The Truth

With the exception of maybe homeschooling, I can't think of many other opportunites in my life where I have been given unsolicited editorials by well-meaning people who know nothing about me or what I do.

When I wrote about Facebook Debbie's behavior, I realized how angry I am at those who judge us for owning rental properties. Facebook Debbie doesn't know I own investment homes. But there are those close to Marty and I who do. There are some in our closest circle who judge us harshly. Family has called us greedy business owners. I have been told I am out to exploit others for our own betterment. We have been classified as slumlords, hurting our fellow man, stepping on them on our way to the top.

Just so we are clear, most of the people I know don't care one way or another what I do. I am good with that. Nor am I talking about those folks I run into who just want to know what brought me into this line of work. They may be curious what it is like. Sometimes they ask questions. Sometimes they don't. But there is a healthy respect between me and them. It isn't their thing. I get that.

But there are also those who condemn us landlords for wanting to better our family and our lives. Some of them are family. Some are friends. Some are strangers. One time there was a member of Marty's family who needed medical attention insurance would not cover. We were approached by other family members to help them cover the costs. We came up with our share. However, when it was time for other family member's to step up, Marty's sibling told him, "You don't see me buying rental homes. You can pay for it (the medical treatment)."

I had a friend once who flat-out told me she resented that I bought rental homes. She couldn't understand why I would exploit someone that way. "What way?" I asked. Because I really didn't understand. I know people who rent for a variety of reasons. How is it exploiting? One has to pay to live somewhere. I believe in the free market. If I have a home that someone wants at a rental price someone wants to pay, that isn't exploiting. I am sad to say this friend and I ended up parting ways. I felt condemned. She felt misunderstood.

At one time I used to defend my choices. I would vainly explain to the Facebook Debbies of the world that the landlord isn't evil because he wants what he is contractually owed. He may have character and ethical flaws that warrant that label. But, the very action of owning an investment property doesn't make him sleazy. But the sound of my voice never reached their ears.

Here are some truths (in no particular order) about me, the greedy landlord:

• I believe my job is one of service. I live this in how I behave--not just with my Alabama business, but with everything I do. I don't righteously proclaim it, I live it. And, I invite anyone to to publicly call me on this if they don't agree.
  
• I serve my tenants. They are given a quality home. I expect something in return. Integrity and loyalty. I generally get it.
  
• We expected to sell our homes within five years of purchasing. The economy turned. It didn't happen. We don't blame anyone for our choices. We are solely responsible. We are solely accountable.
  
• We had no control over the economy. This affected everyone, partners and tenants alike. I am proud to say we paid all our bills when economic times were at their worst. We may have had nothing left over, but I would rather have nothing than go into foreclosure.
  
• Last summer Marty Sunshine had to dip into his 401k to cover our bills. I am thankful we had the money there. That covered a home that was vacant for five months, someone who declared bankruptcy and didn't leave my home, three new air conditioners we weren't planning on replacing and a multitude of other repairs.
  
• I went to the bank Wednesday and asked for our current balance. I wanted to make sure we had the money to cover the mortgages. We did. I was relieved. I have three more rent payments coming in, so we even have some money left over this month.
  
• There have been times Bliz and I have discussed which bills to pay and which ones to wait on. Because if someone doesn't pay the rent someone doesn't get paid.
  
• I am happy to fix a roof. If the roof is actually leaking.
  
• There are years we have made a profit. There are years we haven't made a profit.
  
• In the past year, I have lowered rents on five of my homes. The economy warranted it. In every case I am happy with my choice of tenants (even Mrs. Spring).
  
• If something on a rental home fails (plumbing, heating, etc.), we fix it. We put our tenant's comfort in front of our own. I have gone without purchasing a dryer and living room furniture because I wanted to make sure my renters had what they needed.
  
• I will bend over backwards for a tenant. And have. My tenants tend to be long-term because of this. In the month of February, I had TWO former tenants call me asking if they can rent from me again. I get about a call a month from someone who heard about me and wants to know if I have anything available. I believe this stems from the fact that I am not a slumlord. And to my knowledge, my tenants don't feel exploited.

And Justice for All

It seems that Facebook Debbie got her day in court a while ago. You can read about Facebook Debbie here and here if you are so inclined.

Though she didn't exactly say what the outcome of her court date was, she did write about how she was still fuming over her "sleazy" landlord. She mentioned the judge's eyes were "clouded" and he was "influenced by the wealth of the landlord." From what I gather, justice was served.

