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Growing Your Property Management Business

Short clips, class excerpts and archive recordings from the TPM library.

148 lessons 19h 58m of video 3 modules

Taught byRobert M. