How to Fire Your Property Management Company!
You hired a property manager for specific reasons. Your rentals may have started taking up too much time. You may have found it difficult getting repairs done in a timely manner. Poor tenant quality may have caused costly turnovers. You may have wanted to scale your business and couldn’t do it and manage the property.
Whatever your reason was in the beginning may not be the same reason you are looking to move on to a new property management company. Unfortunately, for most people the thought of having to fire anyone is difficult and uncomfortable. Here is a quick how-to explanation of the steps you’ll need to take when you want to fire your property management company.
8 Steps to Firing Your Property Management Company
1. Review your contract terms
When considering changing companies it’s a good idea to really read through your current contract and review all the terms. Most contracts have clauses for selling property, length of contract and possible termination fees. If you are okay with any penalties there may be for terminating your current contract, then you can start finding a new company. If not, you may want to go to your current company to discuss the issues and find a solution.
2. Interview new management companies
Before cutting the cord, you’ll want to interview 3 or 4 management companies you’re considering for hire. Questions you may want to ask to determine if they are a fit for you are:
- Have you managed similar properties?
- How do you handle maintenance and repairs?
- How quickly do you respond to tenants?
- Are you on call 24/7/365?
- How often will you be at the properties?
- In which manner do you handle emergencies?
- How do you manage tenant relationships?
- Are you familiar with local laws pertaining to my properties?
- What do you do to fill vacancies and estimated down time?
- What kind of record keeping and accounting do you provide?
- Also be sure to ask questions regarding the issues you have with your current management company.
3. Hire the best fit
If you find a company you feel will be a good fit, start the contract process before firing your current company. You want to make sure you don’t have downtime in management, especially since you don’t want it to fall back on your shoulders. When you find a new company you like and you think you can work with, hire them.
4. Terminate your current contract
You’ll want to write a professional termination letter to your current company. Be very specific as to the reason you are terminating the contract. Point out clauses in your contract showing you have valid concerns. Provide any evidence you may have showing mis-management of your rental property. Indicate when the contract is to terminate according to your contract terms.
5. Change of management forms
Your current company may have specific things they handled for you which needed approval from you. If there are any businesses that require a form to change control to a new management company ask your current company for a change in management form. This will allow the new company to take over and make decisions for you.
6. Contact companies where the manager represents you
Be sure to notify banks, utilities, insurance and any other company you have given permission to work with the management company on your behalf. You’ll want to fill out any form or notice to give them all the new contact information for the new company.
7. Inform your tenants
You can send your tenants a letter letting them know there is a change in management. Give them all of the important information they need for the new company. Especially how they can contact them and how and where they will be paying rent. Most companies will also send out their own communication but tenants will be skeptical if they haven’t heard from you first.
8. Start the new relationship on the right foot
You’ll want to have a very frank discussion about what you expect from your new management company. Talk about the issues you had with the old company and how you expect to avoid the same problems in the future. If the new company knows your expectations up front, it will be easier to discuss issues if they arise.
Property management companies are in the business to serve their property owners. If you feel something is not going properly, open the lines of communication and have a discussion to solve the problem. If you are currently dealing with management issues, contact Day Property Management www.daypropertymanagement.com to see how they can help. Fill out the contact form at www.daypropertymanagement.com/contact or call 920-968-0626.