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You decided to manage residential rentals

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Presented by: Gail A. Moncla, CPM, MPM Property Management University, Inc. www.propertymanagementuniversity.net info_at_propertymanagementuniversity.net – PowerPoint PPT presentation

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Title: You decided to manage residential rentals


1
You decided to manage residential rentals Now
What?
  • Presented by
  • Gail A. Moncla, CPM, MPM
  • Property Management University, Inc.

www.propertymanagementuniversity.net info_at_property
managementuniversity.net
407-571-0757
2

Presented by Gail A. Moncla CPM (Certified
Property Manager) IREM Institute of Real Estate
Management MPM (Master Property Manager) -
NARPM National Association of Residential
Property Managers Broker owner -
Rental Home Management Services, Inc. Owner -
Property Management University,
Inc. Co-owner - Property Genie, Inc.
(software) Florida licensed Real Estate
Broker Florida licensed Real Estate Instructor
  •  

3

Disclosure 1. Although every
effort has been made to ensure that the
information in this course was correct at press
time, the author and publisher do not assume and
hereby disclaim any liability to any party for
any loss, damage, or disruption caused by errors
or omissions, whether such errors or omissions
result from negligence, accident, or any other
cause. The author is not a lawyer and is not
seeking to provide legal advice. To ensure
compliance with all rules and laws the student is
advised to seek legal counsel. 2. Throughout this
course I will refer to a company named Magical
Management. Magical Management is a fictional
company. All fees, costs and processes discussed
throughout this course are hypothetical and for
illustration purposes only. Actual fees charged
in the residential property management business
may vary by geographical area and differ from
company to company. The students and/or
instructor will not discuss fees of their own
companies inside or outside the classroom. Any
hypothetical fees and illustrations used in this
course are not intended to direct the students to
use the fees as illustrated. Nothing in this
course is to be construed as attempting to set
any fees to be charged for services by
residential property management companies.
  •  

4
Residential property management is a lucrative
and fulfilling career if planned and executed
correctly. However, without property planning you
can find yourself in trouble fast if you make a
misstep. Which direction are you
headed? Todays information is designed to
provide you with the requirements and guidelines
required of residential property managers in
Florida. My goal today is to provide you with
the knowledge to stay Headed in RIGHT
direction! Limit your Liability!
  •  

5
DEFINITION A residential property manager is a
person who specializes in and is responsible for
a dwelling unit rented for use as a home or
residence for one person or for two or more
persons who maintain a common household for
others to administer and enforce leases, rental
agreements and other tenancies. To maintain and
protect the property value for the investor, the
resident and the general public. A RESIDENTIAL
PROPERTY MANAGER 1. Administers leases, rental
agreements and other tenancies. 2. Maintain the
property to preserve value. 3. Reports to the IRS
and other governmental agencies as
required 4. Escrows funds for residents and
property owners. 5. Engages supervises repair
and maintenance vendors to perform services
  •  

6
In Florida a real estate broker must
follow Florida Statutes Chapter 455 Business
and Professional Regulations General
Provisions Florida Statutes Chapter 475 Real
Estate Brokers, Sales Associates, Schools and
Appraisers Florida Administrative Code Chapter
61J2 Florida Statute 83.40 83.682 Residential
Tenancies Landlord Tenant Law Brokers must also
adhere to federal laws including Fair Housing,
EPA Renovate Repair Paint (properties built
prior to 1978) just to name a couple.
  •  

7
Today I will introduce you to the
following License requirements Responsibility
of the DBPR and FREC Liability for brokers of the
firm Security Deposit claims and disputes Trust
Liability more than just balancing the bank
statement Management agreement important
clauses Top ten questions property owners ask
when interviewing for a property manager Signing
up a property owner (client) and his/her
property Condo and Homeowners associations Workin
g with vendors Lead based paint
requirements
  •  

8
Rental application Approval Denial Lease
agreement important clauses Maintenance
responsibility/liability Access to the
property Handling problems during tenancy Non
payment of rent evictions Tenant renewal or
move out Policies and procedures for
consistency Develop a Yes I can! attitude
  •  

9
License requirements Advertising and renting
residential properties are services of real
estate and you must have a valid Florida license
to provide these services for others for
compensation. Further if you have a sales
associates license you must place your license
with a Florida licensed broker and work with that
brokers permission. DBPR and FREC As real
estate licensees we are governed by Florida
Statutes and Rules in many aspects of our
business. These statutes and rules apply to our
day-to-day processes and interactions with the
public. The stated purpose of the Florida Real
Estate Commission from its inception is to
protect the public. This power for the FREC to
govern our day to day processes is granted in
Florida Statutes Chapter 475.05 Florida Statutes
83.49 Landlord Tenant Law is the basis for our
policies in regard to residential landlords and
tenants.
  •  

10
Liability for brokers of the real estate
firm You are responsible for all actions for
all licensees working under your
supervision. This includes actions you know
about and those you dont. FREC believes you
know or should know the actions your licensees
take to provide services. The agreement signed
between the broker and sales or broker -associate
licensees to work under the brokers license
should include Residential management services
Yes or NO If yes What education is required
in order for the licensee to handle rental
accounts? What policies and procedures are
required to meet the office guidelines? As a
broker, leaving these decisions to licensees with
no training leaves you open for severe
disciplinary action when things go wrong.
  •  

11
Security Deposits Security deposit money must be
held in a Florida banking institution. These
funds must be held separate and cannot be
comingled with the brokers company funds. The
security deposit belongs to the tenant
Unless or until they do not fulfill the terms of
their lease They do not pay all funds due
They do not return the property in good
condition (normal wear and tear excepted) A
proper claim has been made and time has been
given for the tenants response This money does
not belong to the property owner and should not
show on his financial journal unless the journal
specifically labels it the tenants security
deposit. The landlord must within thirty days of
receipt of the security deposit notify the tenant
in person or by mail where the money is held and
what type of account is being used.
  •  

