MOD Properties will be referred to as MOD throughout this owner's handbook.
This handbook offers owners greater insight into the details of our procedures. The content is to be kept confidential, as is agreed to in the management agreement. If a conflict between the two documents occurs, the management agreement will control.
MOD offers the following guarantees:
Tenant Placement: If a tenant placed by MOD breaks their lease, the next new lease charge will be waived. This doesn’t apply to tenants the owner approves with conditions, even if those conditions are suggested and recommended
by MOD. This guarantee will not apply if MOD is successfully able to collect sufficient funds to pay the new lease charge from the tenants via payment of a lease break fee, improper termination fee, other payment, or unused security deposit.
Performance: We guarantee your satisfaction. If at any time you aren’t satisfied with us you can cancel with no penalty and minimal notice. 24 hours notice required if the property is not leased and without a pending
rental application and a 30 day notice at all other times.
Communication: Email/Call/Text-We will be easy to get in touch with. We won’t hide behind a “24 hour response time” or screen your calls.
Maintenance: MOD is proud of the work completed by our technicians and we stand behind it, 100%, for a period of 12 months. We guarantee the work to be high quality and completed in a timely and safe manner. We will return to complete
any repair that doesn’t meet these standards at no cost to you.
Tenant Retention: If a tenant doesn’t renew because of complaints about the service received by MOD, then the next new lease charge will be waived.
Optional eviction protection:
If you are enrolled in eviction protection we will not require any funds up front to initiate eviction. We will also cover the attorney fees, court costs and sheriff department fees for executing the eviction.
If you are not enrolled then we will request $750 up-front to cover potential costs. This $750 would be a budget only and if actual costs are less the excess would be returned. If costs exceed this budget the owner would need to contribute additional funds.
MOD will provide recommendations on property improvements and their impacts on rental value. MOD will also provide analysis and recommendations on rental value for a property prior to placement on the rental market and at consideration of a lease renewal.
MOD begins the renewal process with a survey to the tenant and will then reach out to the owner approximately 100-120 days before a lease expiration. Owners will approve final pricing of renewals and MOD will provide a copy of current lease language prior to executing a renewal. MOD may require tenants to sign a completely new lease at a lease renewal.
MOD may require all tenants to sign a lead paint disclosure (regardless of the property’s year of construction) and The State of CO required tenant disclosure.
For single unit properties MOD leases only the entire property and doesn’t allow restricted areas such as basements, mechanical rooms, storage rooms, garages, sheds or similar to be locked off or excluded. Owner storage of personal items on-site is at their risk and MOD will not inventory such items or track their continued existence on the property. The owner should remove all personal property from the unit.
The advertised Security Deposit will be held as an amount refundable to the tenants at move-out. MOD offers residents a deposit alternative unless the owner requests to opt-out. Information on this is provided before marketing a vacancy or renewing a lease.
MOD will require tenant participation in a resident benefit package for new leases. This package is designed to provide better tenant compliance with filter changes, better tenant relations via more forgiving policies and easier access to the property. This package will have a cost that varies between $25 and $40 per month. It will include HVAC filter delivery, tenant reporting to credit bureau, 24/7 emergency response, access to a tenant portal and app, late fee forgiveness, waived damage or missed appointment fees, installation of an electronic lockbox for mod/vendor use and electronic lease signing. MOD Properties will bear all expenses associated with performance of services required under this package and retain all fees charged to the tenant. 24/7 emergency response includes access to our rotating on call staff member. The owner is still responsible for actual repair work needed after hours. For certain properties where furnace filters are in crawlspaces, attics, systems with multiple filters or without a filter box MOD will replace the filters based on the specific needs of the property. MOD will charge the owner a discounted labor rate for filter changes with no charge to the owner for the filter cost. For a waiver of a damage or missed appointment fees MOD will reimburse the owner for costs tenants are responsible for.
MOD will inspect properties in preparation for an upcoming vacancy. Typically inspections are completed within 5 days of receipt and processing of a tenant’s notice to vacate. The inspection is done to evaluate the condition, evaluate and bid needed work as applicable and re-affirm the property’s rental value. MOD will also provide information on a timeline, our rental criteria, current lease language and minimum condition standards prior to advertising. The owner will approve the initial price/terms and price/term changes. No final owner approval is sought if an applicant meets our written criteria and MOD will execute a completed version of the lease for approved applicants.
MOD will provide an overview of typical costs expected during preparation of a property for a new tenant for owner to use when budgeting. This is not an exact estimate, bid or agreement that eventual expenses will match this original overview. MOD will employ multiple strategies and practices in order to facilitate the transition from one tenant to another in such a way that owner net income is highest. MOD may engage tactics that are not necessarily the cheapest in pursuit of reduced vacancy, and time may not always allow for determination of exact costs and subsequent approval. For example: during a walk through while the property is occupied and furnished, the need for typical drywall repair and painting in high traffic areas is observed which costs would fall in line with the overview provided. The property re-rents with the new tenant moving in 4 days after the old tenant moves out. During the initial move out walk through it is found that additional painting is needed in order to present a property where the condition matches the value presented during the marketing and in keeping with the condition of the other parts of the property. The additional painting is ordered to be completed on a time and material basis within the 4 days so as not to delay the move in. Delaying the move in reduces rent and only potentially saves money through a competitive bid process. The potential savings do not outweigh the lost rent and in this way funds are being used to improve and maintain the property vs being a total loss with vacancy resulting in lost revenue. These efforts are completed as best practice to preserve the property condition and maintain the highest net income possible.
The following terms will routinely be used when referencing maintenance items:
Budget-This is not a bid or estimate, rather a rough number to be used for planning and to ensure awareness of approximate potential costs. An example of this would be the budget prepared before an upcoming tenant changeover.
Budgets may also be used in circumstances where a larger job is being considered and it is helpful for both parties to be on the same page with what a job might be expected to typically cost.
Bid (also commonly referred to as an estimate, but we prefer “bid” over “estimate”)-This is an exact dollar amount that has been agreed upon to perform a specific task, or tasks. An example of this would be flooring replacement.
Once lease terms are finalized MOD will advertise units online via software syndication services to a vast network of sites. This includes Zillow and it’s partner sites. MOD covers the cost of posting to Zillow. MOD doesn't manually post listings to individual sites and doesn’t use craisglist.com or perform additional advertising, and the owner agrees not to post it’s own ads, or copies of MOD ad content, to other sites. Ads will include photos taken with a wide angle camera, a floorplan, and 3D tour. Not all marketing sites support each of these marketing tools. A yard sign will be placed once ads are published.
MOD will show properties during daylight hours based on availability, and utilizes a 3rd party application for basic preliminary screening and to schedule showings. MOD may install a lockbox to access the property and may provide an electronic lockbox for self-access showings with owner approval. Otherwise, showings are performed in person via appointment or, if requested, via the prospect’s preferred virtual contact method. Open houses are not offered and MOD may limit the total number of trips to the property per day and pause showings when applications are being processed. MOD will follow up with prospects after a showing and update all prospects when significant changes are made to price or terms.
The owner will receive a leasing progress update weekly on/after Tuesday afternoon. MOD will provide an analysis of lead volume and showing feedback to provide any required suggestions for changes to price or terms. All pricing and term changes will require written owner approval. For an applicant who does not fully meet our criteria, or an applicant requesting substantially different terms than those advertised, owner approval will be required. Applicant information which reveals specifics about an applicant related to a protected class will be withheld. MOD does not intentionally collect such information, and often doesn’t have such information available, in order to promote Fair Housing standards. The owner will be updated as an approved applicant executes a lease and pays the deposit, and again once the move-in is successfully completed.
During preparation for a new tenant, MOD will order work to ensure the property meets minimum condition and safety standards. These are outlined in our turn checklist which is presented prior to marketing the property. These minimum standards are important for preserving property value and reducing liability. The costs associated remain the responsibility of the owner. These standards will include the expectation that properties are exceptionally clean and receive a final touch up clean before move-in. Mod will order cleaning between tenants and in preparation for a first tenant at a property.
Locks will be re-keyed between tenants and at the start of management. MOD aims to have as few different types of keys and locks as possible. MOD shall have discretion as to whether locks are changed or replaced to accomplish this. Mailbox keys do not have to be re-keyed between tenants but a mail key must be provided. All exterior doors are required to have a minimum of one working deadbolt. All garage openers, keypads, key overrides and emergency release keys must be operational. Interior door locks preventing access from the exterior with the use of a key are not permitted. A sufficient number of copies of all keys and key fobs will be obtained to allow for an appropriate number of tenant use and MOD use copies. Double cylinder deadbolts are removed and replaced with a standard deadbolt.
MOD doesn’t access properties with an alarm that is monitored. Alarms will need to be disabled by the property owner to allow MOD access.
Photos and video of the property condition will be taken immediately after move-out and immediately before move-in. In some cases, it may not be possible to acquire move-in photos, or they may not depict the final condition prior to move-in. In the event this happens we will have receipts to document work completed and final condition.
MOD will verify tenant insurance, tenant set up of utility service and coordinate move-in details, including required documentation with the HOA if applicable. Mod may use a 3rd party service to coordinate utilities and may receive income from the 3rd party service.
MOD will perform routine maintenance inspections based on the agreed upon frequency. Additional inspections for follow-up on issues may also be performed as well as drive-by and exterior inspections.
MOD will notify the owner, in order that they may prepare for fluctuations in cash flow, upon receipt of notification from the tenant that repairs are needed and have been ordered. Should the repair issue require more than basic repair/service calls,
MOD Properties will notify the owner and discuss possible repair/replacement alternatives, if available. MOD will also assist the property owner in obtaining, as requested, various estimates for property repairs and improvements.
MOD does not send rent invoices or notify the owner of receipt of the rent payment each month. MOD will invoice for late fees at its discretion and promptly post an eviction notice if a tenant has not paid rent or we don’t have reason to believe
they will shortly after the due date. The owner will be notified prior to the filing of an eviction and incurring attorney fees and court costs.
