Pitfalls for Landlords

John Harcar (00:01.252)
Hey guys, welcome back to the show. I’m your host, John Harcar. We’re here today with Gail Boucher and we’re going to talk about some of the pitfalls she’s experienced of being a landlord. You guys here at Investor Fuel, we help real estate investors, service providers and real estate entrepreneurs, you 2 to 5X their business. And it’s allowing them to really build businesses they’ve always dreamed of and live life they’ve always dreamed of. So Gail, welcome to the show.

Gail Boucher (00:29.102)
Thank you.

John Harcar (00:30.276)
Awesome. I’m super excited to talk about, especially myself being a landlord and finding out some of the pitfalls that you’ve experienced and really being able to share these things with our audience for stuff they might want to look out for. Right. But before we get into all that, why don’t you tell us a little bit about yourself and how you got here.

Gail Boucher (00:52.782)
got here was an invite from you. And I’m not sure how you got my name. How did you get my name?

John Harcar (01:02.868)
I’m not sure. It could have been just, you know, maybe reached out to different investors or landlords or things in the area. I’m not exactly sure how your, your face you got across, but you know, I’m glad we have an opportunity to talk.

Gail Boucher (01:14.253)
So, and why I responded was I have gone through so many mistakes in being a landlady, because I’m not a landlord. And I don’t want other people who are interested in becoming a

John Harcar (01:32.644)
ladies yes

Gail Boucher (01:44.83)
property owner to go through the mistakes that that I’ve been through and hopefully they’ll they’ll really listen and heed my I don’t know if it’s advice or the problems that I went through and avoid them.

John Harcar (02:10.946)
Yeah, well, and that’s super helpful. know, nowadays when people get into things, they don’t really know what to look out for. It’s, you know, we’ve all had that lesson learned. And if people can avoid that, that’s going to be a benefit. tell us a little bit about how did you get into real estate? You gave me you told me an interesting story about your father earlier. So how did you get into this real estate game?

Gail Boucher (02:32.254)
Well, my father, my father was a go-getter and my father was a really smart guy. In fact, I’d love to tell the story of my dad who, he graduated from the eighth grade, that’s as far as he went. And I have like four degrees, I have three advanced degrees. So I am not a genius, I’m smart.

John Harcar (02:51.556)
Hmm.

John Harcar (02:55.908)
Wow.

Gail Boucher (03:01.342)
but I’m not a genius. And we took the same like IQ test. He scored higher than I did. Yeah, he is just, he’s an avid reader. So he learned like in his twenties that the best way to make money was like you called it house hacking now. Well, he probably

bought his first three-family house when he was in his 20s.

And he, except for a couple of years when he had a single family home, he always had some sort of a rental. And I had the opportunity to buy his house at the only time in my life that I could buy a rental.

John Harcar (04:07.118)
Mm.

huh.

Gail Boucher (04:11.561)
I jumped on it. That was in 2007 when I was in my 40s. So it’s never too late to buy.

John Harcar (04:23.808)
No, it’s, know, yeah, well, in real estate, real estate’s always been a good vehicle, you know, for people to generate income. And I like the whole house hack idea. And it sounds like he was maybe one of the first people to come and do it back then, huh?

Gail Boucher (04:25.0)
Income, know, rental property.

Gail Boucher (04:41.544)
Probably. That was,

in the fifties.

John Harcar (04:48.024)
So what is your real estate business look like currently?

Gail Boucher (04:52.642)
have four turnkey properties in Memphis, Tennessee.

John Harcar (04:58.24)
Memphis, Tennessee, why did you choose Memphis?

Gail Boucher (05:02.79)
There is a…

Gail Boucher (05:09.801)
It’s called bigger pocket. You know bigger pockets?

John Harcar (05:12.6)
Bigger pockets, yeah. Yeah, definitely the podcast, the website, yeah, for sure.

Gail Boucher (05:19.105)
And I…

I bought my dad’s property for $230,000, $20,000. And I was going to sell it anywhere between $550 and over $600. I ended up selling it for $640,000.

John Harcar (05:47.556)
Wow, congratulations.