She made a lot of other derogatory comments about how she was ripped off by the landlord and some general comments about those of us who own rental properties only doing it for our self-interest (which I suppose is true) and to make "millions of the backs of others." Incidentally, I would like to see those millions she was talking about.

Her friends had a few other random comments of a similar nature. There was no point in posting myself. I was pretty sure they had no interest in reading a dissenting opinion. Perhaps they can contact me directly if they want to know how much work goes into managing a rental. But I doubt it. After all, I am the rich, money-grubbing, sleazy landlord who is rolling in my millions.

Random Bama

I finally booked my trip. So far, I know I want to pop in on a few tenants and say hello. I really want to see this roof leak Ms. Shirley is fussing about. However, I am not anxious to meet Ms. Shirley. Mr. 114 tells me she has a boyfriend living there that she has never mentioned to me.

I will also be driving by a few other homes where I really have no compunction to meet the tenants. Mr. Green my tenant who is always looking for some obscure broken thing at this home is not someone I want to get to know. I figure if I were to show up, he and his mother-in-law (who lives there as well) will probably hit me with a laundry list of items they want me to repair. I am not against repairing them if they are legitimately broken. I am against being railroaded.
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Attorney Jon and I are playing phone tag over a minor situation that came up this week. However, I find that I am hesitant to call him back because I am so intimidated by him. I am just not worthy.
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I am almost done with tax document collection. I have breakfast set up with Diamond Jim for next week. As of Tuesday morning, we had already covered all tax-related questions. So, I am guessing next week will be a social visit.

Tax Season

Marty Sunshine and I own a corporation and three LLCs. Additionally, I am self employed. When it comes to filling out our tax forms, we haven't done a 1040 EZ form in eons. I am guessing I am competent enough to muddle my way through the mountains of tax forms necessary and figure things out myself. But I only have until April 15. Or, more likely, October 15 (if I file an extension).

Though Bliz has a variety of talents, including walking on water (especially because it is raining a lot where she is), she politely and assertively refuses to handle my tax preparation. Yes, she helps me with taxes by putting everything in nice, organized profit and loss columns. She is invaluable when it comes to navigating Wells Fargo's web site and faxing me the mortgage interest statements necessary for the IRS. But, she draws the line on organizing all the expanded data that goes with my tax season preparation.

If she did, it would be phone calls like this:

Bliz: "What do you have a receipt dated June 16 for $4.18 from the grocery store?"

Me: "Oh that! I bought eight stamps and a Dr. Pepper. I think. Can't we write off the Dr. Pepper under entertainment?"

Bliz: "Put it under supplies. Here's my bill. That will be $500 an hour."

I am guessing she feels tedium should be saved for more productive tasks.

This past week I have sorted, sifted and cursed through a small tropical rain forest of papers getting everything together for Diamond Jim. I have everything I need except one mortgage interest statement document that our former business partner, Vance, happens to have. Marty Sunshine is tasked with hunting this one down.

There are those who question my organizational skills. But really! I have a system. I have a spreadsheet that itemizes every receipt I acquired in 2009--whether for business or personal. Because I have a home office, I can write off a portion of my pest control, electric bill and pool maintenance. I can write off my Home Depot receipts if I so desire.

Why go through all this? Because every tax deduction helps. I want my money back so I can do something more interesting with it.

The "Roof Leak"

Ms. Shirley and I are in month two of the water leak drama.

Here's how it stands. Ms. Shirley lives in a 10 year old home. The bonus room--where the offending water leak resides--is an unfinished room above her garage. The ceiling is finished; the walls are studs. The floor is plywood. There is a window overlooking the front yard. This room is an Alabama home's answer to an attic space. Ms. Shirley uses this room for storage and as a playroom for her son.

According to Ms. Shirley, there is a "wet" spot on the floor in this room. According to Mr. 114 (her next door neighbor and my some-time handyman) there is no evidence of a soft spot or discoloration in the finished ceiling. There are no missing roof tiles. There are no pipes in the floor or ceiling below or above this spot that might be leaking. There are no roof vents above this spot where there might be a flashing issue. The spot is not near the window, thus Mr. 114 came to the conclusion her son spilled something on the floor and it discolored the plywood.

Over the course of time Ms. Shirley has lived in my home, Mr. 114 has told me a few things about her. For example, once she came zipping into Mr. 114's driveway, laying on the horn of her car until Mr. 114 came out the door. There was a frog on her driveway and she needed Mr. 114 to remove it. Apparently Ms. Shirley is terrified of critters.

