Summer 2014

Inside The Newsletter

Page 2 | Dodd-Frank 2014 Part

Two: New Federal Rules

for Consumer Mortgage

Loan Servicing and Loss

Mitigation

Page 7 | For Sale by Owner

Page 9 | How Landlords Can

Have a Great Vacation

(And Not Worry About

Their Rentals)

Page 9 | National REIA Benefits

Page 11 | Bathroom Essentials on

Move-In Day

Page 12 | OfficeMax Discount

Card

Page 15 | Lease Clauses

Back | Information about

Cover Joining Board of

Directors

The office will be

closed for Labor Day,

September 1st

Next dinner meeting

will be Thursday,

September 25th at Bos-

2014 AWARDS

PROGRAM

Enter the AANP Awards Program, which recognizes the efforts of our members to improve their property. Take pictures BEFORE you begin your project and AFTER your job is complete. Submit the pictures along with your Award Program Application before October 31, 2014.

Official rules and application form are available on our web site, and at the Apartment Association office.

PRESIDENT’S MESSAGE

By Joel Miller

One of the things we do at our annual business meeting in September is elect the board

members for 3-year terms. We have several long-serving board members who are up

for re-election and who have agreed to be on the ballot again, and we need experienced

board members to help us do the job right. But not all of them may return, so we need

some new blood on the board too! Also, as our Association grows and offers more and

more features to our members, we are considering adding to the number of people on

the board so that we can spread the work around more. Particularly, we need

someone experienced with IT enough to help Mike Shugerts with certain things

like updates to our web site and computer equipment. There are other things we

have in mind if we can get some new people, so no matter how long you’ve been a

member and no matter how many or few units you own (those things don’t necessarily

matter), please consider taking a turn on the board. All you need to do is submit a brief

resume to the Association office as it pertains to your real estate investing/landlording

background to get the process going.

On another matter, please check out the Adverse Action form that is now on our

website for your use. This form must be provided to any applicant whom you turn

down for an apartment based wholly or in part on their credit report. This is the

“rejection” that one must get from a creditor in order to get a free credit report in order

to see if one has any inaccurate information on their report. So, if you’re a creditor/

landlord, you are required by law to give a notice like this Adverse Action form to

anyone you reject or there could be penalties for you. It’s very quick and simple to fill

out for someone, and you have no involvement in the matter past that point.

THE

APARTMENT NEWS

Apartment Association Of Northwestern Pennsylvania, Inc.

1127 West 38th St. Erie, PA 16508 | (814)866-7414 | Fax: (814) 866-2732

Open Mon-Fri 9:30 am to 5:00 pm | office@aptassoc.com | www.aptassoc.com

WE ARE 1,600 STRONG — REPRESENTING 19,900 RENTAL UNITS

Page 2

Dodd-Frank 2014 Part Two: New Federal Rules for Consumer Mortgage Loan Servicing and Loss Mitigation

By Bradley S. Dornish, Esquire

In addition to the new rules for loan applications which went into effect this January, (covered in part one of this article) the Consumer Financial Protection Bureau promulgated a new set of rules governing the servicing of existing consumer mortgage loans by creditors and their mortgage servicers. Some of the changes in these rules affect all mortgage servicers, while others have exemptions for certain small servicers. The changes appear in the Code of Federal Regulations, abbreviated here as C.F.R. The code is available online at eCFR.gov. Many of the changes dictate how servicers must deal with all of their consumer borrowers, while other changes only affect consumer borrowers who are in default. Certain provisions have exemptions for Small Loan Servicers, which are defined as servicers of fewer than 5,000 mortgage loans as of January 1 of the applicable year. We will review the changes affecting all consumers first, and note which provisions exempt small servicers.

A. Periodic Billing Statements and Other Information to be Provided to Borrowers. Mortgage servicers, including both original creditors and assignees, now must give borrowers billing information in writing. Borrowers are entitled to a written mortgage statement each billing cycle, showing what the borrowers owe on the current bill, how it is applied to principal, interest and escrows, payments made since the last billing, and how they were applied, and any transaction activity including fees charged to the account (12 C.F.R.§1026.41). Additionally, this section requires lenders to give borrowers a free copy of all appraisals it obtained on the borrower’s property, contact information for the servicer, and late payment information as well as information on how to contact a housing counselor if the borrowers fall behind on their loan. All of this information must be provided at least three days before loan closing. Note that there is an exemption to these requirements for small loan servicers, and borrowers under fixed rate mortgages may be sent a coupon book with all the same information, instead of monthly statements. 12 C.F.R.§1026.41(e)(3).