Management charges will apply to any gross income received. This includes but is not limited to base rent, utility charges billed back to the resident, damage charges billed to the resident, improper notice fees and re-letting charges, move out damages, items charged to tenant for reimbursement and any other item used to increase the gross rental income. Fees are due upon receipt of such payment from resident but may be billed to the owner at a later day in the month during bulk payment of fees and monthly statement preparation. Tenant payments shall not intentionally be applied to charges that carry a higher collection rate for MOD. The spirit or intent of the tenants payment shall be considered whenever manually applying charges. Our software does apply payments to rent charges first for payments that are applied automatically. Our system rounds up for any calculations resulting in tenths of a penny due. The annual fee will not be pro-rated and will be charged for the first partial year in full if sign up is within the first 9 months of the year. For an owner requesting extra services like paper checks or mailed statements there will be a monthly fee of $12.50.
If a property owner wishes to charge significantly less than the market rate then there will be no adjustment to the management fee. The manager will advise the owner if they believe this is occurring and will provide supporting evidence of the market rate and notification of the fee that will be charged.
Discounts/waived rent that is tied to an owner negotiation of a lease negotiation shall not reduce the management fee. Lease negotiations intended to terminate a lease early for the purpose of sale of the property aren’t included in MOD’s services. MOD won’t oversee a lease negotiation/termination that an owner arranges with the resident directly. New lease charges are not adjusted based on the length of the lease.
All maintenance, improvement and repair work will be ordered by MOD. MOD will work with vendors at its sole discretion, and may require that vendors complete our vendor questionnaire, provide a W9 and provide proof of insurance and/or completed waivers. Vendors will be expected to communicate promptly, invoice professionally and provide quality customer service to tenants. The owner will not order work to be completed at the property as that is the prerogative of MOD. MOD will use vendors requested by the owner provided that the vendor meets MOD vendor requirements. Owners will not complete any work on the property themselves.
MOD does not facilitate coverage or repair through builder warranties, 3rd party warranties or manufacturer warranties. MOD will pursue repairs outside of such warranties unless such warranties don’t unreasonably impeded in the performance, timing or quality of the work. This will be in MODs sole discretion.
MOD may pay delinquent HOA dues in order to ensure that services and access to facilities provided by the HOA which are included in the lease are not interrupted.
Monthly statement and disbursement of proceeds will occur approximately 10 business days after payment by the tenant. For example, for a tenant paying on the 1st of the month the Owners statement and disbursement will occur around the 15th of the month. Any statement published and shared to the owner’s portal or sent by mail shall also constitute an invoice if there is a negative balance in the owner’s account. No monthly statement shall be sent to the owner until the property is leased unless there is financial activity on the account for that month. Monthly statements may not be issued if there is no financial activity for a property over a given month. Statements sent are deemed to be approved by the owner unless MOD is notified in writing within thirty (30) days from date of statement, setting forth the errors. Owner shall reimburse Broker for all expenses within five (5) business days of being notified of funds needed, if expenses are greater than funds received. MOD is not able to pay any vendors if the owner’s property account does not have enough funds to cover the invoice.
The owner agrees to consent to electronic receipt of 1099’s and emailed monthly statements. The owner agrees to receive proceeds via ACH. An additional cost will be charged for any item mailed which could otherwise be handled electronically.
MOD will enforce the lease via warning notices, follow up calls and texts and eviction or the threat of eviction at its discretion. This will include common items such as HOA Violations, delinquent water bills, code enforcement violations, police correspondence and neighbor complaints.
MOD requires that an owner notify us if they move. We also require a valid email and phone number with working voicemail. MOD will maintain a phone system with a general voicemail box and cell phones or direct extensions for each employee with a working voicemail.
If an owner wishes to terminate management services, there are certain scenarios in which MOD will continue to provide services beyond the termination date. This might occur during application processing or when a lease terminates at the close of a month and the owner wishes to sell, self-manage, or occupy the property. In such cases, even if the lease and contract end date are at the end of the month, MOD will offer to complete a move-out walkthrough, document property condition and order and oversee repairs necessary for damages being charged to the resident. MOD would also still complete the final deposit accounting provided that it holds the deposit. This offer would require that the owner and the owners contractors or vendors wait to perform any of their work until after work completed by MOD and it’s vendors is complete. MOD will not oversee work in scenarios where the owner and MOD are simultaneously pursuing repair or improvement work. With regard to preparation of a final accounting statement the last date services are provided would be used as a benchmark for sending the owners final accounting which is due within 30 days of the last date of service along with disbursement of funds to the owner.
Payments received after services terminate are still subject to management fees. The owner agrees to keep MOD updated with current contact information in the event that any prior tenants have a balance due and make payment owed after the management contract end date.
Insurance Notice:
Insurance policies change when owners no longer occupy the property. The typical ‘homeowners’ policy is not a proper safeguard once the property becomes a rental. The normal homeowner’s policy is only good so long as the home is owner-occupied.
Owners will update their insurance provider that the property is being used as a rental. Below are some common changes that will result:
MOD Properties encourages property owners to review the information above with their insurance provider.