I was also told by Mr. 114 that Ms. Shirley once asked Mr. 114 if he thought I would replace the stove for her. Why? Because her electric bill was $300 one month. Mr. 114 (who told me about this after it was over with) explained that it wasn't likely to happen and went over to see if he could figure out why her electric bill was so high. First, the air conditioner was running and the house was freezing. Second, the attic/bonus room door was open, allowing the cool air to escape. Mr. 114 suggested a couple of energy-saving modifications and voila! Ms. Shirley's bill was reduced the following month.

I am also told Ms. Shirley doesn't like dust, mold or dirt. All of which sets her into a bit of a frenzy. Not liking animals or dirt are wonderful traits to have in a tenant. Except when there is a discrepancy about a water leak.

Part of me is thinking Ms. Shirley wants out and is going to eventually scream "toxic mold" because of this "water leak." Part of me thinks she really feels there is an issue. There is no part of me that feels this leak is legitimate.

Ms. Shirley has gone so far as to call a roofer, tell the roofer I AM OUT OF TOWN AND HAVE NOT SEEN THIS and could she get a quote. The roofer told her I could have insurance pay for the roof and he could put it on as soon as possible. Even if there is a roof leak, the house certainly doesn't need a new roof. I would think it might need a shingle or two at the most. If that.

I explained to Ms. Shirley that I have an insurance deductible, so the roof isn't "free." If my insurances rates go up, I have to increase the rent (she is month-to-month). I also explained that a roofer's job is to put a new roof on--not to just check to see if it needs to be fixed. They don't get paid unless there is work to do. Hence, they look for work.

"But these people are with the Better Business Bureau. And, they are Christian," she said. I didn't point out I had a "Christian" pastor trash my home years ago. There was no point.

I reminded her that Mr. 114 came and poked around on my behalf last month. "He didn't really look hard." she said. Mr. 114 could have torn the house to shreds and put it back together again and Ms. Shirley would have discounted that.

I am certainly willing to admit when I am wrong. She is over there and she would know if there is a leak better than me. But it just isn't adding up. I am putting paying a visit to Ms. Shirley's home on my to-do list for my hypothetical trip to Birmingham. I will check it out for myself.

If there is a leak, Mr. 114 can fix it.

Another Fabulous Business Meeting with Diamond Jim

Diamond Jim, my CPA, is the only man in the world I will consider waking up for long before the chickens are even moving. Every now and then we meet at Cindy's Cafe, a few miles from my home and his office to visit over eggs and hash browns.

Thursday's business meeting included the following topics: the status of the public schools in Greenville SC, tough love tactics for drug abusing children, theology, C.S. Lewis, whether or not the Diamondbacks have enough salary to offer Mark Reynolds and Justin Upton long-term contracts and why some people insist standardize testing on young children is necessary.

As usual we discussed taxes in the parking lot as we were saying good-bye.

Lunch with Mr. Partner

I had lunch with Mr. Partner on Wednesday. Though this can sometimes cause indigestion, Wednesday's lunch was pretty amicable.

I should preface this with Mr. Partner and I are pretty friendly in general. We had a history a few years ago with him exploding about something completely out of my control and me telling him where he could go and what he could do when he got there in a very un-Southern way. Since then Mr. Partner and I have practiced levels of détente, with me still holding a teeny-tiny (or enormous) bit of a grudge.

Lunch was pleasant enough, given we were going through last year's financials--which were anything but pleasant. He had a few questions. I had reasonable answers. I hit him up for our LLC paying part of my expenses for my upcoming (and thus far, unscheduled--it is SNOWING over there people!) Birmingham trip.

I was able to tell him all of our tenants are behaving. He gave me kudos for working through the issues with Ms. Kathy. He agreed that we did the right thing for Mrs. Sherwood--and was even willing to buy her a stove if she changes her mind. Ms. Angie is owed some work. She will get that done, now that I know Mr. Partner is committed to paying for his half.

And, in a broad-sweeping gesture, he suggested I make sure I pay myself for the work I have been doing. Um... about that... As soon as the money becomes available, you bet I will!

I gave him my action plan for fixing our under-capitalized issues. He nodded, not really agreeing or disagreeing. It doesn't matter. I am working on fixing that either way.

It is nice to have lunch with Mr. Partner when we aren't in the midst of chaos. Lunch tastes better and digests more easily.

The Plight of Mr. Jordan (Part 2)

Marty Sunshine and I have been discussing at great length Mr. Jordan and his situation since I found out his homes are in foreclosure. It chills me to think this happened to him. He, like us, was undercapitalized. He, like us, had his fair share of rental homes. He, like us, opted to manage them himself long distance.

His situation really got me thinking. What was different?

