Invalid transaction dates within your ledgers can cause the balance of the individual ledger along with the overall owner balance to be incorrect.  Most reports within the Tenant File are created by entering a date range.  The ledgers, however, take into account all transactions posted within the ledger even if the date was entered incorrectly.  For example, if while entering a transaction with a transaction date of 01/01/2018, incorrect data was entered making the ‘date field’ display a date of 01/01/2001, that entry would re-sort in the ledger grid and you may not see the entry yet the balance would be affected.

If you feel that an individual ledger or Owner balance is incorrect, one thing to check would be to see if there were invalid transaction dates entered in your system.  Within the program, there is an easy way to view a report showing all transactions by date.   This report, called the ‘Trust Report’, can be viewed by clicking into REPORTS > GENERAL REPORTS > TRUST REPORT > Enter a date range and click to ‘Print’ the report to screen.    If, for example, you completed a ‘Year End Closing’  through the end of 2017 and you only have transactions showing for 2018, you may choose to create a ‘Trust Report’ with a ‘Starting Date’ of 01/01/0100 and an ending date of 12/31/2017 to determine if by chance there are entries entered prior to 2018.

A few things to note…

If you have transactions in the system prior to the year 1900 by mistake, those transactions will affect the balance but will not show up on your screen.  That is why we suggest that the Starting Date on the report be entered as 01/01/0100.

If you are creating this report, please note that the information will include all transactions within the given date range.  We suggest that you display the report to screen rather than directly to the printer to prevent a large number of pages to be printed.

If you find that you have transactions in your system with dates that were incorrectly entered, you would need to print that portion of the report and correct your entries.  If the dates are prior to the year 1900, you would need to run the Database Maintenance procedure found under FILE > DATABASE MAINTENANCE > CHECK FOR LINK PROBLEMS.

As always, prior to making any major changes to your ledgers, we highly suggest that you make a backup of your main database file called ‘TFDATAFL.MDB’.

Thank you!

Our first tip is of course to remind our users to BACKUP, BACKUP, BACKUP.   Most of the following information can also be found in the Tenant File online Use’s Guider (found under HELP > USER’S GUIDE from your Main Menu).  We highly suggest that you create multiple folders on your external drive, flash drive, memory stick, etc. (even if you also backup to your hard drive).

As shown on the example below, if you plan on backing up once a week, you would name the folders ‘Week 1’, ‘Week 2’, ‘Week 3’, Week 4 and ‘Week 5’.  It is very important that you always alternate the folders when you run the Backup procedure so that you do not over-write your last backup.

The Tenant File has a simple ‘Copy’ and ‘Restore’ feature for basic file copy to a CD, DVD, another drive, hard disk or network computer. This feature is intended to be a supplement to a full-featured backup system, which usually comes with Windows.

However, the Tenant File can quickly copy your data files, explains what each file contains, and is recommended as a routine backup. Your computer must be enabled for DLA (drive letter access), which lets you copy from a file to a lettered drive.

To access the feature to backup your database files (files that end with ‘.mdb’) and your data files (files that end with ‘.dat’), click onto the BACKUPS button from the Main Menu.  Once you are on the Backups screen, click on a file to see a description of the file and the file size, so you can be sure there is enough room on the destination location.

Choose Action – To copy files to another location, choose ‘Copy file(s) TO’. If you have already made a previous copy and wish to restore to your current program, choose ‘Restore file(s) FROM’. Be VERY careful ‘Restoring’ files, since this will OVERWRITE your existing Tenant File information! A better choice to see your old data would be to install the Tenant File on a different computer and restore the information into that installation instead.

Copy to (or Restore from) Drive/Folder – To copy your database files TO another location (Backing up), this will select the location that you are copying ‘TO’. If you are copying FROM another location (Restoring), this will select the location that you are copying ‘FROM’.

Copy What Type – Choose either database files (MDB) or data files (DAT). The three main database files that contain all of your data are: FEATURES.MDB (which contains information on each unit, such as interior, exterior, etc.), TFDATAOF.MDB (your inactive files), and TFDATAFL.MDB (the MAIN database with the majority of all information). All of the files that end with the DAT extension contain information such as report settings, company information, and other important data.

To begin the ‘Copy’ function, simply highlight the files of your choice under ‘Choose Files to COPY’, select ‘Copy File(s) TO’  under ‘Choose Action’, select either ‘Database Files (.mdb)’ or ‘Data Files (.dat) under ‘Copy What Type of Files’, select the drive or folder that you want to copy to under ‘Copy to’ Drive/Folder’ and select the button ‘Start Copy/Restore NOW’.  The program will default to your current drive so you must ALWAYS change the location to a different drive or folder to copy to.  The selection under ‘Choose files to COPY’  is dependent upon whether you want to copy the ‘Database Files’ or the ‘Data Files’.  These two must be done separately.

How often do you want to be reminded to backup?  This option will keep a record of your last backup and let you know when it is time to backup your files. We recommend that you use this option to backup at least once a week. We also suggest that you set up separate weekly and monthly folders for your backups so that you don’t always overwrite your last backup with a new backup. (If you database corrupts, you might accidentally overwrite your last good backup!)