12
When the property is vacated, the release of the
security deposit back to the tenant or to the
property owner is determined by several factors.
No part of the security deposit should be
released or used during the lease term or
occupancy of the tenant. There are several
factors to consider when deciding on making a
claim against a tenants security
deposit Review the condition of the property
when the tenant was granted possession Review all
maintenance done to the property during the
tenants occupancy Record the condition of the
property when the tenant vacated it Decide what
work must be completed to rent the
property Decide what work should be charged to
the tenant because of their use normal wear and
tear accepted. How long have the tenants lived
in the property Verify all of your facts to be
placed on the security deposit claim Check and
recheck your math
  •  

13
You received the tenants notification the tenant
is leaving at the end of their lease term which
is July 31st, 2013. How long do you
have To return the deposit in full?
________ To make a claim against the
deposit? ________ For the tenant to respond
to the claim? ________ To send the tenant
any unclaimed portion of the security deposit? 30
days from the date you made the initial claim
  •  

14
Your security deposit claim must have the
following minimum language This is notice of
my intention to impose a claim for damages in the
amount of _________ upon your security deposit
due to ___________________________(list
reasons). It is sent to you as required by F.S.
83.49(3), Florida Statutes. You are hereby
notified that you must object in writing to this
deduction from your security deposit within
fifteen (15) days from the time you receive this
notice or I will be authorized to deduct my claim
from your deposit. Your objection must be sent
to _________________________ . (claimants -
property managers or property owners
address) You can say more but you must have
this exact language as a minimum in the document
  •  

15
Security deposit claims must be mailed by
certified mail to the tenants last known mailing
address. F.S. 83.49(3)(a) Once you have
mailed the claim by certified mail how long does
the tenant have to respond to the claim? 15
days Does the tenants written response have to
be made by certified mail? This is notice of my
intention to impose a claim for damages in the
amount of _________ upon your security deposit
due to ___________________________(list
reasons). It is sent to you as required by F.S.
83.49(3), Florida Statutes. You are hereby
notified that you must object in writing to this
deduction from your security deposit within
fifteen (15) days from the time you receive this
notice or I will be authorized to deduct my claim
from your deposit. Your objection must be sent
to _________________________ . (claimants -
property managers or property owners
address)
  •  

16
MAGICAL MANAGEMENT SETTLEMENT STATEMENT To
Tenant Name Tenant Name CC Tenant Name Tenant
Name 123 Old Address Lane 456 New Address
Lane Orlando, Florida 56789 Orlando, Florida
56789   Certified Mail 123 0001 2223 4566 CC-
Certified Mail 123 0001 2223 4567   RE Property
located at 123 Old Address Lane, Orlando,
Florida 32323   This is a notice of our intention
to impose a claim upon your Security Deposit for
damages and/or unpaid rent as outlined in the
following statement. It is sent to you as
required by Section 83.49(2) Florida Statutes.
You are hereby notified that unless you object in
writing to these deductions from your security
deposit, within 15 days from the date you receive
this notice, our deductions have been authorized.
Your objection must be sent to Magical
Management, 123 Any Other Street, Orlando,
Florida 56789. A check for any amount due you is
enclosed. If you choose to object to the claim,
return the enclosed check along with your written
objections to this office. No further action with
respect to your objection will be taken at that
time unless initiated by you. Should you initiate
legal action as a result of your objection and
you are unsuccessful, you will be charged for
court costs plus a reasonable fee for our
attorneys.   Management apologizes for the harsh
nature of this form, which is required by Florida
Statues. We hope that you enjoyed your stay with
us.   Residence vacated 1/31/2011 Rent paid
through 1/31/2011 Rental expiration 2/28/2011 Re
sidence re-rented NO Written notice
given NO Keys returned 2/1/2011  Credits due
the resident for Security Deposit 1,000.00
Less Charges due for Unpaid rent from 2/1/2011
through 2/28/2011 1,000.00 Cleaning Appliance
s Carpet 100.00 General 125.00 Repairs
Drywall 150.00 Yard-edging and
service 150.00 Certified Mail
Charges 11.00 Total Charges 1536.00 Differe
nce Total Credits 1,000.00 Less Total
Charges
536.00 Difference Amount due the residents
. . . . . . . check enclosed Amount due the
lessor . . 536.00   Date February
5th, 2011 by ________________________________
Your name here, Property Manager  If not paid
within 15 days this may be turned over for
collection. If it is reported to the Credit
Bureau, it will remain on your credit history for
seven years as a delinquency even if you later
pay it off. Note This notice does not waive or
limit any of landlords rights to damages or
amounts due which may exceed security deposit or
amounts listed on this form.
17
  • What do you do when the tenant disputes the claim
    in writing?
  • The broker has choices
  • Settle the dispute through negotiation
  • Sign an agreement between the parties
  • Consider a general release
  • Continue holding the funds until the statute of
    limitations has expired.
  • What is the statute of limitations for a tenant
    to sue in court for
  • the return of their security deposit?
  • Have an attorney file a bill of interpleader
    with the court
  • Document asking the court to decide who should
    receive the security
  • deposit
  •  

18
F.S. 83.49 (3) (d) reads as follows )
Compliance with this section by an individual or
business entity authorized to conduct business in
this state, including Florida-licensed real
estate brokers and sales associates, shall
constitute compliance with all other relevant
Florida Statutes pertaining to security deposits
held pursuant to a rental agreement or other
landlord-tenant relationship. Enforcement
personnel shall look solely to this section to
determine compliance. This section prevails over
any conflicting provisions in chapter 475 and in
other sections of the Florida Statutes, and shall
operate to permit licensed real estate brokers to
disburse security deposits and deposit money
without having to comply with the notice and
settlement procedures contained in F.S.
475.25(1)(d). Note This allows the broker to
decide to disburse the security deposit as
claimed. However, the broker still has civil
liability if the tenant files a lawsuit. In other
words, you may disburse the funds as claimed and
the tenants only recourse is to file a lawsuit.
You would have to defend your claim.
  •  