1. We have business partners. Mr. Partner and Jack share part of the burden. With Jack, if something breaks, we pay half. With Mr. Partner, if the money is available in the coffers, we take it out of there. Last summer we had three trashed homes and the money wasn't available in our business account. We both put in some to cover our expenses. And, we had a few.

2. Location, location, er... location. I have one house on a minorly busy street. It is in a questionable neighborhood. Next door lives a crack addict. Across the street lives the guy who stole my air conditioner. These people didn't live there when I bought the house. But, if I knew then what I know now, I wouldn't have bought in that neighborhood. Most of my homes are scattered over three counties in the greater Birmingham area. Mr. Jordan's homes were in the same subdivisions, thus making the neighborhood one big rental zone. Most of his houses backed major roads or undesirable retail establishments. Even renters want to avoid living in places that back to those conditions.

3. Quality homes for quality people. Mr. Jordan preferred section 8 renters because he is guaranteed rent. However, after dealing with the aftermath of his tenants, I am here to tell you, I witnessed what these homes looked like when they moved out. The one tenant he had who was not section 8 actually vacuumed on their way out the door. His section 8 tenants always left the home in poor condition. His properties were brand-new in 2004 but they looked like war zones on the inside. Always.

4. Vendors. Jack doesn't manage my homes. He helps me find new ones (when I am in the market). My electrician gets paid on time. I trust Carolsue to handle my chores--and she gets paid for her time. One time I called a locksmith for Mr. Jordan so I could get into his property. Mr. Jordan was supposed to call over his credit card information but "forgot." The locksmith began calling me for payment. This went on for weeks, with me finally threatening to quit helping Mr. Jordan until he paid his bills. Miraculously the locksmith got paid right after we got off the phone.

5. Neither Mr. Jordan or I are against property management. However, the property manager he used called me one day, completely exasperated wanting to know how I tolerated this guy. She didn't believe me when I told her I found him comical. But, I did. She fired him. Then he fired her. Then he hired another who fired Mr. Jordan as well. Then Mr. Jordan called me begging for me to take over. It turns out, he didn't trust their expertise and didn't want to pay them either.

6. Face time. In the three years I worked with Mr. Jordan I never met him. I may not jet over to Birmingham very often, but I know that showing up once in a while lends to my credibility.

7. Marital bliss. I am not making light of Mr. Jordan's situation, but know he went through two wives in the time I worked with him. Divorces in Southern California can't be cheap, especially when you put your new wife on the deed to the property. Mr. Partner is happily married to a patient woman. I have a patient Marty Sunshine. It makes a difference.

8. Speaking of patience. Mr. Partner, like us, is aware we aren't getting our money back any time soon. I firmly believe Mr. Jordan treated his real estate endeavor like he was day trading.

9. The last resort. I don't know what happened to Mr. Jordan and his homes. Maybe he let them go for other reasons. Maybe his heath was in jeopardy. Maybe he needed to liquidate. Maybe he was looking for a new hobby. Maybe he just gave up. Though we make our fair share of blunders, we aren't willing to look at any other alternative other than success. Failure to us is foreclosure. Therefore, I am going to plod forward. No matter what. I have felt financially vulnerable for quite a while. However, I have refused to think of what failure might look like. It isn't in the picture.

In no way do I think I am better than Mr. Jordan. A lot of what has gone right for us is because of dumb luck. But I also think one of the reasons we move forward is that we are willing to readjust when things aren't going right. We had a plan to sell our properties after three years and make a tidy profit. When the real estate market didn't agree with us we adjusted our plan to make what we had work. Or at least not fail. Sometimes not failing is success as well.

Postscript: After I wrote this, I saw that Happy Camper posted the following. I thought it was fitting (and thanks again Happy for being my source of wisdom).

The fight to the finish spirit is the one ... characteristic we must possess if we are to face the future as finishers. - Thoreau

The Plight of Mr. Jordan

I am saddened to see Mr. Jordan is loosing his homes.

A long time ago, Mr. Jordan was my client. Imagine if you will... Mr. Jordan described himself to me as an 6-foot 5, African American, former Marine, who referred to himself only in the third person and liked to rub elbows with (or at least name-drop) high-profile celebrities in Southern California, which happens to be where Mr. Jordan lives.

Mr. Jordan from my vantage is an eccentric. He makes eccentrics look pedestrian. I can only describe the client-agent relationship as "surreal." For example, one time he bawled at me because his latest wife (of six weeks--which is longer than the courtship lasted) left him. I wasn't anywhere near my Miss Manners Guide to Perfectly Behaved Real Estate Agents, so I wasn't exactly sure the best way to handle this particular situation. I listened as he told me his woes. Two days later he called me in the best of moods and asked if I knew someone I could introduce him to because he was (and these were his words) "ready for action."

