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| The Art of Eviction |
Investing in real estate is a tricky business. For people who
have a lot of extra income and are just looking to make sound
investments, real estate is a great way to go. Real estate
investment properties provide high returns, and many would argue
- including Bill Montgomery of Trophy Homes - that real estate
returns are even higher than returns on stocks. Whether or not
this is true, one this is certain. The higher the returns are,
the more risk an investor takes on. That is to say real estate
investments can become very risky and cause a lot of headaches
throughout the course of the investment process. High returns
are accompanied by high risks. But you already know that, which
is why you are interested in finding a good investment property to begin with. So
let's take a look at one of the major problems that can arise
when you invest your extra income in real estate.
Real Estate Investment Partnerships
Typically, the structure of a real estate investment team will
consist of two principal players or partners. First, there is
the partner who |
brings in a lot of extra income, and thus provides the cash in the
partnership. We might think of this partner as the cash partner.
The other partner serves a different role. Normally this partner
does not have as much extra income, and thus does not contribute
substantially to the cash position of the partnership. Rather
this partner provides his experience and time to the
partnership. Often this partner is known as the managing partner
because he takes on the role of actively managing the investment
properties and ensuring the ongoing success of the partnership's
investment.
Suppose a partnership found an apartment complex with 100
spaces, a high occupancy rate, and a reasonable capitalization
rate. After crunching the numbers the data supported what their
intuition had already suggested - this apartment complex will be
a great investment opportunity. After discussing the investment
at great length, both partners agreed to move forward with the
investment.
Everything was going great until about a month later, when the
managing partner realized there were a few tenants |
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that had not
paid rent for the last 3 months. Suddenly the disadvantages of
investing in apartment complexes and serving as the managing
partner are being realized. The managing partner takes care of
the day to day responsibilities, which typically include the
dirty work. In this scenario, the managing partner needs to
evict several tenants from the complex for not paying, but
eviction is far from easy. Having to perform an eviction is one
of the realities of becoming involved in real estate and
managing properties. If you have ever spent any significant
amount of time in this industry, you likely have been faced with
an eviction situation before.
Time for Eviction
As a managing partner you hope all your tenants pay their rent
in a timely manner and that there are never any problems. But
this is hardly ever the case. If you are unable to obtain
payment from a problem tenant, then eviction is your only answer. If you are forced to
evict a tenant, before you can take action as a landlord, you
will normally need to file the necessary eviction papers with
the county. The |
tenant will be given a certain number of days to
respond to the eviction notice, and should he fail to respond in
the set time frame the court will likely rule in your favor and
serve an eviction notice.
At this point, it will only be a matter of time before the
eviction is actually completed and you are in full possession of
your apartment unit once again. After that all you can do is
maintain a positive outlook and try to rent out the apartment as
soon as possible so you can realize high returns on your investment property
and produce the extra income needed to make your next
investment.
Adam Smith is an internet marketer specializing in
affiliate program management
for 10Xmarketing.com.
More information regarding eviction can be found at OneMinuteMillionaire.com
About the author:
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