B. Interest Rate Adjustments for Adjustable Rate Mortgages. Special new rules for notice apply to adjustable rate mortgages. For the first time an interest rate adjusts under such a loan, the servicer must give notice of the change between 240 days (8 months) and 210 days (7 months) prior to the date the first payment is due after the rate adjusts. 12 C.F.R. § 1026.20(c).Any time an ARM has a rate adjustment resulting in a new payment amount, the servicer must give at least 60 days’ notice to the borrower. 12 C.F.R.§1026.20(d).

C. Prompt Payment Crediting Mortgage Servicers must promptly credit borrowers’ payments. Servicers have to give borrowers credit for their full payments as of the day they are received by the servicer. 12 C.F.R. §1026.36(c)(1). If borrowers pay only part of what they owe, the servicer may hold their partial payment(s) in a special suspense account, but the servicer must tell borrowers about this on their monthly statement. When multiple partial payments add up to a full payment, the servicer has to credit that payment to the borrowers’ account. Mortgage Servicers must also respond quickly when borrowers ask about paying off their loan. See 12 U.S.C. § 2605(k)(1)(C); 12 C.F.R. §1026.36(c)(3). The servicer generally has seven business days after receipt of a written request to provide a complete and accurate pay-off statement. This rule should prove very beneficial to real estate investors waiting for payoff information to close on purchases from owner occupants

Page 3

who have outstanding mortgage loans. Unfortunately, the rule does not apply to commercial loans when investors are selling a property with a mortgage, or buying a property with a non-consumer mortgage loan outstanding.

D. Restrictions on Force Placed Insurance Mortgage Servicers must not charge borrowers for insurance they don’t need, or over-charge borrowers for force-placed insurance. See 12 U.S.C. § 2605(k)(1)(A); see also 12 C.F.R. §1024.37. Servicers must warn borrowers at least 45 days before charging them for a force-placed insurance policy, thus giving borrowers time to buy their own policy. The servicer must then warn borrowers again between 30 days and 15 days before it changes borrowers for such coverage. If the servicer has to purchase force-placed insurance; it can’t over-charge borrowers for it. See 12 U.S.C. § 2605(l)(1)(A)-(C); see also 12 C.F.R. §1024.37. If a borrower provides proof of hazard insurance to the Servicer, it must cancel the force placed insurance and refund any premiums paid for overlapping periods when both policies were in place. 12 C.F.R. §1024.37(g)(1)-(2). The rule also provides that charges related to force placed insurance must be for services actually performed and must bear a reasonable relationship to the servicer’s actual cost of providing such services. 12 C.F.R. §1024.37(h)(1)-(2). Further, when a Servicer maintains an escrow account through which it pays the borrower’s hazard insurance premiums, the servicer is prohibited from obtaining force placed insurance if it can continue the borrower’s homeowners’ coverage, even it that payment exceeds the balance in the escrow account. 12 C.F.R. §1024.37(a). The provisions of this rule are likely to prevent a lot of snowballing defaults when borrowers lose their insurance coverage, and a lot of very expensive bills for force placed insurance.

E. Time Requirements for Response to Error Resolution and Information Requests Mortgage Servicers must quickly resolve complaints and share information. See 12 U.S.C. § 2605(k)(1)(C); 12 C.F.R. §1024.35. When borrowers write to their servicer to ask for information or to complain about certain errors, the servicer generally has five days to acknowledge their letter. 12 C.F.R. §1024.35(d). The servicer then, generally, has 30 to 45 days to fix the error and provide notice of the fix to the borrower or to send borrowers information they requested or investigate and explain why no error occurred or why the information is not available. 12 C.F.R. §1024.35(e).

F. Required General Servicing Policies and Procedures for All Loans Mortgage Servicers must have and follow good customer service policies and procedures. 12 C.F.R. §1024.38. Servicers have to set up their business so they can: access correct information about borrowers’ loan, respond promptly and correctly to borrowers’ problems, pass along correct information about their account when the servicer sells borrowers’ loan servicing to another company, properly evaluate an application for relief if borrowers are having difficulties paying their loan and keep records for at least one year after borrowers pay off their loan (or the loan is transferred). The reasonableness of the servicer’s policies is considered in light of the size, scope and nature of the servicer’s operations. The objectives which the servicing policies are to be designed to achieve include: Accessing and providing accurate and timely information to borrowers, investors and the courts. 12

C.F.R. §1024.38(b); Properly evaluating loss mitigation applications in accordance with eligibility rules established by

investors. 12 C.F.R. §1024.38(b)(2); Continued on page 4

Page 4

Continued from page 3

Facilitating oversight of and compliance by service providers. 12 C.F.R. §1024.38(b)(3); and,

Informing borrowers of the availability of written error resolution information request procedures. 12 C.F.R. §1024.38(b)(5).

Servicers are required by the rule to maintain certain documents and information for each covered mortgage loan in a manner which allows the servicer to compile it into its servicing file within five days. 12 C.F.R. §1024.38(c)(2). There is an exemption for this requirement for small servicers. 12 C.F.R. §1024.30(b).