19
DANGER! If either party institutes an action
in a court of competent jurisdiction to
adjudicate the partys right to the security
deposit, the prevailing party is entitled to
receive his or her court costs plus a reasonable
fee for his or her attorney. The court shall
advance the cause on the calendar. F.S. 83.49
(3)(c) Over the years, I have found with good
documentation and good communication a settlement
amount can be reached by all parties. Once a
settlement amount has been agreed to, it is my
recommendation that the parties sign a release of
rental security deposit like the example on the
following slide. If you are closing out the
property management account you may also want a
general release signed by all parties.
  •  

20


Release of Rental Security Deposit
THIS RELEASE is entered into between the
undersigned Tenants, the undersigned Property
Owners (or their agent) Magical Management, who
were parties to a lease, covering the following
property located at 123 Any Street, Orlando,
Florida, 56789 WITNESSETH That each of the
parties hereto in consideration of each of the
parties releasing all of the other parties from
the aforesaid rental security deposit receipt, do
hereby release each of the other parties to said
rental security deposit receipt from any and all
claims, actions or demands whatsoever which each
of the parties hereto may have up to the date of
this agreement against any of the other parties
hereto by reason of said rental security deposit
receipt. It is the intention of this agreement
that any responsibility or obligation or rights
arising by virtue of said security deposit
receipt are by this release declared null and
void and of no further effect when signed by all
of the above named parties. The escrow agent,
(Magical Management) holding the rental security
deposit is hereby directed and instructed
forthwith to disburse said deposit held of
1,000.00 in escrow in the following manner
500.00 TO Magical Management- (Agent for
the property owner) 500.00 TO Tenant names
(former tenants) IN WITNESS WHEREOF the parties
have hereunto set their hands and seals that year
and date below written. Date signed by
tenants ________________,20_______. ____________
_____________ X____________________________ Witnes
s Tenant- Tenant Name _________________________ X_
___________________________ Witness Tenant-
Tenant name --------------------------------------
--------------------------------------------------
------------- Date signed Property Owner (or
Agent)_______________20________. ________________
________ X____________________________ Witness Mag
ical Management ________________________ X_______
_____________________ Witness Property Owner (or
Agent)
  •  

21
  •  

Must be Notarized
22
Trust Liability Balancing
your bank statement is not enough A trust/escrow
account is an account in a bank, trust company,
title company having trust powers, credit union,
or a savings and loan association within the
state of Florida. What is in a name? . . . Make
sure the name of your account includes the word
trust or escrow in it. Magical Management
Security Deposit Escrow Account Magical
Management Rent Management Escrow Account NOTE
The word trust or escrow is the institutions
notification that the funds in this
account do not belong to you. How many accounts
must you have? One (two recommended) Remember
you must balance your trust liability on each
trust/escrow account.
  •  

23
What does it mean? Escrow To place in escrow,
to hold the tenant agrees to escrow the sum of
2000.00 with his property management real estate
broker as a security deposit. Trust The
reliance on the integrity, strength, etc., of a
person or thing confidence. Liability The
state of being liable (responsible by law), a
financial obligation Deposit A sum of money
or its equivalent, delivered to a real
estate licensee as earnest money, or a payment,
or a partial payment in connection with any
real estate transaction, or such sum delivered
in escrow, trust or on condition in any
transaction conducted by such licensee.
(Chapter 475, F.S. Rule 61J2-14.008
  •  

24
What money has to be deposited
into a trust/escrow account? Property owner
funds Tenant funds Reserves for
maintenance Security deposit Pet
deposits Rent proceeds prior to
disbursement Advance Rents All holds you place
on funds for any reason Prepaid items Prospect
Funds Vendor Funds Holding deposit Funds
for supplies First months rents prior to move
in Funds for security deposit In other words, if
you accept money that does not immediately belong
to you, the money must be held in a trust/escrow
account for the benefit of the proper
person. The total trust liability then must be
determined monthly. The bank statement must be
balanced and the reconciled balance must reflect
exactly the total trust liability.
  •  

25
What records must be available for audit? All of
them . . . Deposit slips ( How long do you have
to deposit funds into the trust account) 3
business days Bank statements for each bank
account Agreement between the parties All
documents that substantiate the requirement to
account and deliver funds
  •  

26
What has to be on the report? Everything . .
. Date reconciliation completed May 20th,
2013 Date used to reconcile balances April 30th,
2013 Name of bank Bank of Property Management,
N. A. Account Name Magical Management Escrow
Account Account Number 555777888 Account
balance Deposits in transit Outstanding checks
identified at least by date and number Itemized
list of brokers trust liability Name of
person, amount, type of funds
security deposit advanced
rent Records showing date, receipt and source of
funds Monthly signed broker reconciliation
signifying the broker has reviewed the
documents By virtue of have a real estate
brokers license and accepting money for others,
we have agreed to abide by and fulfill these
requirements. Daunting? No, not if you have a
system and stick to it. Step 1 Balance your
bank statement Step 2 Balance your trust
liability
  •  

27
  •  

28
  •  

29
  •  

30
Comingling of funds No No dont do it except
. . . . . How much business funds can a broker
keep in each escrow/trust account? Sales trust
account 1000.00 Property management trust
account 5000.00 Never place rents in your
business operating account The qualifying broker
Is not required to complete this work. Must
be a signatory on the trust/escrow account with
the bank. Must sign the monthly trust
liability reconciliation. Signing the report
signifies that he/she (broker) has reviewed the
documents and believe them to be correct.
  •  

31
Real estate brokers in the property management
business accept a tremendous amount of money on
behalf of others. it is understandable that there
are rules to try and protect the public from
disappearing funds. The broker must also protect
his/her company with methods and practices that
attempt to protect the money held to the best of
his/her ability. Embezzlement is a problem and
one protection for your business is to have a
separate bookkeeper balance your bank statements
and trust liability. In other words, the person
that makes the deposits, compiles ACH files,
write checks, etc. should not be the same person
that balances the bank statements and trust
liability. Check to see if the ACH file that is
compiled from your software to be uploaded to the
bank can be edited once compiled. Also check with
your bank to see if the file can be accessed
after uploaded and can changes be made to the file
  •  