During our tenure, I sold a piece of land he owned at a time where a home oozing with nuclear waste would have multiple offers in less than 10 minutes on the market. So, this wasn't much of a stretch. However, Mr. Jordan thought I was a rock star, even though I explained over and over it was just market factors. Nevertheless, he decided I was the agent for him. And let me know it. Often.

Before I came into the picture, Mr. Jordan was sitting on approximately eight rental homes that he had purchased over the course of the real estate boom (around 2004-2005). Apparently, he found the last home builder in the Phoenix metro area who was willing to sell to investors instead of homeowners. So, Mr. Jordan bought as many as he could. However, the homes he bought weren't in ideal locations. All of his homes were within a five-mile radius. They mostly backed major roads. And in one case, the home backed a Mexican flea market.

What I primarily did for Mr. Jordan was help him lease out his rental homes. His homes are in Avondale. I live in Mesa. That is a 40 minute drive when there is no traffic. Of course, I only had to do this a couple times a year, so it wasn't too bad.

The real issue is Mr. Jordan preferred to rent out to Section 8 tenants. Every section 8 tenant he rented to seriously trashed his homes on move-out. I wasn't willing to clean up the properties and get them ready to rent out again. Especially for free. That is what a property manager does. I wasn't willing to be his--no matter how much he pleaded.

Mr. Jordan and I parted ways a few years ago, leaving me lots of tales for my great American novel.

The other day I was in the office and noticed a story about rental homes in Avondale. That got me to look up a few of Mr. Jordan's properties. Which is when I found out they are all in various levels of foreclosure.

There are so many glaring similarities to Mr. Jordan's rentals and mine. The distance. The go-it-alone attitude. The desperation one feels when one has a vacant rental. I thought about his situation and wondered if this could be me if I wasn't careful. What was different?

To be continued...

Making My Heart Go 'A Pitter-Patter

Just like a bell and Pavlov's dog, I have my own stimuli that drives me into various levels of stroke. Carolsue calling me and saying, "I need to talk with you as soon as possible!" is pretty high on the list. So is a text from a tenant saying, "I need your e-mail address."

Friday my phone alerted me with the previous message. It was from Artie. At the moment I was reading my text, Marty Sunshine just happened to have walked in the kitchen. He said my face went white. "Something wrong? Did someone die? That text wasn't about your father was it?" he asked in husbandly concern. "Do you need to sit?"

I just shook my head as my imagination went into overdrive. I expected the worst. When I told Marty about Artie's text, he just couldn't fathom the correlation between my mental health and five words sitting on my phone. But, he didn't know the back story.

A few months ago, Candy had called me OUT OF THE BLUE to tell me about the trouble in paradise between her and Artie. Of course, I have never personally met Candy. Before and after this occasion, we hadn't been particularly friendly. So, this call was a bit unexpected. On that particular day, she said that she "thinks of me as a friend," and just needed to talk. More likely, she didn't want me to be floored if they broke their lease two months later because she wanted to move out. And, right after Candy's girlfriend chat, Artie and Candy bounced the rent check.

So, a cryptic text from Artie had the same physiologic response as putting me in a pit of vipers.

Instead of texting Artie back (which he indicated Friday morning was his preferred mode of communication) I called him, saying, "Hey! I got your text. Is there something we need to discuss?"

Though I am not too sure about Candy, I actually like Artie. He stepped up right after the rent check bounced last October. Now the rent checks come from him. He includes late fees. I wouldn't let him keep his rottweiler in my home. According to Mr. 114, Artie hasn't. Also according to Mr. 114 Artie takes very good care of the home. Mr. 114 hasn't really commented on Candy, only to say he didn't see her there last time he did work for me.

What Artie really wanted from me on Friday was to send me pictures of the aftermath created by the basement flood a few months ago. I knew about this when it happened. And thankfully it is fixed. At the time I knew I would need to call James the Hell's Angel turned Carpet Guy to replace the rotted carpet, but I was waiting until Artie and Candy got back to me. Friday they got back to me. He is sending me pictures. And by the way, Artie told me, the rent will be on time this month.

Give It To Me Straight

A long time ago, back when she was speaking to me (and that would be before I approved her for the home she is living in now), Mrs. Spring sweetly told me my application is "daunting."