Beyond the above rules for all consumer loans, the following new rules deal with loans in default, notices, time frames and mitigation procedures. These rules significantly affect the process and time frame for foreclosure of delinquent loans. Therefore, any investor looking to buy properties with delinquent consumer mortgages, “short sale buyers”, and investors who buy at sheriff’s sales should be very familiar with the following rules. Some of these rules should reduce the number of consumer properties going through foreclosure. Others will separate owners who can modify their mortgages and keep their homes from those who can’t. Finally, I believe some of these rules will delay foreclosures. Knowing the above rules can help you to deal with your lender on your home mortgage, and with mortgage lenders on any property you are buying which secures a consumer mortgage.

G. Early Intervention with Delinquent Borrowers Mortgage Servicers must establish or make good faith efforts to establish live contact with borrowers to help them when they’re having trouble making their payments. When a payment is missed, borrowers’ mortgage servicer must try to contact them to talk about the situation no later than 36 days after their payment was due. Where appropriate, contact should also advise that loss mitigation options may be available. The servicer has to give borrowers written notice about mortgage workout options that may be available no later than 45 days after borrowers are late on the payment. See 12 C.F.R. §1024.39.

The servicer must assign personnel to a delinquent borrower and make available to such borrower, via telephone, the assigned personnel to respond to the borrower’s inquiries and assist borrower with available loss mitigation options. See 12 C.F.R. §1024.40. Small servicers are exempt from certain requirements of this rule. 12 C.F.R. §1024.30(b).

H. Continuity of Contact with Delinquent Borrowers Required Servicers must maintain reasonable policies and procedures for its personnel assigned to assist borrowers with loss mitigation options. Policies and procedures must be designed to ensure that a servicer assigns personnel to a delinquent borrower by the time it provides written notice for early intervention, by the borrower’s 45th day of delinquency. 12 C.F.R. §1024.40(a)(1).

Assigned personnel should be available to the borrower by phone to assist in loss mitigation options, including assistance with mitigation applications and timelines. 12 C.F.R. §1024.40(a)(2)-(3). Assigned personnel should also be able to access all of the information provided by the borrower to the servicer and provide that information, when appropriate, to the persons responsible for evaluating the borrower’s eligibility for loss mitigation options. 12 C.F.R. §1024.40(b)(1)-(4). Small servicers are exempt from these requirements. 12 C.F.R. §1024.30(b).

I. Loss Mitigation Procedures Mortgage Servicers must work with borrowers, if they are having trouble paying their mortgage, before starting or continuing foreclosure. To get help, borrowers must tell the servicer they are interested in a loan workout. The servicer will have borrowers submit an application that includes certain information. See 12 C.F.R. §1024.41(a)-(b); 12 U.S.C. §2605(f). Once complete, the servicer has five days to tell borrowers whether it needs more information and, if so, what information it needs. The Servicer must exercise reasonable diligence in obtaining documents and information to complete the application. Within 30 days after the completed application is submitted, as long as the application is received more than 30 days before the foreclosure sale, the servicer has to let borrowers know if there is an option to save their home. See 12 C.F.R. §1024.41(c).

Page 5

Servicers’ personnel must evaluate each borrower for all loss mitigation options available under the investor’s guidelines including options for retention of the home (loan modification) and non-retention options (short sale or deed in lieu). 12 C.F.R. §1024.41(c)(i). The Servicer must provide the borrower with a written decision, including on explanation of the reasons for denying the borrower for any loan modification option offered by the investor. 12 C.F.R. §1024.41(c)(ii). The written explanation must include input used to make a net present value calculation if such input was a basis for denial of modification. See the official comments to 12 C.F.R. §1024.41(d) for more of an explanation.

Borrowers must act fast. Once they’re 120 days behind on their payments, the servicer can start the foreclosure process if borrowers haven’t submitted a complete application. Mortgage Servicers must allow borrowers to seek review of the mortgage servicer’s decision about borrowers’ loan workout request. As long as borrowers sent in their loan workout application at least 90 days before their foreclosure sale, borrowers can seek review of the servicer’s decision and the servicer has to assign the review to someone who was not involved in the initial decision. See 12 C.F.R. §1024.41(h).

The rule further restricts “dual tracking,” where a servicer simultaneously evaluates a borrower for loan modifications or other mitigation alternatives while preparing to complete a foreclosure. The rule also specifically prohibits a servicer from making the first notice or filing required for a foreclosure process until a mortgage loan is more than 120 days delinquent. 12 C.F.R. §1024.41(f)(1)(i)-(iii). By contrast, Pennsylvania law allows the Act 6 and Act 91 notices to be sent when a loan is 2 months overdue, or at 60 days delinquency. 35 P.S. §1680.403(c).