Gail Boucher (05:49.285)
And there’s this little thing called capital kings.

John Harcar (05:52.792)
Capital gains.

Gail Boucher (05:56.045)
And it was going to cost me $100,000 in capital gains. And there was no way I was going to pay $100,000 to the government in capital gains. Are you familiar with what’s called a 1031 exchange? OK. So do you want to explain?

John Harcar (05:59.268)
100 at least

Yeah.

John Harcar (06:09.954)
What did you do?

John Harcar (06:18.597)
of course. Yeah, yeah, yeah, definitely.

Gail Boucher (06:23.686)
1031 exchange to your.

John Harcar (06:25.412)
It’s just basically buying something that’s equal or greater value than what’s the property you’re selling.

Gail Boucher (06:31.716)
Right. So.

John Harcar (06:33.614)
to avoid a deflate or defer capital gains.

Gail Boucher (06:36.401)
Yeah. So there was a guy that I dogged out in bigger pockets. And he said, you know, there’s this woman that I know that does 1031 exchanges and get in contact with her. And like,

kept looking at other people and I always went back to her. And then she got in touch with a guy named Robert Fio. And I highly recommend, and I always forget the name of the book, but if you look up Robert Fio, his last name is F-E-O-L. He wrote a fantastic book.

John Harcar (07:29.917)
F E O L

Gail Boucher (07:33.159)
about how you buy.

property and go out and buy it today because he really has a handle on buying properties.

John Harcar (07:50.486)
Now, in regards to buying properties, is it like a negotiation type of book? Is it an evaluation of property type of book? mean, how does it help someone buy properties?

Gail Boucher (08:01.83)
It tells them how you negotiate. It tells you don’t buy properties that are less of value than market.

And if you have to fix them up, fix them up. If they’re in foreclosure and they look fairly good, buy those kind of properties. Don’t place market value on any property that you buy.

John Harcar (08:37.824)
Is this a book that you can contribute your kind of guidance in real estate to?

Gail Boucher (08:43.396)
Absolutely. Actually, I read it after I met Robert, but I highly recommend it. Robert Kiyosaki, yeah, he wrote Rich Dad Poor Dad, and that’s another great book that I would recommend.

John Harcar (08:55.406)
Kiyosaki. Yeah.

Gail Boucher (09:11.574)
I think that if you go out and buy top of the market, it’s not great. You can buy real estate at reasonable values, especially if you’re handy. If you’re handy, wow, I’m not handy.

I’m 71. I’m going to be Actually, I’m going to be 71 next Wednesday.

John Harcar (09:41.024)
No. God bless you.

Well, or happy early birthday. Yeah, God bless you.

Gail Boucher (09:48.587)
Thank you. But if you can find a handyman and get in partnership or handywoman, because there are a lot of handywomen out there, and get in partnership with them, that’s golden.

John Harcar (10:02.51)
Yeah.

John Harcar (10:11.938)
Well, that’s the goal, right? Is to buy properties at a discount, right? And then if you have to put a little bit of work into them or things like that, then get that. But you’re right. mean, it’s a credible tool for folks to have as someone who’s I mean, bottom line.

Gail Boucher (10:24.636)
And, and,

And so, you know, that’s one of the ways that you…

you really develop wealth. I kind of started late in the game, but…

I did.

John Harcar (10:47.157)
Now, do you have a team or is it just you that buys properties? mean, do you actively market? I mean, what does your business look like right now?

Gail Boucher (10:55.464)
Well, my team is Robert’s team right now. And basically, I have all of my money in Robert’s team.

John Harcar (11:09.262)
Got it. So you’re invested with him and he’s bringing properties to you?

Gail Boucher (11:14.591)
He brought the four properties to me. However, I’m making, when all is said and done, I’m probably gonna make about $4,800 on those four properties.

John Harcar (11:32.738)
That’s it?

Gail Boucher (11:34.963)
That’s it.

John Harcar (11:36.418)
Why so low? Like why so little for four property? mean, 1200 bucks of property?

Gail Boucher (11:45.246)
Well, that’s not bad for rental properties in Tennessee.

John Harcar (11:51.46)
No, you’re $4,800 a month? Oh, oh, oh, oh, oh, I thought you kind of said in total you were going to get $4,800 for all those, all I’m like, wait a minute, wait I thought you meant sell them, you’re only going to make $4,800, but you’re getting, $4,800 a month is not bad. And I mean, what’s your monthly costs?

Gail Boucher (12:04.455)
no no no.

Gail Boucher (12:09.661)
That’s with my monthly cost.

John Harcar (12:11.044)
Oh, is. Oh, okay. Well, Well, cool. Are you looking to go out and buy more?

Gail Boucher (12:17.998)
Gail Boucher (12:23.325)
One of my problems is that I don’t have a score over $700. So it’s… Yeah. Yeah. And these people who say, I can teach you how to get a loan. I can teach you how to do something with 0 % down and, you you know anybody who’s done that?

John Harcar (12:31.842)
Hmm. And why is that important for the lending? Yeah. Yeah.

John Harcar (12:50.488)
Mm-hmm.

No.

Gail Boucher (12:54.653)
No. So don’t buy into their, you know, and don’t pay $5,000. Don’t pay $10,000, $15,000, you know, because you’re going to get ziplock from them.

John Harcar (13:07.62)
Mm-hmm.

John Harcar (13:16.45)
Well, there are a lot of, I don’t want to necessarily say shady, but you know, maybe not fully effective methods out there. what, so besides the credit, what’s your biggest challenge, other biggest challenges as far as growing your business or growing your portfolio?

Gail Boucher (13:48.284)
71. So, you know, 71 years young. So I think that that’s a big challenge. I live in Massachusetts. So I don’t necessarily want to buy in Massachusetts the way that it leans towards

John Harcar (13:50.02)
Okay, well, 71 years young.

you

John Harcar (14:17.732)
towards tenant rights.

Gail Boucher (14:18.787)
The tenant is horrible.

John Harcar (14:25.548)
Now these four turnkey properties you have, you said they’re in Phoenix. Are you using a property management? they’re in Tennessee, I’m sorry. Are you using a property management? Okay.

Gail Boucher (14:30.747)
Tense. Tense.

Absolutely. Robert does it all.

John Harcar (14:37.986)
Robert does it all, okay, and this is Robert Field. Yeah, yeah, okay, so you basically give him the money, he finds the properties, he provides all the, he basically does all the turnkey stuff and just sends you a check. So you’re basically kind of a lender. Yeah, okay.

Gail Boucher (14:40.549)
feel.

Gail Boucher (14:51.418)
Yeah. Although one of the things that I did was they had an insurance company. because I’m a vet, I get to use USAA and I saved a ton of money. So if you’re a vet and you haven’t used your veterans loans, look into that.

John Harcar (15:02.852)
Mm-hmm.

John Harcar (15:09.294)
Did you?

John Harcar (15:19.35)
Mm-hmm. Now, I’m not a veteran, unfortunately, but thank you for your service.

Gail Boucher (15:24.249)
But maybe some of your listeners are that.

John Harcar (15:27.952)
I’m sure. Yeah, I know. that’s great. That’s great knowledge. mean, and and we’ve had and I’ve had some folks that I’ve worked with before that. Yeah, they’re kind of the same stance. If you’ve got those options to use the military loans, use them. It’s a shame not to use them.

Gail Boucher (15:41.88)
Yeah, I mean sometimes they’re more expensive than other loans, but sometimes they’re not.

John Harcar (15:48.174)
Mm-hmm.

Gail Boucher (15:57.689)
I have a couple of years before I can.

Gail Boucher (16:06.369)
Get alone. Uh-huh.

John Harcar (16:09.814)
certain amount of time, there has to be a certain amount of time in between. Yeah.

Gail Boucher (16:12.92)
Yeah. And one of the things that, you know…

Both Robert Kiyosaki and Phil doesn’t necessarily advocate is refinancing, cash out refinancing.

John Harcar (16:24.772)
Kiyosaki. Yeah, Kiyosaki, you said it right.

John Harcar (16:34.776)
Mm-mm. Mm-mm. They don’t.