Be very careful with the process of ‘Copying files to’ and ‘Restoring files from’ because this action is non-reversible. 

Caution: If you are on a network, do not attempt to copy or restore files while other users are in the Tenant File.   It will cause your database to become corrupted.  Make sure ALL users have closed the program before continuing.

There are many ways that people get into rental property. Maybe you are an investor looking for a great way to have recurring income while building equity. Or possibly you were caught in the housing crisis a decade ago and decided to rent because you couldn’t sell. Others may have decided to downsize and rent to provide extra income.

Why not? Right now, interest rates are low and the stock market is doing well. So, maybe it is the right time for you to consider purchasing a rental property to provide great income for you in the future. In fact, many are doing just that, and the rental market is rising while home ownership is falling.

Now there are even more avenues to own rental property. Because of Airbnb and other vacation or travel rental services, you can rent all or part of your own house. With these opportunities come risks that you should be aware of. By taking on short term rentals, you are creating a new business, and you are also accepting the liabilities.

In any case, many landlords assume that their homeowner’s insurance will cover their rental property. That assumption could end up being very costly. Your insurance could completely deny your claim if they determine that you are acting as a landlord and didn’t switch to landlord coverage. However, we have put together the information that a landlord needs to know about getting landlord rental insurance for a rental property.

Getting Started: Finding a Good Policy

You should call your insurance company that provides your homeowner’s insurance, but be aware they may not even cover insurance on rental property. Some insurance companies see rental property as a higher risk, so you can expect a higher rate if they cover your property at all. The designated use of your property may change from personal use to commercial use, which involves an entirely different set of costs and liabilities.

This is especially true if you are still keeping your existing homeowner’s policy and renting out your home. You’ll need to read the fine print of the policy. You may find that your policy will not cover damages or losses if the property is not occupied by the owner, as in the case of long or short term tenants.

There may also be limitations to the length of time the property is rented. Some H/O policies may cover non-owner stays, but only up to a pre-set number of weeks. Others may require that you notify the insurance company if it is not going to be owner occupied for a while in order to cover the occupants.

Lastly, there may be limitations on the number of people that are considered ‘renters’. One policy that we looked at would only cover an owner occupied home with 2 additional renters. If you are constantly renting a property out to different tenants, it might be considered a vacation home business, and you could be required to have a license to do business in your city. Not having the proper license could affect the coverage on your insurance policy.

What about AirBnb and the other short term rental companies?

Yes, AirBnb now includes protection for you as a landlord, and right now that is just part of the arrangement, meaning no cost to you. That includes insurance for your renters getting accidentally injured on your property, but generally does not cover things they steal from your home.

HomeAway also offers insurance protection, but there is an extra cost for that. It covers damages to your property up to 5k with no deductible at the time of this writing.

Personally, I would not recommend depending on this coverage alone. There could be delays in getting paid if there are conflicting claims and you would have more piece of mind if you had a solid landlord insurance plan.

What is different about landlord policies?

Typically, landlord policies (or dwelling policies) are available in three different options:

1. The least expensive type is DP-1. It covers only basic risks. Most likely, those would include theft and vandalism of the property. Typically this type of policy covers ‘actual cash value’, not ‘replacement value’. More on this later.
2. The DP-2 policy adds more coverage, to include such things as windstorm damage, vandalism or fire. These are ‘named perils’ so you need to carefully determine what is ‘not’ mentioned as being covered.
3. The most expensive and most comprehensive type of policy is the DP-3 policy, which covers all perils unless the policy expressly states that it is not covered. This is the closest to a good homeowner’s policy and most often covers full replacement costs.

Note: Be careful that you understand the differences in replacement or cash value, because it can have a big impact on you financially. A policy that only pays out ‘cash value’ will take the depreciated value into consideration, not the actual amount that you have to pay to replace the property or repair the damage.

One additional thing to consider is that your expenses for a landlord policy are most likely tax deductible, so check with your accountant and take advantage of it.

What about the rental income that I’m losing during a claim?

Just like having a vacant property, you might end up with an uninhabitable property. But your mortgage payments are still due, so it is a good idea to be covered for loss of rental income as well. This is a worthwhile insurance investment and might not raise the price as much as you would think.

What can I add on to the policy?

Of course, you can also protect other things. The most important thing is probably liability if your tenant gets injured. You could be accused of being responsible for that injury, and without liability coverage, you could be financially ruined. As a landlord, you also need to take your own initiative to make sure that your property is safe for the tenant. Be sure that everything is in compliance with the building codes, in good condition, and that you attend to maintenance issues promptly.

You might have other structures on your rental property, such as sheds, separate garages, or workshops. Be sure that your policy includes these as part of the main policy or additions to it.

Consider if you have other large equipment that is kept at the rental, such as hot tubs, riding lawn mowers, snow blowers, tillers, or tools. It is a good idea to cover these items under ‘personal property’ at the rental. Also, be sure that you don’t leave the keys around for the tenants to use the equipment unless you are absolutely sure that you are protected against any accidents they may have.