Even if a borrower is over 120 days delinquent and the borrower submits an application for loss mitigation before the servicer has made the first notice or filing required for the foreclosure process, the servicer may not start the foreclosure process unless:

The servicer informs the borrower that the borrower is not eligible for any loss mitigation options (and any appeal of the decision is exhausted). 12 C.F.R. §1024.41(f)(2)(i); or,

The borrower rejects all mitigation offers. 12 C.F.R. §1024.41(f)(2)(ii); or,

a borrower fails to comply with the terms of a loss mitigation option such as a trial modification. 12 C.F.R. §1024.41(f)(iii).

If the borrower submits a complete application for an available loss mitigation option after foreclosure has started but more than 37 days before the sale is scheduled to occur, the servicer may not, until one of the three conditions listed above is met, commence a sale, move for a judgment, obtain an order for sale, or conduct a foreclosure sale 12 C.F.R. §1024.41(g).

It is anticipated that these loss mitigation procedures will significantly slow the residential mortgage foreclosure process in both judicial foreclosure states like Pennsylvania and non-judicial states. However, Pennsylvania counties with foreclosure conciliation programs may consider abandoning those programs if the pre-judicial loss mitigation required by the rule makes the judicial procedures unnecessary. The loss mitigation provisions have only a partial exemption for small servicers. Two loss mitigation requirements remain for small servicers. 12 C.F.R. §1024.41(j);

Small servicers may not make the first notice or filing to commence foreclosure until the borrower is more than 120 days delinquent; and,

Small servicers may not proceed to foreclosure while a borrower is performing under the terms of a loss mitigation agreement.

If this article seems to be more technical and full of citations to the law than my usual articles, it is not your imagination. It is excerpted from materials I wrote for continuing education classes for lawyers on the subject. I taught these classes in Philadelphia, Harrisburg and Pittsburgh between February and May. The rules are complex, so my materials are somewhat complex, but worth learning if you buy distressed consumer mortgaged properties, or if you want to provide mortgage or installment land contract financing to consumers on properties they buy from you.

The author, Bradley S. Dornish is a licensed attorney, title insurance agent and real estate instructor in Pennsylvania. He can be reached at bdornish@dornish.net.

Page 6

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NEW FORMS AVAILABLE The Association has a few new forms available. You can obtain them at the office or on the website:

ADDRESS INFORMATION REQUEST—Take this form to the post office to obtain a forwarding address on a tenant who skipped out.

PRE-RENOVATION FORM—Must be given to tenant to sign before making renovations on a building that was built before 1978.

ADVERSE ACTION NOTICE—Given to an applicant when their application is denied based fully or part-ly on information in their credit report.

MAINTENANCE SERVICE—Filled out by the landlord when a request for service has been submitted by a tenant.

RECEIPT FOR RENTAL DEPOSIT—Paper receipt for a deposit given on a property. If landlord checks out the application and decides not to rent to the prospective tenant, the deposit must be refunded; if the tenant changes their mind, it will be forfeited.

LEASE EXPIRATION AND RENEWAL NOTICE—To be given to tenant prior to the lease expiring, so they can express their interest in renewing or ending the lease.

John P. Dubowski, CPA

Apartment Association Member

INCOME TAX PREPARATION INDIVIDUAL PARTNERSHIP, CORPORATE

(814) 679-9033 9710 Peach St. Waterford, PA 16441

We make evening appointments for busy people.

You’ll feel good about our relationship.

Page 7

NORTH EAST — 14-unit house. Solid brick building on 4 acres.

Retiring and moving South. Asking $260,000. Some trim work

needed and taken into consideration with price. Possible private

1st mortgage financing. Call Joe 814.392.8726 for more info.

FAIRVIEW — Unique 11-unit multi-family residential rental

property in prime location on W. Ridge Rd. Excellent rental

history (many long-term tenants) with stable cash flow. Approx.

2 acres with private drive to newer units (5) in rear (2 have wood

-burning fireplaces and cathedral ceilings). Owner may carry part

of mortgage. Call 814.835.1396.

ERIE — Commercial bldg. - W. 26th and Cascade. 5 Furnished

apartments. 2nd floor. 4 one BD & 1 two BD. Storefront &

tavern 1st floor. $249,900. Call 814.833.4536

ERIE — 2644 Hazel Street - 3 unit apartment. Property consists

of a 2-unit flat and a single family home. Currently 2/3 occupied.

Great income and rental history. Full occupancy $1,525/mo.

$78,000. Call 814.490.3594 (evenings)

ERIE — Prime S.W. Erie corner parcel of land, approximately 3

acres with frontage on W. 34th and Washington Ave. Great

investment opportunity on a one-of-a-kind piece of real estate.

Call 814.866.6736

ERIE — 74 Orchard Street. Two unit unfurnished flat. Each

flat has 2 BD, BA, LR, DR, and Kitchen with refrigerator and

gas stove. W&D hookups. Second floor porch. 1 car garage and

off street parking. $87,500. Call 814.825.8506

ERIE — 2127 Chestnut Street 4-unit income property.