Perhaps it is. It is my best tool to screen out the good from the bad. I contend the most I will ever learn about a potential tenant is between the time they express interest in my home to the time they sign the lease. My interest is to protect my asset. And, if Joe and Jane Tenant are worthy, I will allow them to live in my home.

I make no apologies for my arrogance. I have written enough about my mistakes. Most of my crummy tenants came from a lack of standards and desperation. It took me two years to purge the bad ones from my homes, so I think a few guidelines are warranted.

My "daunting" application asks for a myrad of things. For example, I ask for the applicant's name, date of birth and social security number. This way I can run their credit, background check and eviction search. I can't do these things without these three tid-bits.

I ask for a phone number, cell number and e-mail address. If I rent to them, I need ways to get in touch.

I ask for previous addresses and landlord references. Generally I call the second to the last place they lived. That landlord has nothing to loose or gain by telling me about their rental history. The landlord where the tenants are living now might tell me how great they are--just so Joe and Jane Tenant will move out of their home and take their trouble with them. I also verify the addresses they put on the application with the credit report. I like to see consistency.

I also like to see stability. If Joe and Jane move every year, I shouldn't be surprised 11 months into the lease when they give their notice. Moving every year also can mean they don't play well with others--like their landlord. I saw this with Mr. and Mrs. Betty and ignored it.

I ask for job history. I want to see how much they tell me they make. I compare this to their pay stub they must supply. I also want to see what Joe and Jane do for a living. Their job is my business. If Joe is a loan officer during a recession, I might have concerns about how they plan on paying the rent. I love seeing potential tenants who are nurses, mechanics and teachers. These folks are employable.

I ask for an overview of their debt. I match this with their credit history. If they forget to mention the car payment on the application, but the credit report says they are paying $300 a month, I will know. I can expect these kinds of omissions later on when the neighbor mentions their have been sightings of a hippopotamus traipsing around the tenant's back yard.

I like seeing that Joe and Jane have school-age children. That shows me stability and that there is less likely a chance they will be moving next year. This is especially true if they move in during the school year.

I ask for information about their cars. Sadly, I have had occasion to give this information for a criminal investigation once the tenants moved out.

I ask for information about their pets. If they say they have a poodle named "Fifi" and I come over, I don't want to see a Doberman named "Bruno."

I ask for two current references and one family member reference. I want to see phone numbers and addresses for these. You would be amazed at the number of people who "forget" to give me a phone number for references. Of course, I don't really want the reference phone numbers for potential tenants. I want the phone numbers in the event things don't go well and I need to find them later on. I also want their friends to tell the potential tenants I called.

The last page of my application is to see how truthful Joe and Jane might be. I ask lots of personal questions. I ask if there are any bankruptcies, repossessions, foreclosures and evictions I should know about. I like bankruptcies. If Joe and Jane have a recent bankruptcy, that means they don't have debt and can't file on me. If they have the income to cover the rent and everything else looks pretty good, they have a good chance of renting from me.

I can't say the same about an eviction. Nobody with a past eviction rents from me. Ever. Anyone willing to be evicted once will do it again. And please, don't confuse eviction with foreclosure. I will rent to someone with a foreclosure.

I ask if they have been convicted of manufacturing illegal drugs, possession of illegal drugs or if they are a sex offender. Honesty is the best policy on this one, but it won't matter. I check for myself and I won't rent to one. More than anything, I find people who think these particular questions are offensive. My standard answer is that I checked on the last people who lived in the home, and I can assure you, Joe and Jane, they weren't. Therefore you won't have to worry about the former tenant's drug user friends showing up at 2 a.m.

I also ask if Joe and Jane are legal residents of the United States. Legal residents can hold jobs and their wages can be garnished.

My application process tells me more than what is written on the pages. It tells me about a potential tenant's communication skills. It tells me how truthful they are. And, it tells me what a tenant is willing to share. What they might leave out screams louder than what they put on the application.

Me & Matt

I met Matt through Attorney Jon last summer. Matt, an investment banker/mortgage guy has been in the business for several years. Last summer he was starving. Most mortgage guys were. Two months after we met for 30 minutes, Matt called me out of the blue and asked if I had any odd jobs that he might be able to handle.

Matt impressed me when I met with him in person. But he knocked my socks off when he called up a virtual stranger with a zillion homes because the alternative is starving. It spoke volumes for the kind of man he is. This guy wasn't giving up. He needed to feed his family. I am sure I wasn't the only call he made. But, I had work for him. In fact, I kept him busy for the month of September.

One of the things Matt told me after he finished working on my homes is that he prefers mortgage work to painting. And, thankyouverymuch for clearing up any fantasies he might have of handyman work being glamorous. He also told me, thanks to a month of manual labor, he was motivated to start doing mortgages again as soon as possible.

