to develop and make available my tenant selection process, especially since my tenant related problems are generally few and far between. Therefore, I decided to organize my system of finding quality tenants and make it available to the public in a how to format.

This system for tenant selection is broken down into 5 steps. I call them the 5 P's of tenant selection. They are as follows:

• Step 1 - Prepare
• Step 2 - Pre-qualify
• Step 3 - Paperwork
• Step 4 - Process
• Step 5 - Payoff

Used properly, these 5 steps will dramatically improve the quality of tenants you place in your rental units. Each step comes with the corresponding forms and I've included a CD in the back of the book so you can access these forms anytime you need them.

In conclusion, since this book is a training manual of sorts and I know firsthand how boring those can be, I've inserted some memorable TV scenarios to provide an edge of entertainment value to what you are about to read. I sincerely hope you enjoy the book and after reading it, greatly improve your odds of finding a quality tenant.

So get focused. Be committed.

And as Rocky's coach, Mickey said, "Go get 'em, Rock!"

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Please purchase my book"How to Find That Quality Tenant". Ask your locale bookstore or see my website at:www.findthatqualitytenant.com

Thank You. Don Conrad

Copyright 2006 Blue Collar Publishers
www.findthatqualitytenant.com
e-mail: donconrad@findthatqualitytenant.com
phone: 1-888-452-0765