1 bedroom per unit. 100% occupied. $75,000.

Call 814.873.2150 or 727.392.1848

ERIE —Single family house 1320sf. 3BD, 1BA, new roof,

soffit, fascia, gutter, vinyl windows, plumbing, carpet, and

paint. Updated electric & inspected. Good Eastside location.

Move-in ready. $47,500. Call Tom 814.836.5999

ERIE —751 East 7th Street. 2 Unit Flat, each unit has 2 BD,

LR, DR, KIT. Rent is $425 for each apt and both currently are

rented. $34,900. Call 814.450.9991

ERIE — 848 East 28th Street. 2 Unit flat. Each unit has 2 BR,

BA, LR, DR, KIT, Sun porch. Second floor has refrig, gas stove,

new furnace, W & D hook up, off street parking. $59,800.

Call Rita 814.456.7444

ERIE — 115-117 West 24th Street. Two unit unfurnished flat.

Each unit has 2 BD, BA, LR, DR, and KIT with refrig and gas

stove. W&D hookups. Off street parking. 2nd floor has deck

and 2 addl rooms on 3rd floor. Newer roof, windows, siding

(2007) $82,500. Call 814.825.8506

TITUSVILLE —13433 Park East Road. Mobile Home Park.

North of Titusville on Rt 8. 25 lots rented with 5 homes. Park can

expand up to 42 lots. Gross Income $95,000, NOI $40,000. Turn

key business with homes and equipment. $340,000. Check the

Apt Assoc website for more information. Call Tom at

814.923.4399

Page 8

Credentialing Deadline

As you know, each of our members who plan to continue to run credit reports through our organization must be credentialed.

If you did not turn in your application prior to June 1st, 2014, you will need to pay your credentialing fee, turn in all necessary documents, and pass your inspection before we will be able to process any credit reports for you. This will apply to new members as well as existing members. The whole process of being inspected and approved should take about 2 weeks.

The office staff is available to answer any questions that you have to help you understand the process and the documentation that is required. Do not hesitate to call the office at 814.866.7414 with any questions.

SCREENING

APPLICANTS

When interviewing

prospective tenants, here are

some tips:

After you ask a question,

BE SILENT! If they don’t answer,

don’t help them to say something.

They may hate the silence and tell you

something they had not intended to

tell you. Ask open-ended questions.

The key words are who, what, where, why, and how. No question with these

words included in it can be answered

with a yes or no.

Sherwin-Williams is a National REIA—approved supplier of paint and

related products. This alliance results in quality and value with consistent

pricing and substantial savings on the products that you use the most like

the product highlighted below.

Sherwin-Williams is proud to serve residential and commercial

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PAINTER’S EDGE—$12.95 Per Gal

National REIA Price

Page 9

HOW LANDLORDS CAN HAVE A GREAT VACATION (and not worry about their rentals)

www.mrlandlord.com

Are you going on vacation this summer? Do you wish you could, but are afraid

your rental business will explode or fall apart while you're gone?

Many landlords do not go on vacations (especially extended ones), because they don't have any (or effective) systems in place that allow their rental business to run whether they are present or not.

For example, at a minimum, landlords should have systems in place for

1) who (other than you) handles regular maintenance requests or various types of emergency calls.

2) how prospective residents can still see available rentals and apply without you being physically

present.

And even landlords who try and put "back-up" systems in place, the big problem is that these same

landlords only utilize these systems when they try to go on vacation so they never really "test" the

systems under real life conditions. So when the systems are actually tested, sure enough, problems pop

up that have not been fine-tuned. As a result, landlords are now even more unlikely to test the system

again.

I like how one landlord put it: "In order for this (landlord vacations) to work well, I think you need to

practice being on 'fake vacation' virtually all the time..if you only use these backup systems when you

go on vacation, it is unlikely that things will go smoothly."

National REIA Member Benefits

Since our association recently teamed up with National REIA, we wanted to highlight a few of the member benefits that are now available to you. To access most of these benefits, you will need to establish an account on their website, www.nationalreia.com.

• Sherwin Williams—The Apartment Association mailed out a Sherwin-Williams discount card to each member, which you can present in the store to receive discounts on their products.

• Home Depot—You can receive a 2% rebate on your Home Depot purchases (on a minimum of $1,250 in purchases in a 6-mo. period), by filling out the short Home Depot rebate form and turning it into the Apartment Association office. The Home Depot provides in-store special orders, advance order pulling and job site delivery, guaranteed low prices and more for less with Volume Pricing and Bulk Pricing. Please call the Association office for more details.

• Office Max/Office Depot—Receive Office Max and Office Depot discount cards by logging into www.nationalreia.com or pick one up at the Association office. Discounts can be up to 45% off, and will vary by item.