32
Property Management Service Agreement Protect
your company with your Property Management
Service Agreement. It is one of the two most
important documents in your business. The other
is your lease agreement. You must have the
authority to Manage and be in control of the
property Prepare, negotiate, execute and
terminate leases Advertise Serve legal notices,
prosecute in the name of the property owner
or manager at the property owners
expense Collect money such as application fees
without accounting to the property owner Keep
interest (if any) earned on trust accounts Enter
the premises when manager deems necessary Pay
Homeowners or condo association fees (if property
owners funds are available
  •  

33
Property Management Service Agreement Define
the property owners responsibility to Provide
information to you in a timely manner Pay for
expenses that exceed rental proceeds for items
that are or may become due upon request of the
manager Allow you to Require general releases
from all parties to a controversy Employ a
collection agency for outstanding tenant
debts Use your sole discretionary judgment to
withhold or reserve funds to meet the owners
expenses including your income and assign all
rent proceeds as security for these
obligations Accelerate all fees if Owner
breaches your agreement Owner allows property
to go into foreclosure
  •  

34
Property Management Service Agreement The
property owner must warrant He/she is the sole
owner of the property with the authority to enter
into this contract The property has no
encumbrance that would inhibit delivery of your
services The owner has no knowledge of
environmental hazards and takes
full responsibility if any are found Further
protections needed If the banking institution
holding your trust funds fails, the manager is
not held liable. Property owner holds harmless,
all involved from all damage suits and
claims from liability for injuries to persons
and property in connection with the management
of the premises Waiver of jury trial Power of
attorney (evictions) Protection against lawsuits
and complaint made to various agencies
  •  

35
Property Management Service Agreement Here are 5
sample clauses To prepare and negotiate new
leases and renewals and TERMINATIONS of existing
leases as deemed appropriate by MANAGER. Manager
is authorized, for and on behalf of the property
owner, to execute leases and lease
renewals. Provide for authorized individuals to
inspect the property as deemed necessary by
manager and to provide security deposit
evaluations at the expiration of a tenancy.
Should a dispute over the claimed amount of the
security deposit arise, manager shall in their
sole discretion determine the settlement of the
claim. If the property owner feels he/she has
not been treated fairly and files a lawsuit or
complaint with the court, Board of Realtors,
Better Business Bureau, mediation or any other
administrative agency arising out of this
agreement and if the manager successfully defends
same, the property owner is responsible to
reimburse manager for costs including attorneys
fees and managers time spent defending the
action.
  •  

36
Severability If any provision of this agreement
becomes unenforceable all other provisions of
this agreement remain in force and
enforceable. Waiver of jury trial The parties
hereby waive their right to a jury trial on any
issue arising from the subject matter of the
agreement regardless of whether or not the cause
of action is a tort or contract action. The
parties specifically agree that all issues
arising out of their relationship shall be
resolved by Judge sitting without
jury. (this clause should also be in your
lease)
  •  

37
  • Top ten questions property owners ask when
    interviewing a property manager
  • Please give me some background on your business
    and your qualifications
  • Do you have knowledge of the area?
  • Will you explain your experience level to me?
  • How do you find tenants?
  • How do you handle the responsibilities of
    management?
  •  

38
6. How will you communicate with us? 7. If a
problem crops up, how do you deal with it? 8.
What sets you apart from your competition? 9.
How do you handle the finances? When will I
receive my rental proceeds? 10. What are your
fees?
  •  

39
Seriously folks, the last question a property
owner should ask is about the costs. The reason
is this if the property owner asks the cost
question first and based on that answer decides
to interview additional property management
companies, he or she may have missed a very
qualified company that delivers the very best
services. The property owner must listen to what
the property management company provides to
determine if the services warrant the cost. We
have just written your outline for the
information you will include in your
presentations to clients. Did you realize what we
were doing? Wasnt it painless? To make your use
of this information most effective, your plan
will need to be formalized, in written form, as a
formal "marketing plan." The essence of the
process is that it moves from the general to the
specific, from the vision to the mission, to the
goals, to the business objectives of the
organization.
  •  

40
Signing up a new property owner and his/her
property
  • New Account Set Up Form
  • Property Management Service Agreements (extras)
  • Blank Property Management Addendums
  • Property Owners Data Sheet
  • ACH Request Form and IRS W-9
  • Property Appraiser Information on property
    address
  • 7. Comparative Rental Market Analysis
    (completed if possible)
  • 8. Property Owners Handbook or your own
    marketing materials
  • 9. Landlord Tenant Law for your state
  • 10. Sample Marketing Flyer
  • 11. Sample lease (Yes? No?)
  • 12. New Property Start Up Maintenance Form
  •  

41
  •  

42
  •  

43
PROPERTY DATA SHEET 1) Property Address
2) Primary Owners Name 3) Secondary
Owners Name 4) Primary Owners Tax ID
_______ ? _____ ? _______ 5) Home Phone
(________) Work Phone (________) Fax
Number (________) Email Address Postal
Address 6) Preferred Method of
Communication __ Phone ___ Fax ___ Email __
Mail __ Other 7) Property Zip Code Heated
Sq. Ft. Map Grid Total Sq. Ft.
Subdivision Name HOA Approval Required Y
or N HOA Phone Gated Community Y or
N Entrance Gate Code Year Built 8) Type of
Property A) House B) Condo C) Town Home D)
Duplex E) Triplex F) Quad 9) Floor Plan A)
Single Story B) Split-Level C) Two Story D)
Split-Planned E) Other________________________
44
10) Exterior Appearance A) Wood Siding B)
Aluminum Siding C) Brick D) Cinder Block E)
Stucco F) Corner Lot G) Waterfront Lot H) Water
view Lot I) Other ____________ 11) Area
Location A) Northwest B) Northeast C)
Southwest E) Southeast F) Seminole Co. G)
Volusia Co. 12) Number of Bedrooms A) 1 B) 2 C)
3 D) 4 E) 5 F) _____ Extra room/den/loft/office/
enclosed garage/guest quarters may be used
as additional bedroom. 13) Number of
Bathrooms A) 1 B) 1 ½ C) 2 D) 2 ½ E)
3 F) ______ 14) Bathroom Extras A) Roman Tub B)
Jacuzzi Tub C) Double Vanity D) Glass Shower E)
Water Closet F) _____ Other_____________________
_____ 15) Living Room A) Living Room B) Formal
Living Room C) Living / Family Room
Combo 16) Dining Room A) Dining Area B) Formal
Dining Room C) Kitchen Dining Area E) Breakfast
Bar F) _____ Other__________________________ 17)
Kitchen A) Efficiency Kitchen B) Kitchen C)
Large Kitchen D) Country Kitchen E) Kitchen
w/Island F) ____ Other__________________________
_ 18) Appliances Included A) _____ Stove
Electric or Gas (circle one) B) _____
Refrigerator With Icemaker or Icemaker Water
(circle one) C) _____ Dishwasher Built In or
Portable (circle one) D) _____ Microwave
Built In or Portable (circle one) E) _____
Washer F) _____ Dryer Electric or Gas (circle
one)
  •  

45
19) Laundry Facilities A) Laundry Room B)
Kitchen Laundry Area C) Garage Laundry D) Closet
Laundry E) Stackable Laundry Area F)
Other____________ 20) Flooring A) Carpet
Vinyl Combo B) Carpet and Tile Combo C) All
Carpet D) All Tile E) Hardwood F)
Other________________________ 21) Carpet
Color A) Beige B) Blue C) Brown D) Gold E)
Green F) Rust G) Mauve H) Other_________________
______ 22) Parking Facilities A) Double Car
Garage B) Single Car Garage C) Carport D)
Assigned Parking E) 3 Car Garage F) Street
Parking G) Electric Garage Door Opener YES
or NO(circle one) H) Assigned Parking of
Spaces ______ / Parking Space s Assigned
_______ 23) Heating A/C A) Central
Electric B) Central Gas C) Oil Heat/Central
A/C D) Gas Heat Cent Air E) Window A/C
Units 24) Paddle Fans A) 0-3 Fans B) 4-6
Fans C)Attic Fan D) Remote Controlled
Fans 25) Window Coverings A) Mini Blinds
w/Verticals at Sliding Glass Door B) Mini Blinds
Only C) Verticals Only D) Wooden Slat Blinds E)
Drapes F) Combination __________________________
_____________________ G) Other
__________________________________________________
___ 26) Fencing A) Wood Privacy B) Chain
Link C) PVC Fencing D) Screen Enclosed
Area
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46
27) Special Features A) Swimming Pool K)
Public Water B) Swimming Pool Hot Tub L) Well
Water C) Hot Tub Only M) Public Sewer D)
Community Pool N) Septic Tank System E)
Community Tennis O) Home Security
System F) Gated Community/Gate
Code__________ G) Screen Enclosed
Patio P)Security Code_____________ H) Vaulted
Ceilings Q) Walk-In Closets ___________ I) Sky
Lights R) Sprinkler System ___________ J)
Additional Storage S) Other ____________________
 
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28) Special Instructions A). Yard
Lawn 1. The property owner hereby agrees that
they will provide OR ask Magical Management to
provide a professional lawn service company to
cut, mow and edge the lawn at the property owners
expense. _________YES or _________ NO 2. The
property owner hereby agrees that they will
provide OR ask Magical Management to provide a
professional lawn service to fertilize and
chemically treat the lawn at the property owners
expense. _________YES or _________NO B.) Swimming
Pool/Hot Tub Service 1. The property owner
hereby agrees that they will provide OR ask
Magical Management to provide a professional pool
service to maintain the swimming pool/hot tub,
(including chemicals, cleaning and repairs) at
the property owners expense. _________YES or _____
____NO C.) Pets 1. The property owner hereby
agrees that pets may be accepted, provided
additional pet fees are collected in addition to
the security deposit. The security deposit and
pet fees (if necessary), will be used to correct
any pet damage. _________YES or _________NO 2. The
property owner hereby request that no pets be
considered. _________YES or _________NO
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Note Property owner acknowledges they understand
that restriction of pets greatly reduces the
number of possible renters for their
property. D) Pest Control 1) The property
owner hereby agrees that they will provide OR ask
Magical Management to provide a professional pest
control service company to treat the Exterior,
the lawn at regular intervals, at the property
owners expense. _________YES or _________
NO 2) The property owner hereby agrees that they
will provide OR ask Magical Management to provide
a professional pest control company to treat the
Interior of the property at regular intervals,
at the property owners expense. _________YES
or _________ NO
49
E) Keys Remotes 1) Number of Keys turned
over to Manager_______ 2) Number of Garage
Remotes given to Manager ______ 3) Number of
Mail Box Keys given to Manager
______ F) Warranty Information 1) Property
Owners have no appliance or fixture warranties,
(other than home owners insurance
policy). 2) Property Owners have a New Home
Warrantee from Builder Name of
Builder Policy Phone Appliances or
items covered 3) Property Owners have
purchased an appliance or fixture warranty Name
of Warrantee Company Policy Phone
Appliances or items covered 4) Manager was
provided a copy of warrantee referenced in B) or
C) above?
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50
_____ YES or _____ NO 5) Any other special
instructions 29) Rental Proceeds
Payments 1) Property owners desire rental
proceeds to be direct deposited onto their bank
account. 2) Property owners desire mortgage
payments to be made from rental proceeds. This is
subject to adequate funds available in property
owners account, (see property owners handbook for
further information) 3)_____ Property owners
desire HOA payments to be made from rental
proceeds. This is subject to adequate funds
available in property owners account, (see
property owners handbook for further
information) 4) Other Property owner desires
the following items be paid from rental proceeds
30) Insurance Information Name Phone
Number of Homeowners Insurance Company __________
____________________________________________ Pol
icy ____________________________ Phone
_____________
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51
31) Market Survey The property owners found our
company through which of the following A)
Yellow Pages B) Internet C) Friend D) Other
Property Owners E) Sign F) Other________________
_________________________ G) Realtor Referral If
Realtor Referral, please provide name of
referring agent so that we can thank them for
referring our firm _____________________________
____________________________ 32) Rental
Range Magical Management will use its best
efforts to lease or rent the property at a rental
rate of _________ per month. Manager is given
the right to lease or rent as low as
_________per month. Manager will present all
other offers for Property Owners
consideration. I/We the property owners do hereby
acknowledge the information in the Property Data
Sheets to be accurate Date ____/____/_______ P
roperty Owner___________________________ Proper
ty Owner___________________________
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52
AUTHORIZATION AGREEMENT FOR AUTOMATIC DEPOSITS
(ACH CREDTS) COMPANY NAME ID Magical Management
Co. COMPANY NUMBER 59-00000001 I (we) hereby
authorize Magical Management Co., hereinafter
called COMPANY, to initiate credit entries and to
initiate, if necessary, debit entries and
adjustments for any credit entries in error and
to my (our) Checking/Savings Account (select one)
indicated below, hereinafter called DEPOSITORY,
and to credit and/or debit the same such
account. Depository Name Branch City
State _________ Zip Transit/ABA No.
Account No. This authority is to remain in
full force and effect until COMPANY has received
written notification from me (or either of us) of
its termination in such time and in such manner
as to afford COMPANY and DEPOSITORY a reasonable
opportunity to act on it. Please Print NAME(S)
ID NUMBER SIGNED DATE SIGNED
DATE Please write VOID across one of your
bank account checks as a sample check and return
to us with the this Authorization Agreement for
Automatic Deposits.
  •  