Gail Boucher (16:36.855)
Yeah, neither one of them does because it costs a lot in the end.

John Harcar (16:41.198)
Well, exactly. you’re taking our equity. You’re paying too much for that equity, is what it comes down to. Yeah. So let’s talk about…

Gail Boucher (16:47.159)
Yeah, so that’s good thing for your listeners to hear.

John Harcar (16:53.196)
That’s a great thing and you have a lot of great knowledge and I love the nuggets. So let’s talk about some of these pitfalls to avoid, right? So we started off, yeah, myself, I guess I’m a landlord. know pitfalls I’ve recently run into. I have a terrible property manager who I had to let go. You know, there’s just all these different things that you don’t.

Gail Boucher (16:59.897)
Ha! It falls to a boy.

John Harcar (17:16.076)
know are gonna come up unless you’ve looked for them or you know to look for them. help our audience understand kind of what are some things that, know, if I’m gonna become a landlord, what do I need to know?

Gail Boucher (17:29.175)
Your tenants aren’t your friends. They are your tenants.

John Harcar (17:36.004)
That’s funny you say that. I ran into that situation with my last 10 prior to this one and it’s more difficult to let them go. So what experience have you had with that?

Gail Boucher (17:50.545)
so many. Uh-huh.

Gail Boucher (17:58.037)
When you think that you’re their friend, they take advantage of you.

and they think that they can do anything. For instance, my dad, there was this guy who completely took over the property.

Gail Boucher (18:29.629)
When I think that you’re their friend, they…

do whatever they want.

John Harcar (18:41.358)
Give an inch, take a mile.

Gail Boucher (18:42.942)
Give an inch, take a mile.

don’t necessarily have a friend be your property manager.

John Harcar (18:56.74)
Heard that pitfall before?

Gail Boucher (18:58.372)
even though they may charge less.

Gail Boucher (19:07.417)
If they’re one day late

Gail Boucher (19:14.47)
In Massachusetts, you have to give them a 14-day notice to quit. On the second day, you give them a 14-day notice to quit.

John Harcar (19:23.064)
Give him that.

Have you ran into any situations to where someone got that and they’re like, okay, well fine, we’ll just get out of here.

Gail Boucher (19:33.179)
No, they don’t make it out.

John Harcar (19:35.064)
Yeah. Some people are afraid to do that. That’s why I mentioned that is some folks are afraid to say, hey, you know, I’m going to I’m going to put the fire to my tenant because they don’t want to do it because they’re afraid they’re going to lose that income, that tenant. Right. And they’re going go through the whole process. But if you don’t do that, then it doesn’t show that, hey, look, I’m the boss.

Gail Boucher (19:36.499)
You give them a 14th.

Gail Boucher (19:49.739)
yeah, I just got-

Gail Boucher (19:58.772)
I had a couple that I had to wait a month.

before they can move in. If I had waited that month, I probably would have had that tenant forever. And they would have been a great tenant.

John Harcar (20:19.63)
Really.

Gail Boucher (20:25.735)
I had, my parents and I had a tenant for 20 years. And somehow…

The way that my father had done the electricity, they ended up paying for the whole house of electricity, which was like $20 a month.

John Harcar (20:52.691)
Mm-hmm.

Gail Boucher (20:54.256)
and I had owned the house for like…

Ten dollars a month, something like that. And I had to the house for like three years. And she said, you owe me six hundred dollars. And I said, I don’t owe you six hundred dollars.

John Harcar (21:01.124)
Mm-hmm

Gail Boucher (21:12.21)
And because I wouldn’t pay her $600, after 20 years, she moved out.

Gail Boucher (21:25.643)
Don’t have families move in.

John Harcar (21:31.204)
Don’t have fam, like your family or families as a whole? with kids. okay. Yeah, no tenant relatives moving in.

Gail Boucher (21:33.745)
families, you know, my sister wants to move in. Is that okay? No, no, no, no. No tenant relatives moving in. You know, one cousin took a hammer to the other cousin.

John Harcar (21:48.611)
What are some?

John Harcar (21:53.636)
Talk about some family problems.

Gail Boucher (21:57.179)
Yep.