If your property is damaged, you may have to cope with ever-changing building code compliance. For a small extra fee, you can be covered for the cost of having to add additional ventilation, electrical wiring or other safety related items.

What is generally excluded?

Sometimes you may find that renting out ‘part’ of your owner-occupied home cannot be covered with a landlord policy. However, as mentioned previously, you may still be able to get coverage from the rental service.

Your tenant’s possessions are generally not covered, which is why you should require long term tenants to have renter’s insurance. That will cover their own possessions and possibly protect them from liability if one their guests get hurt in their rental. If the tenants are using your own furniture, you should consider getting additional insurance coverage that will cover your carpets and furniture in case of damage.

Wear and tear and maintenance issues are generally not covered. This would include such things as A/C units, heaters, dishwashers, disposals, refrigerators, and the like. So make sure that your tenants take good care of these items, and that they are instructed as to their proper care and operation.

Flood coverage, like your homeowner’s policy is generally going to be a rider on your policy. While the basic policy may cover the damage from damaged water heaters and broken pipes, they won’t cover damage from natural disasters (think hurricanes, tornadoes and earthquakes), flooding, and sewage backups. You’ll have to add that on. This is especially true if your rental is in a flood plain, you should have flood coverage, but there are still good reasons to have it even if you are not.

Vacant property may not be covered if it has been vacant for a certain period of time. Be sure to check this item on your policy, because it might affect if a claim will be paid on a vacant rental property.

This all sounds very expensive to get proper coverage …

Well, yes, it is more expensive, but a necessary evil. According to recent data, a good landlord insurance policy can cost 15 – 30 percent more than a similar homeowner’s policy.        The insurance companies see renters as being riskier than owners of a property which have more of a vested interest in taking good care of the property. You can alter the coverage amounts to save money, such as the cap on liability coverage or medical coverage.

Your costs for insurance a determined by a number of factors, such as the ones here:

• The proximity to areas that are prone to natural disasters, such as the coasts for hurricanes, the tornado prone areas, and areas that are in danger of loss from forest fires.
• The amount of crime that is committed in your area. If the crime rate is high (think break-ins, assaults, and vandalism) you can logically expect to pay a higher rate than a rental home in a senior living area.
• The construction of the home. Like all insurance policies, homes that are more susceptible to fire, animal or insect damage will cost more to insure.
• The proximity to emergency services and items like nearby fire hydrants. Of course, a very rural area might be in greater danger from fire or flood if the emergency services cannot get to it quickly.
• The square footage of your rental property and other structures that the tenants have access to.
• The age and condition of your property will affect your rate. Even if the property is newer, you can pay more if it is run-down.
• Safety devices, such as indoor sprinkler systems and fire alarms will reduce the cost of your policy, so don’t forget to mention those things.
• If you require your tenants to follow safety rules, such as no smoking or limits to the number and duration of guests, it could help reduce the costs of your landlord policy.
• If you have a pool or hot tub, it will increase the cost of the policy. You have additional liability needs if you provide such items to your tenants.
• And of course, if you have additional rentals, or if you have coverage with the same company for auto, boat, or health, you can get a discount.

The bottom line

If you are renting out an entire home or have renters in and out of even a partial property, you definitely need to have landlord insurance. Homeowner’s insurance doesn’t cover your needs as a landlord, and you might even find out that your claim is denied because you were running a business without switching to landlord coverage. The pricing is flexible depending on the factors listed in this article, and the amount of premium vs. deductible that you are willing to pay.

We hope this article has been informative for you. We have a lot more advice for landlords and property managers in our eBook “What ALL Landlords REALLY Need to KNOW”, so please get a copy.

About the author:

Wayne Gathright has over 20 years experience in the rental property industry as a software developer, consultant, author, and mentor. He’s working with thousands of property managers and tenants, helping to formulate a better understanding of how to create and maintain better relationships between landlords and renters.

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We’ve had an overwhelming response by property managers wanting to make sure their tenants are covered with renters insurance!

Now, we’d like to provide you with a sample letter that you can use (or edit) in a mailout:

Dear Residents, 

One of the requirements of your lease is that you must maintain personal liability insurance. The most common way to do this is with a renters insurance policy.

The landlord is not responsible for any damages to your personal property arising from fires, leaks, and other unforeseen events. A renters insurance policy generally will include personal property coverage to protect your belongings. This is an important component of your lease and failure to maintain the required coverage will be consider

ed a breach of the lease and is subject to any and all legal remedies.

If you do not have coverage, please reach out to an insurance provider or visit tenantfile.sureapp.com to get covered. The process is quick and hassle-free.

Sincerely,
Management

* Remember, you can send this email out through the Tenant File Program under the ‘Miscellaneous > Easy Email’ selection.

YOUR TENANTS PAY AS LITTLE AS $9.00 PER MONTH

For more information, click here

* Renters Insurance is covered through a partnership with Sure. With Sure and their wide partner network including Nationwide, landlords and property managers can provide their tenants with a way to get comprehensive coverage from vetted, reliable partners at the best price — all in one, easy-to-use online app for computers,  iPhone and Android devices.

Questions? Call us at 1-800-398-3904