• Avis/Budget Car Rentals—You can receive a discount code for both Avis and Budget rentals by visiting National REIA’s website.

• The National REIA Shipping Program—Members who enroll in this free program receive significant discounts on small package shipments with select FedEx® services. This program also provides discounts of at least 70% on LTL freight shipments arranged through PartnerShip®. In addition, National REIA members save on tradeshow shipments with reputable carriers including UPS Freight, YRC Freight, and more. Call 800-599-2902 or visit PartnerShip.com/73NREIA to sign up for these savings today.

• Local Market Monitor—National REIA members receive 25% off all purchases of Personal Investor Market Reports when they use their National REIA coupon code. Local Market Monitor provides decision tools for residential real estate investors with straight-forward logic and real time information for opportunity analysis. Learn more at http://Investors.LocalMarketMonitor.com.

Page 10

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Legal Encyclopedia for Landlords, Tenant Disputes, National Registered Sex Offenders, Lead Paint Websites,

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Visit us today at

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Page 11

Bathroom Essentials on Move-In Day By Lucas Hall

Out of all the “welcome gifts” that I’ve given to my tenants on move-in days past, the gesture that is often appreciated the most is a package of basic bathroom essentials. Over the last 8 years of managing my rental properties, I’ve tried many things to help get the landlord-tenant relationship off to a great start, including welcome notes, gift cards, local maps of the city. Nothing works as well as toilet paper. Tenants seems to appreciate toilet paper more than anything else. Weird, huh? Not really. More often than not, a tenant’s toiletries will be buried in a box, and they usually don’t realize that a shower liner is not standard issue with an unfurnished rental. Moving day is hard work. Your tenants will be exhausted and stinky. And taking a shower is messy without a curtain liner.

It’s not really about the TP

By providing basic bathroom essentials to help them get through their first week, you are sending the message that you are looking out for them. This is just one step to help you create amazing tenants for yourself. In my opinion, a feeling of being cared for is the best “first impression” a landlord could ever ask for. And better yet, that feeling of safety will be carried forward by your tenant for the remainder of the lease. If you want to go the extra mile, you can include a travel toothbrush and toothpaste, and a $15 gift card to the local pizza delivery restaurant. Your tenants will be happier, and will respect you for it – thus decreasing the chances of late rent, neglect, and poor cleaning habits.

My typical welcome gift ($10)

Toilet Paper – 1 Roll – $2.00 (I like Scott brand because it comes individually wrapped and I can buy a single roll at the grocery store)

Small Bar of Soap (hotel sized) $1.00

Paper Towels – 1 Roll (the grocery store has single rolls) $3.00

A Shower Liner (just the liner, not the curtain) – $4.00.

OfficeMax Discount Card

Members, here is your OfficeMax discount card which is available to you through our membership in National REIA. In next month’s newsletter, you will find a discount card for Office Depot, or you can download it via our website, www.aptassoc.com in the “Downloads” section or you may pick up a copy in the Association office.

Page 12

WELCOME NEW MEMBERS

Ann Folmar • Mike & Brenda Kobylka Erin and Andrew Duran • Kaile Taylor

Ray Family Rentals, LLC • Jeffrey Bucci Dianne and Donald Shriver

Daniel Black • Deborah Atkin

We look forward to seeing each of you at our meetings and hope you will make many new friends. Please take advantage of the networking

opportunities before & after the meetings. You may learn something or teach something to someone.

Coldwell Banker Select, Realtors Commercial Division 814-833-3331

REDUCED—1319 W. 10th ST.—Great income property close to schools, hospitals,

park and Bayfront Parkway. 4 nice size bedrooms. Updated with newer kitchen, bath,

furnace & hot water tank. Plenty of parking in rear of home. 33671. $75,000. Bob

Pfister, 218-9703.

3205 FRENCH ST.—2 unit on double lot. Walking distance to VA hospital &

Mercyhurst U. Long term tenants. Separate utilities. 4 car garage w/ separate bays

provides extra income @$50/mo/unit. 37615. $84,900. Tom Torti, 450-4041.

75 TOWNHALL RD.—Nice duplex on 2.72 acres. Each unit has 1,344 SF. 3 BR and

an integral garage. Property runs to Route 97 on east boundary. 39247. Larry Obert,

572-1138.

1011 WASHINGTON PL.—Well maintained solid brick flat. Each with 3 BR, hard-

wood floors. Newer roof, updated electric, vinyl windows, separate utilities. 1.5 car

garage. 39020. $109,900. Timothy DeCapua, 323-4102.

9921 WEST RIDGE RD.—Whispering Pines Mobile Home Park. 19 mobile homes

plus 1-2 BR apartments. Potential yearly income of $171,000 plus. Nearly 4 acres of

land with community water/septic. 39342. $495,000. Timothy DeCapua, 323-4102.