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54
W-8ECI (Rev. February 2006) Department of the
Treasury Internal Revenue Service Certificate of
Foreign Persons Claim That Income Is Effectively
Connected With the Conduct of a Trade or Business
in the United States Section references are to
the Internal Revenue Code. See separate
instructions. Give this form to the withholding
agent or payer. Do not send to the IRS. OMB No.
1545-1621 Part I Part II Identification of
Beneficial Owner (See instructions.) NOTE This
is an application for the foreign owner to be
able to report income from his rental property as
a business. Without this approved application you
are required to withhold 30 of the gross income
and property report it to the IRS. If you do not,
you may become liable.
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56
COMPARATIVE RENTAL MARKET ANALYSIS Date Prepa
red for Address Phone Prepared
By Leased For Lease Show recently rented
properties Show property for lease Average
Price/Sq. Ft. Average Price/Sq. Ft. Considered
Asking Price Lowest Asking Price Property
owners hereby acknowledge they have reviewed this
document and the property managers suggested
market rents for their property. Property owner
further agrees that manager will lower the asking
price 5 every two weeks until property
rents. _____________________ ___________________
__ Property Owner Property Owner
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57
PROPERTY OWNERS HANDBOOK Handbooks are designed
to provide information about your company. Your
property owners handbook will introduce them to
you and your business philosophy. It enables them
to become familiar with your processes. The
handbook itself promotes trust in the
relationship by providing knowledge and setting
expectations. It is one of the most successful
tools you will use to promote understanding and
loyalty from your customers. When you deliver
your handbook to each prospective property owner
you are outlining your services for them. The
Property Management Service Agreement is the
legal contractual agreement between you and the
property owner. The Property Owners Handbook is
the pleasant heres how we do business
agreement. Include the following in your
handbook Why choose us Marketing plan Staff
introduction Feeswhat is included (not
necessarily the amount) Frequently asked
questions References
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58
The property owner will refer to the information
in the handbook from time to time. The
information included in the handbook is compiled
from your company policies and your property
management service agreement. This same
handbook serves as your property managers
guideline for services promised. It is also an
excellent training tool for new employees or as a
refresher course for experienced ones. It is
required reading in my office.
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59
  •  