Matt and I kept in touch last autumn. He called me with a rental question or two. I e-mailed him with a mortgage question or two. I have never given him a loan. He isn't too anxious to paint any more of my homes. I am good with that.

For the past week or so we have been playing phone tag. Wednesday we connected. Matt said he just wanted to see how Kirby (the property manager referral from Matt) was working out for me. My psychic landlord abilities tell me there is more to that story, but I couldn't get it out of Matt--a true Southern gentleman.

Matt tells me he is back to mortgage brokering. I asked him about possibly refinancing a couple of my homes this summer. I am not ready for a serious discussion on this just yet. I will be later. He is good with that.

Matt told me to stop by and see him if/when I make it to Birmingham. But in the mean-time we will just keep things between us as is. We are good with that.

Random Bama

When Bliz and I were talking last week, she asked about Legal Eagle's bill. I had been blissfully ignoring the idea of owing Legal Eagle money until that moment--which was when I realized Legal had done a lot of stuff in the past several months, and hadn't been reimbursed for her time.

As it turns out, Legal Eagle had some sort of psychic premonition and came to the same conclusion. Apparently she had been remiss in sending me bills for the past six months. Monday she mentioned she needed to send one to me. It was starting to add up. I am getting an invoice. If she gets around to sending it.

I told her to take her time. Please!

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Matt, the investment banker turned handyman and re-turned banker has been playing phone tag with me. My office hours aren't coinciding with his office hours. It isn't like I don't want to chat. I have a lot of loan questions I would like to discuss with him.

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I still haven't booked my trip to Alabama. I feel the same way about traveling right now that I do about Legal Eagle's invoice. It is a necessity that I prefer to continue ignoring.

Today's Ray of Sunshine

There are times when I feel like I have written all there is to write about my accidental business. Now that I have a handle on crazy tenants and (almost) every conceivable situation possible (hopefully) has been covered, what is left?

I sometimes wonder if I repeat myself too much. If I complain too much. If I whine too much. I feel like I do. This is my therapy blog. But even as such, I know that complaining doesn't make things better. Sometimes I would much rather write about Brandon Webb's (hopefully) comeback season with the Diamondbacks. But, I am guessing my three readers don't check in to read about me pontificating about baseball.

Really cool things happen too. Little things. Even if they are little--and cool--sometimes they, or something similar, has happened before. I am still repeating myself. But it still tickles me. Sometimes really cool little things are pretty personal too but they are hard to explain. If you break it down, how many ways can I express "this made my day" in a 300 word blog?

This experience you may have read before, but it happened again today. It made my day.

I got a call out of the blue from a former tenant. He was looking to move in April. He thought he would give me a call and find out if I happened to have anything coming up in Moody for rent?

Moody by the way, is where Ms. Kathy lives. And, I am sick of her. She and Legal Eagle had a meeting today where Ms. Kathy promised to behave in exchange for a place to live. I think I have written about Ms. Kathy's promises before as well.

I told my caller to call me next month. If I can convince Ms. Kathy to move, I might have a place available. Right now, I am sorry I didn't start the eviction process. I would have preferred these former tenants a million times over. I also followed up with an e-mail giving him Jack's number and Kirby's number. Maybe one of those two might be able to help him if I can't.

I know I have written this before, but sometimes it bears repeating because it always astounds me. The relationships I have built 1,700 miles from my home blow me away.

And, a former tenant calling me out of the blue because they thought highly enough of me to want to rent again from me makes my day.

Swooping In

Last week I had one of those mental head-slap moments. Essentially, why am I dealing with this madness with Ms. Kathy when I have a highly trained professional who can handle this? So, I called Legal Eagle.

Now, I appreciate Carolsue being my heavy with Ms. Kathy, but that isn't fair to Carolsue or Ms. Kathy. Besides, right now Carolsue is on sabbatical while she takes care of a few irons in the fire.

My biggest issue with Ms. Kathy is that I bent a little and she abused my good nature. She won't return my calls. And, when she has given me information in the past, it was to avoid immediate conflict. Ms. Kathy doesn't seem to have the foresight to figure out if she lies to me today, it might get me off her back, but come next week, I will be even angrier. Most of us learned this valuable gem in kindergarten.

I really don't want Ms. Kathy to leave. For the most part, she takes decent care of the home and she has a guaranteed income. She grew up in the neighborhood and has roots. She wants her kids in that particular school system. It doesn't take much to make me happy. And, she will be hard pressed to find a better landlord--as long as she can handle paying the rent.