Credit Score Now

Available

You will now receive a FICO credit score with each credit report that is run through the apartment association. This will increase the price of each credit report by $1.00 Therefore, the price of an individual credit report and Pennsylvania landlord/tenant court check will now be $11.00, and the individual package (including a Pennsylvania criminal check) will be $13.00. Don’t forget to make the appropriate changes in your application fee to accommodate the price change.

LANDLORDS, BE DISCREET

Landlords, remember, the information that you receive from our office is for your eyes only, and is not to be passed along to the

tenant. If a tenant doesn’t meet your criteria because of the credit report that you received from our office, you CANNOT give them

the credit report, but you can give them the 800 number at the end of the report. They can call that number and get a free copy of

their report because they were rejected as a result of their credit. Please do not tell them that the Apartment Association won’t let

you rent to them or to call our office.

Don’t Forget to Take Advantage of the PROA Answer Line!

This is an online discussion forum available exclusively to PROA members. Members can post questions, obtain answers, discuss issues, learn from each other, and obtain information relating to real estate investment and property management. The forum is organized into major subject categories and topics. Members can post questions or add to discussions under each topic. Experts regularly visit the forum to respond to questions and moderate discussions. New subject categories and topics can easily be added as needed. A secure e-mail and private messaging system is also available for members to communicate with each other.

Call the Apartment Association office to receive your PROA ID and begin using the Answer Line.

This publication is designed to provide informative material of interest to its readers. It is distributed with the

understanding that it does not constitute legal, accounting, or other professional advice. Although the published

material is intended to be accurate, neither we nor any other party will assume liability for loss or damage as a result

of reliance on this material. Appropriate legal or accounting advice or other expert assistance should be sought from a

competent professional.

Page 13

Help Prevent Fraud

Request to see the applicant's

social security card and drivers

license for positive

identification. Take a picture of

both with your smart phone and

email them to yourself

for your files.

DO WE HAVE YOUR

CURRENT E-MAIL ADDRESS?

If you have changed your e-mail

address, don’t forget to notify the

Apartment Association office.

This will avoid any disruption in

service for downloading your

forms or advertising your rental

units on our website. Also, we

may need to contact our members

via e-mail regarding upcoming

meetings and legislative issues.

You can call us at 814-866-7414 or

email us at office@aptassoc.com

with any changes.

HAVE YOU ATTENDED A DINNER MEETING

LATELY?

Come early — Stay late!

It is your best opportunity to network with other landlords.

Everyone has questions. This is where you get them

answered!

FELLOW LANDLORDS:

Earn Significant Income

Helping Others SAVE MONEY

On Their Home Utilities

www.PA.Energy401k.com

(5 minute video)

Still need more info?

http://Landlord.WhyAmbitWorks.com

Not interested in your own business

but want to save on energy cost?

www.PleaseLowerMyEnergyCost.com

Ron Irwin 814-425-8340

ronirwin@windstream.net

VIDEO RECORDING AND PICTURES CAN REDUCE DISPUTES

Pictures speak a thousand words!

Reduce disputes with tenants by video recording or photographing the unit’s condition before move-in

and after move-out. If you do this when the unit is vacant, the tenant cannot claim his or her privacy

was invaded. When move-out is completed, repeat the process again and obtain evidence of any

damage that occurred during the occupancy of the affected tenant.

Page 14

The National Real Estate Investors Association teamed up with The Home Depot to offer all of

its members a Material Purchase Rebate Incentive Program. This Program is available to all

members and offers unbeatable Volume Pricing. This amazing benefit is designed to offer real

estate investors and contractors the lowest price possible on job lot quantities. In most cases, a

minimum order threshold of only $2,500 is required. Currently, the average savings through

volume pricing exceeds 10% nationwide.

Simple quotes can be returned within 24-48 hours and Contractor Services associates can help

you compile and submit your bids. The Home Depot now also provides National REIA

members commercial credit/financing services, direct to jobsite delivery and ‘will call’ pick-up

options! Whatever you’re looking for—lumber, building supplies, plumbing, electrical or

hardware items—your order of $2,500 or more may be eligible for volume pricing.

WHAT ARE YOU WAITING FOR?

SUBMIT YOUR QUOTE AT THE PRO BID ROOM TODAY!

Page 15

ATTENTION MEMBERS You may want to add some of these clauses to your lease.

Municipal Rental Fees Clause: Tenant shall reimburse Landlord for any municipal service

fee, special assessment, inspection fee, license fee, rental

permit fee, or special tax levied upon the rental unit which

must be paid to permit its use as a residential rental. Tenant

shall be responsible for such fees and taxes whether they are

in effect at the start of this lease, or if they become effective

during the Lease term. The amount due shall be considered as

additional rent, and must be paid within 10 days of billing by

the Landlord.