John Harcar (21:58.338)
What are some resources and tools you think that someone can use to, or maybe you’ve used to find good tenants or screen tenants better?

Gail Boucher (22:06.235)
hoaries.

John Harcar (22:07.95)
Quarries? C-O-R-Y-S?

Gail Boucher (22:12.065)
No, C-O-R-I.

Gail Boucher (22:19.736)
It’s a background check from the police.

John Harcar (22:25.902)
Okay, and it’s available to the public? Okay.

Gail Boucher (22:28.378)
Yeah, I don’t know if it’s a national thing, but I think it’s a national thing. In Massachusetts, and I’m not sure if it’s around the country, but you can look up if a tenant has gone through the system and had evictions.

John Harcar (22:47.668)
wow, I’ll to check that out. I’ve never heard of that quarry, but this is a good background screening tool.

Gail Boucher (22:53.232)
It’s a background screening tool.

John Harcar (22:55.223)
Okay.

Gail Boucher (22:58.402)
You go to the last landlord and the landlord before the last.

You know, call up the person’s employer.

How long have they worked there? Get a pay stub, you know? Well, I charge $2,000 a month for my apartment.

John Harcar (23:24.248)
Yep, that’s important.

Gail Boucher (23:36.143)
That’s $24,000 a year. If you’re not making $40,000, you can’t afford it.

John Harcar (23:42.884)
Right? Right? Well, and I think that’s not what I think. Those are some minor steps that are very valuable for our listeners to hear is that, you those are the little things that really need to make sure that you, you, you cover and you know, do the old CYA, right? Cover your, know what? Make sure that they’re capable and they’re, they’re, they’re willing. What other advice would you give? We’re going to run it, wind it down here. But what other advice would you give to someone who

Gail Boucher (23:44.719)
You know?

John Harcar (24:10.052)
you know, thinking about getting into the landlord game that you’ve experienced.

John Harcar (24:18.124)
or Landlady game.

Gail Boucher (24:22.1)
Make sure that you get a security deposit, whether it’s over time or right away. Because if you don’t, they leave their garbage, they leave anything that they don’t want, and you end up with all of it.

John Harcar (24:47.616)
And I think it’s important to, to when you do do that deposit to lay it out that, Hey, look, if this situation happened, this will all come out of the deposit. If trash is left. think if you don’t, you don’t lay that out to them before, right? They’re going to, you know, when at the end they’re going to say, well, you never said that. So besides the fact of getting into a deposit, I think it’s really important to really outline what that deposit is going to cover. Yeah. Put it all in escrow. Yeah.

Gail Boucher (25:10.667)
Yep, we put it all in escrow. I never did that. We put it all in a separate account and put it all in escrow. Because if you don’t, a really bad tenant…

John Harcar (25:19.684)
cool.

Gail Boucher (25:24.973)
They’ll bite you in the rear end.

John Harcar (25:27.704)
Mm-hmm. 100%. 100%. Okay. Well, Gail, I I appreciate you joining us today. If someone watches this and they want to get a hold of you and talk to you a little bit more about some other things that you said or you experienced, how do they reach out to you?

Gail Boucher (25:41.943)
well, you want my phone number?

John Harcar (25:47.012)
You don’t have to give, if you wanna, you know, just maybe give a website, an email address, anywhere they can get ahold of you, you can do that. We can put it in the show notes.

Gail Boucher (25:56.142)
Well, my email is mysaxifrageatgbail.com

John Harcar (26:14.5)
We’ll put that in the the in the subject notes. I don’t want to put your phone number out on the internet. So if they reach out to you, they’ll they’ll shoot you an email. But you know, I definitely appreciate your time here today, Gail. You know, guys, I hope everybody enjoyed, you know, what Gail shared as far as pitfalls to look out look out for. We know landlording or landladying does have its, you concerns and things you got to make sure you really, you know, dot your i’s and cross your t’s. So Gail, thank you very much and enjoy enjoy your afternoon. Okay.

Gail Boucher (26:19.16)
Yeah.

Gail Boucher (26:44.142)
Thank you. Bye.

John Harcar (26:45.048)
Thank you. Bye bye.