Her rent issue is a cash-flow problem. She gets her check on the 3rd. Rent is due on the 15th. For some reason, the 12 days between the 3rd and the 15th her money seems to slip away.

When I talked to Legal Eagle on Tuesday, I gave her all of this. I explained how Ms. Kathy is conflict avoident. How she is afraid of me and Carolsue has been handling this on my behalf. I told her Carolsue might have told Ms. Kathy a few things about eviction that are questionable. Legal Eagle just muttered, "bless her heart." I don't know who she was referring to: Ms. Kathy or Carolsue. Depending upon who it was aimed at, the sentiment might have very different meanings.

Legal Eagle is now handling the Ms. Kathy collection. I know Ms. Kathy is getting a tax return. So, if Ms. Kathy wants to pay a half-month's rent, I will move her future rent due date to the 3rd. The other obvious reason for Legal Eagle to handle this is that she can identify Ms. Kathy's in court if we end up going that route. Either way, I don't have to play Ms. Kathy's game any more.

So, To Make A Short Story Long...

I am sometimes asked why am I investing in Alabama. Depending upon who is asking, my answer ranges from a simple shrug to a more complicated answer that involves investor jargon.

Once upon a time, when loans were easy to get and down payments were low, Marty Sunshine and I bought our first rental property near our home. After the shock and the naivety wore off, we found it to be a decent endeavor, so we bought a few more in the general vicinity of Mesa Arizona. Some of these were with business partners. Some weren't.

The people who lived next door to the first rental home we bought moved to Alabama. When they got there they said they were having trouble finding a rental home, and would we be interested in buying one. They found one they liked for about $80,000.

At the time, real estate in the Phoenix area was selling for about $150,000 for something comparable--but probably closer to $200,0000. And, at the time, real estate was doing this thing you might have heard of called, "appreciating." Additionally, I found out I could rent that $80,000 home in Birmingham for $850, or roughly 1 percent of the home's purchase price. A particular metric Mr. Partner happens to like. And not a metric you are likely to find in the Phoenix area--even today.

A few months later, I got a call from the agent I used on the first transaction. She knew a family who was in a situation where they had the income, but couldn't qualify for the home they were looking at. My agent insisted these people were top-notch. Was I interested in helping them out? That family is still in my home, living happily. I have never personally met them.

I wasn't really planning on making Birmingham my main focus, but the market here in Phoenix started getting out of control. At the time, I couldn't buy homes in Phoenix for anything close to what I could buy them in Birmingham for and make any type of cash flow. We sold what we had here and bought over there.

I also found out how bad the shortage of rental homes happens to be in Birmingham. With the agent's permission, a few months later, on a lark, I put an ad in the paper one Sunday with the agent's phone number. The ad was supposed to run for a week. I advertised "rent to own, you find the house, we do the rest."

My agent called me around 11 a.m. Sunday morning to tell me her voice mail was full, her phone hadn't stopped ringing and, what exactly did I have in mind? "I don't know?" I said. I was expecting about three calls total. By the end of the day, she had over 100 calls.

First thing Monday, I pulled the ad. I immediately begged Bliz to keep my books, screened a few of the potential tenants, got my investors together and bought several homes. I still have the homes, most of the tenants have moved on or have sold their homes and all but Mr. Partner is left from my original three partnerships.

There was a time when I would have told you managing five homes long distance was a chore. Now that seems like nothing. I sort of miss having only five homes. As the market has changed, so have our challenges. But, like Marty Sunshine has reminded me, we would have challenges here too.

He's Taken Ladies

Since the beginning of the year, I have become a full time real estate agent once more. And, because of that, I have become a lot more organized.

Ok, we need to take a moment and pause here while Bliz cleans up the chi that came spurting out of her nose.... Take your time Sweetie. We understand.

Seriously though, especially with my accidental business, I don't have time to put off the multitude of things I would rather put off. Like taxes. Like filing. Like forecasting. All of which I started working on this past Sunday. Ok, the "taxes" thing is a bit of a stretch. I worked on helping Bliz finish out the year end books so she could send me the profit/loss statements so the K1s could be dispersed to those who need them.

Sunday I worked on forecasting. Marty Sunshine worked on my filing. And, before all of you say, "what a guy!" (cuz he is!) on Saturday he made breakfast before I left for the office. While I was gone he mopped the floor, vacuumed, folded laundry, mowed the lawn, cleaned the pool, went shopping for a birthday present for a 10 year old girl, bathed the kids and took them to a birthday party.

Now on to taxes...