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Why property managers require additional insurance…questions about insurance and landlording

Why would a property manager require additional insurance?

Well the big reason is to protect you the landlord client. There are many risks when managing and owning rental property. If you are sued for any reason we will most likely be sued. Yet when you agree to work with our company and most any other manager we are indemnified by our clients for these risks.  The main problem is that if we are not named on your insurance policy the attorney your insurance policy appoints will only represent you and not us and we will have to incur a separate attorney to represent us. Those attorneys may then fight or might work together. Either way we end up no longer being in the same corner and our clients could find themselves in the positions of paying not just the insurance deductible but also our attorneys fees. Our clients don’t want that to happen nor do we.

 

Why do we have to have your insurance information as an owner?

Winters alone in Northeastern Ohio have been fairly difficult this year for landlords. Between ice dams, water backups and freezes in 2015, I’ve seen damages from just a few hundred dollars all the way to $30,000 PLUS! When an emergency arises property managers need to be able to contact the contractors covered, we need to know what is covered, and what can we actually pay for. You don’t want to call an owner in the middle of the night or an insurance agent for that matter asking a million questions. That would just delay the whole process and possibly cause more damages to the property. To be prepared for an emergency you need to have a copy of the owner’s insurance policy. Make this a requirement and add the copy to the property file.

Do you know what your policy covers?

Many homeowners don’t. I suggest calling your insurance company and asking what your coverage is. Somethings you want to try to purchase is the loss of rent coverage. It is a little more expensive to purchase but definitely worth it. If a tenant moves out a few months before their lease is up then your policy covers those months of rent that you would lose. You also want to make sure your policy covers water back up, for when the sewer gets backed up. We all know this is just something that happens.Another requirement we have added is tenant insurance.

Why do we require your tenants to purchase tenant insurance?

It is very affordable ranging from $9-$15 a month. We are able to ensure the landlord’s name is included on the policy. Require your tenants to purchase a policy through you. You will be able to ensure the landlord’s name is included on the policy. Requiring this will add double coverage to the home. As well as take care of a lot of issues when you have an insurance claim. For example, if your tenant has to stay in a hotel for a night due to a water leak  Who doesn’t want that? Your home should also be covered if there is damage caused by tenant negligence. It will also help you take care of several issues when tenants do have a claim. Hotel stays, for example, are one of the coverages that many tenant insurance policies include.  Many insurance companies will give a discount on your policy when you require tenants to purchase insurance. This is one way we help landlords when they need it most!

Our experienced investment property management team can relieve you of the burden of managing your rental property while saving you some serious money!

Call us today at (440) 220-7300 to see how we can help you!

 

Handling Property Taxes in Northeast Ohio

One of the things that you will have to look forward to paying every year if you own rental property in Northeast Ohio is property taxes.

Property taxes in Northeast Ohio are handled by the County Auditor / County Treasurer’s office and are always paid in arrears, meaning that they are paid 6 months in advance. For example: if you own your Ohio Rental Property from January 2015 through December 31st 2015 you will get your tax bill in July 2016 for the first six months of 2015.

Let’s say that you sell your mission is to sell your rental home in July 2016, you will get another property tax bill for the second six months of 2015 plus you would still have to pay your property taxes for the month of July 2016.

Where Do The Property Taxes Go?

In Ohio approximately 60 percent of the revenue from your property taxes goes towards funding schools.

How Property Taxes Are Paid

Ohio Property Taxes can be paid in a variety of ways including:

Paid By Your Lender – You have the option of having your paying your property taxes each month as part of your mortgage payment then your lender will take the money which is paid towards your property taxes and place those funds into an escrow account so that they can pay the property taxes when they are due.

Paid By Your Property Management Company – We do receive property tax bills from time to time and in many cases we will either: pay the bill for you if it’s equal to one months-worth of rent, pay the bill with what we have available to pay, or send you the bill and ask you to pay it.

Property Taxes In Northeast Ohio - Learn More About How They Are Paid

Got questions about paying Property Taxes In Northeast Ohio? Call us at (440) 220-7300.

Property Tax Breakdown

Voided Tax Rate – This is the total tax rate which was approved by Ohio voters and it’s used by the taxing district in your county to fund the library, school district, vocational school, community college and more.

Effective Tax Rate – Thanks to HB 920 (Passed in 1976) your tax rate will be reduced when property values in your taxing district begin to increase thanks to updates and “triennial” reappraisals.

Tax As A Percentage Of The Market – This means that the market value of your property will be multiplied by what is the property tax percentage which is listed by your taxing district.

Paying Monthly Is the Best Option

Unfortunately paying property taxes may come as a shock for some Ohio Rental Property Owners that’s why it’s always the best option to consider an easy pay, or budget pay option, which many counties, including Cuyahoga County offer because, this will allow you to budget your money out so your property taxes are paid over time instead of having to pay those property taxes all at once.

Get North Eastern Ohio Property Management

For more information on how property taxes are handled in Ohio, or to get property management for your Ohio Rental Property, contact Realty Trust Service today by calling us at (440) 427-0123 or CLICK HERE to email us through our website. 

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