60
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61
Signing up a new property owner (client) and
his/her property
Who owns the property?
Ownership challenges Do your homework Pull deed
records - tax records Get their document showing
ownership Limited liability companies Land trusts
- estates Corporation - limited partnerships Get
the right signatures (all of them)
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62
Property Documents Home owners or condo
associations documents and rules Home warranty
policy Mortgage condition affidavit Copy of
payment coupon Lead paint disclosure Insurance
declaration page with additional insured
listed Mold disclosures Flood disclosures Personal
property disclosure Appliance manuals Features
/date page Available amenities Access to
everything Mailbox keys House keys Access
codes Garage openers
63
Working with vendors
Independent contractor? You
decide! Maintenance employees? It is essential
that you have a list of approved qualified
vendors available to your company. They may be
willing to work at reduced costs in exchange for
the volume of business your provide to
them. These contractors (vendors) are licensed
properly, bonded and insured and must be verified
regularly. You want complete information from
them and they will need to sign a Vendor/Broker
agreement with your company. If you cannot get
all of this information do not use them!
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64
VENDOR INFORMATION FORM VENDOR NAME
___________________________ ADDRESS
___________________________ PHONE
___________________________ FAX
___________________________ LEGAL COMPANY
NAME ________________________________ FEDERAL
TAX I.D. NUMBER ________________________________
BUSINESS LICENSE NUMBER(S) _____________________
___________ TYPE OF ENTITY CORP____
PSHIP____ SOLE PROP________ LIABILITY INSURANCE
CARRIER ________________________________ POLICY
NUMBER(S) ________________________________ WORK
ERS COMPENSATION (or exemptions)
______________________________ POLICY NUMBERS
______________________________ EXECUTED
this ______________ day of _________ 20____ I
CERTIFY THAT THE ABOVE IS TRUE AND CORRECT AND
THAT I AM AN AUTHORIZED COMPANY REPRESENTATIVE. I
AGREE THAT I WILL NOT HOLD THE PROPERTY
MANAGEMENT COMPANY, ITS AGENTS, EMPLOYEES OR
ASSIGNS LIABLE FOR THE PAYMENT FOR ANY WORK
PERFORMED OR MATERIALS PROVIDED FOR THE
PROPERTIES WHICH ARE OR WERE MANAGED BY THE
PROPERTY MANAGEMENT COMPANY. VENDOR_____________
__________________ (signature)
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65
VENDOR BROKER AGREEMENT This agreement is made
this __________ day of _________ 20__ by and
between _____________________, hereinafter BROKER
and ______________________, hereinafter
VENDOR. VENDOR agrees that BROKER has no
ownership interest in the properties managed by
BROKER. VENDOR agrees that BROKER is an agent of
the respective owners of the managed properties.
VENDOR agrees to hold BROKER, its employees,
agents and assigns harmless for any failure of
any property owner to pay for services, supplies,
parts, material and/or labor ordered by owner
and/or BROKER on behalf of or at the request of
owner. VENDOR agrees that they shall do no other
work on the property other than that specifically
ordered and approved by owners and/or BROKER.
VENDOR understands and agrees that the Tenant(s)
have no authority whatsoever to order any work to
be done on the rental premises. VENDOR agrees and
affirms that it carries the proper insurance,
licenses, and permits necessary to legally carry
out the requested services and agrees to hold
BROKER, its employees, agents and assigns
harmless for any injuries suffered by or damages
suffered by VENDOR, its employees, agents and/or
assigns arising out of performance of the
requested services. VENDOR agrees to look solely
to the owner of the premises where services are
performed in the event of any disputes. Owner's
name and address will be provided upon
request. EXECUTED this ______________ day of
_________ 20__ VENDOR____________________ BRO
KER_______________________ Form provided by LAW
OFFICES OF HEIST, WEISSE WOLK, P.A. 1 800 253
8428
66
What if the property was built prior to 1978?
I have personally completed the EPA Certified
Lead Based Paint Renovator course. My
graduating class I may not know how
to complete certain renovations but I do know how
to protect people and contain dust created while
the work is being done. The recordkeeping is
substantial.
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67
The following addendum to your property
management service agreement and your vendor
broker agreement would go a long way in
protecting you and your management company if a
situation arises.
ADDENDUM TO PROPERTY MANAGEMENT SERVICES
AGREEMENT In reference to the Property
Management Service Agreement entered into this
____ day of ____________, _____, by and
between__________________________, hereinafter
referred to as OWNER and Magical Management
Co., a Florida corporation, hereinafter referred
to as MANAGER for the property described as
_________________________________________. The
undersigned agree to the following 1. The above
referenced property was built prior to 1978.
2. Property Owner acknowledges and agrees that
Manager will follow the EPA Regulations in
regard Renovate, Repair and Paint Rules for
properties built prior to 1978. 3. Only EPA
Certified Lead Based Paint Renovators will be
allowed to fulfill the maintenance and repair
requirements and recording keeping rules. This
agreement upon its execution by both parties is
herewith made an integral part of the
aforementioned property management service
agreement. Executed this ____ day of
_________________, 20___ Witness_____________
_________ Owner________________________ Witne
ss______________________ Owner__________________
______  
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68
ADDENDUM TO VENDOR/BROKER AGREEMENT In
reference to the Vendor/Broker Agreement entered
into this ____ day of ____________, 20___, by and
between__________________________, hereinafter
referred to as VENDOR and Magical Management.,
a Florida corporation, hereinafter referred to as
MANAGER, the undersigned agree to the following
1. VENDOR is an EPA Certified firm for
repairs necessary in properties built prior to
1978. 2. VENDOR acknowledges and agrees to
follow the EPA Regulations in regard to
Renovate, Repair and Paint Rules for properties
built prior to 1978. 3. Only EPA Certified Lead
Based Paint Renovators will be allowed to fulfill
the maintenance and repair work requested
in/on subject properties and record keeping
rules. Copies of the records as required (by EPA)
will be provided to MANAGER upon request. This
agreement upon its execution by both parties is
herewith made an integral part of the
aforementioned Vendor/Broker Agreement. Executed
this ____ day of _________________,
20___ Vendor_______________________________ M
anager_____________________________
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69
The Rental Application It is a very good idea to
publish the application on you website. This
gives each and every prospective tenant an
opportunity to review and apply for your
available properties. Make applications
available In your office by fax On your
website by email In the properties Your
application should provide Disclosures Costs A
pproval procedures Selection Criteria Credi
t history Criminal background Landlord
verification Income verification
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70
Disclosure The Fair Housing Statement should be
in your application. It is illegal to
discriminate against any person because of race,
color, religion, sex, handicap, familial status
or national origin. Your local governments may
have additional protections. Find out! You must
post the 11 x 14 poster furnished by the U.S.
Department of Housing and Urban Development. It
is the law. Failure to display a Fair Housing
poster properly shall be deemed prima facie
evidence of a discriminatory housing
practice. Webster Dictionary legally
sufficient to establish a fact or a case unless
disproved ltprima facie evidencegt This small
sign with the words Equal Housing Opportunity
and logo is not enough.
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71
Costs State the following (if any) Amount of
application fees Holding deposit Lease closing
cost Condo or Homeowner Association fees Pet
application fees Outline how and when all moneys
are collected during the rental process and to
move into the property. If you require
negotiable funds state that in your application