Inflation Clause: Any fees, taxes, or other charges enacted, assessed or

increased by any agency, business or utility that do not

exist at the signing of this lease shall be passed onto the

tenant as additional rent and due on demand.

Plumbing Clause:

No grease, coffee grounds, sanitary napkins, or smoking

materials in drains or toilets. Plumbing repairs

necessitated by resident carelessness or neglect shall be at

the expense of the resident.

Don’t forget that every property that was built prior to

1978 MUST disclose that it may contain lead paint.

Every new tenant must be given the lead paint booklet

and must sign the lead disclosure form. That’s the

law! You must keep your signed lead disclosure forms and leases for a minimum of 5 years. You can purchase these forms

at the office or download them from our web site.

Landlords of the Apartment Association will comply with

all provisions of the (Fair Credit Reporting Act). The

information that is requested is for the landlord’s exclusive use.

The landlord certifies that inquiries will be made ONLY for

permissible purpose, namely: in connection with credit

transaction involving the extension of credit to, or review of

collection of an account of the consumer. The law prohibits

the landlord from providing a copy of the report to the

applicant. Landlords are FORBIDDEN to obtain reports on

themselves, associates, or any other person except in the

exercise of their official duties. Any person who knowingly

and willingly obtains information on a consumer from a

consumer reporting agency under false pretenses shall be fined

$5,000 or imprisoned not more than one year or both.

CREDIT REPORTING PROCEDURES

When obtaining a credit report on an individual, you must

have a signed Apartment Association Rental Application with

the following information:

First & Last Name

Current address; including street with number, city, state and

ZIP CODE

Previous address; if above address is less than 1 year

Social Security Number

Date of Birth

Signature giving permission to run their report

When a credit report is run in our office, we will

automatically check to see if a Landlord/Tenant complaint has

been filed in PA on that person at no additional cost to you. If

you prefer only a Landlord/Tenant Complaint check and no

credit report, then there is a charge for the L/T check.

Funds may be placed on account in order for you to run

credit reports. This will allow you to fax or scan and email the

rental application to the office and it will be returned to you by

fax or email. The office fax number is 814-866-2732 and our

email address is office@aptassoc.com.

EVICTION SCHEDULE UNDER ACT 36

This schedule is for the best case scenario, if using the

Apartment Association lease or a lease that allows a 5

-day notice

Day (1) Rental payment due

Day (2) For unpaid rent must give a 5 day notice

Day (8) File landlord/tenant complaint at District Justice

Office

Day (15) Scheduled hearing to take place and judgment

given. A decision must be given within 3 days of hearing

Day (26) Order of Possession can be requested 11th day after

judgment. The Order of Possession must be served within 48

hours

Day (39) The eviction takes place around the 11th day after

service of the Order of Possession.

FOR YOUR CONVENIENCE…

Credit reports can be ordered by any member that has money on

account or wishes to use a credit card. Simply mail, fax or email

the signed rental application to the office. It will be completed

and returned per your request. Forms may also be ordered by

telephone, fax, or mail if the member has money on account or

wishes to use credit card. Postage will be added to the cost for

any mailings to a member.

HARD COPIES

Warning: All credit reports on accepted and rejected tenant

applications should be saved for at least five years. It is

imperative that owners request hard copies of credit reports.

Credit reports can change daily, and there will never be another

report exactly the same as the one the owner ran to determine

acceptance of a tenant. Without a hard copy, the owner cannot

prove the financial reasons for acceptance or rejection if

challenged in court.

1127 West 38th Street

Erie, PA 16508

Address Service Requested

Would YOU Like to be a Part of the Working

Apartment Association Board?

It is time for our members to start thinking about the Board of Directors election coming up in September.

This year the Directors that are up for re-election are: Lewis Baldwin; Dorothy Butala; Joanne Hulick; Dan

Omniewski; Jason Pero and Jerry Ricci. We would also ask you to consider running for office. It doesn’t

matter if you have had long-term experience in being a landlord and would bring some valuable insight to

the board or if you have been a landlord for a short time and have some fresh new ideas. We have always

been fortunate in the past with the dedication and loyalty of our board members, and trust that we can

continue recruiting that same quality of individual. Are you interested? If you are, please submit your

letter of intent along with a resume to The Apartment Association C/O Nomination Committee, 1127 West

38th Street, Erie, PA 16508. All letters and resumes must be received in our office on or before August 31,

2014. An applicant must be an Association member for at least one year, and Directors serve for a 3-year

term. Please consider running for office. We understand that this is a time commitment on your part, but

there is so much that can be done if we all work together. Is it time for YOU to get involved? Is it time to

give back? There are currently so many issues facing landlords and so many things changing. It is only by

working together that we will effect change.

We Hope

To Hear

From YOU!

YOU Can

Make A

Difference!