paperwork.
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72
Approval procedures Upon receipt of the rental
application and fees we will Complete a credit
history check Check public records Verify your
income Verify your previous landlord
reference Complete a criminal background
check We may contact you for additional
information. NOTE If in checking your records
you do not meet our selection criteria manager
may request additional funds or a lease
guarantor. Once notified of approval You must
sign the lease within 48 hours of our notice to
you Pay an amount of money All initial funds
must be paid by cashiers check or money order
made payable to the company
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73
Resident selection criteria How much income
must the household generate? Incomes must be
verified in writing, will you accept pay
stubs? Self employed persons will be required to
provide tax returns Unemployed applicants must
provide proof of income Must provide a minimum of
2 years rental history Rental history must be
rated satisfactory or better. Do you use credit
scores? Policy on Evictions Foreclosures Shor
t Sales Felonies Guarantors must meet all
approval requirements and live in Florida
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74
Other issues to include in your application
paperwork When are keys released to the new
tenant When are rents due and what fees are
incurred when late Reporting condition defects at
move in Multiple applications Leasing
consultants Lead based paint disclosure for
houses built before 1978 As you process the
written applications you receive do not write or
make any notes on that paperwork. Have a
separate form for your notes. Once you have
completed your verifications and have made your
approval or denial decision you must notify the
applicants.
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75
Approval process or denial Pick up the phone and
call with Congratulations your rental
application for 123 Any Street has been
approved. Follow up with a letter or email. Use
consistent forms. NOTICE OF RENTAL APPLICATION
APPROVAL To Rental Applicants From Your name
here Magical Management Re 123 Any Street,
Orlando, FL 56789 Dear (applicants
names) Your rental application for the above
referenced property has been approved on the
__________ day of _______________, 20___. Your
lease must be signed on or before the
_____________ day of ______________,
20____. Please contact our company immediately to
arrange for the lease closing. Warmest
Regards, YOUR NAME HERE Magical Management
76
When denying a tenant I recommend you do not
engage in lengthy conversation. Try this
statement Based on our verifications of the
information you provided to us, we are unable to
rent to you at this time. You will receive an
adverse action notice explaining the reason and
how you can obtain additional information. Thank
you. The more you talk, the more likely it is
you may say something that the denied applicant
will use against you.
77
Tenant is denied
ADVERSE ACTION NOTICE DATE ____ / ____ /
_____ TO FROM ADDRESS ADDRESS We
regret to inform you that your application for
our rental unit at _____________________
__________________ has not been unconditionally
approved and we are taking the following adverse
actions APPLICATION IS DENIED WE ARE
REQUESTING A HIGHER SECURITY DEPOSIT THAN
NORMALLY REQUIRED WE ARE REQUESTING A QUALIFIED
GUARANTOR We are hereby informing you of certain
information pursuant to the Fair Credit Reporting
Act, 15 U.S.C. Section 1681, et seq. as amended
by the Consumer Credit Reporting Reform Act of
1996 (Public Law 104-208, the Omnibus
Consolidated Appropriations Act for the Fiscal
Year 1997, Title II, Subtitle D, Chapter
1). 1. We have not unconditionally approved your
application or we have taken an adverse action or
we have denied your application based on the
following Information contained in a consumer
credit report obtained from the consumer credit
reporting agency named in paragraph 2 of this
letter. This is not the entire form
78
The Lease Agreement There is no specific lease
in Florida that must be used by landlords or
property managers when leasing a residential
property. Each company may have their own
lease. Many property management companies
develop their own lease. Be careful! Real estate
licensees in Florida may only fill in the blanks
in the lease approved by the Florida State
Supreme Court. It is considered the unlicensed
practice of law for a licensees to fill in the
blanks on any other lease. Even if you had a
lawyer compile the lease for your use. It is a
simple process to send a form to the law office
and have them prepare the lease and send it back
to you. The law firm will place their name at
the end of the lease Prepared by the law firm
of Heist, Weiss and Wolk, P.A. This lends
credibility to your lease for both the property
owner and the tenant.
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79
After reviewing the lease agreement itself, you
realize that when you grant occupancy of a home
to another they inherit rights to the
premises. When you own a property you have four
rights to that property 1. Possession 2. Use 3. E
xclusion 4. Disposition When the property owner
grants a lease agreement to a tenant that tenant
receives the following rights 1. Possession 2. Us
e 3. Exclusion The only real property right that
is not granted in the lease agreement is the
right of disposition. The tenant cannot dispose
of (sell) or in any way transfer the property to
anyone, even through a sublet, without the
property owners written consent.
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80
  • Our state statutes and rules provide guidelines
    to determine who is responsible for maintenance.
    For instance, in Florida according to statute,
    the tenant must
  • A. Comply with all building , housing and health
    codes.
  • B. Keep the premises clean and sanitary.
  • C. Remove the garbage in a sanitary manner.
  • D. Keep all plumbing fixtures clean, sanitary
    and in repair.
  • E. Operate in a reasonable manner all electrical,
    plumbing , sanitary , heating , ventilating ,
    air conditioning and other facilities.
  • F. Not destroy , deface, damage or impair or
    remove any of the premises or property belonging
    to the property owner and cannot allow their
    guests to do so.
  • G. Conduct themselves and require
    others on the premises to conduct themselves in
    a manner that does not unreasonably disturb their
    neighbors
  • These statements may seem clear on their face,
    however, in practice they are broad, general and
    vague. Therefore, it is very important that the
    lease or rental agreement describe the tenants
    responsibilities.
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81
There are generally six requirements of a valid
contract (lease) 1. Agreement- which requires
offer and acceptance. 2. Considerations- money.
3. Capacity to contract- Must not be minor,
insane or intoxicated. 4. Genuineness of
Assent- intention of both parties when contract
was entered into. 5. Lawful purpose- must be
for legal use in order to be a valid contract or
enforceable contract. 6. Lawful Form- if the
law requires it to be in writing it must be. .
Only after all these requirements have been met
can a contract be deemed valid and legally
enforceable. A meeting of the minds is the most
important aspect.
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82
A lease describes the agreement between the
parties   Identifies the parties
  Dates   Amount of rent (consideration)   Outlin
es the intent of the agreement (meeting of the
minds)   Sets the terms and conditions as agreed
to by the parties involved   All signors must be
of legal age  
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83
In addition to the lease agreement addendums may
be necessary or that your company
requires Lease Addendum for roommates Pet
Addendum Non-Sex Offender addendum Mold addendum
(right to terminate lease) Guaranty of lease
addendum Drug Free Crime Free Addendum Lease
clauses Maintenance In the event a major
repair must be made to the premises which will
necessitate the LESSEES vacating the premises,
LESSOR, may at its option terminate this
agreement and LESSEE agrees to vacate the
premises holding LESSOR harmless for any damages
suffered, if any.
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84
Condemnation and Acts of God If for any reason
the premises are condemned by any governmental
authority, or damaged through fir
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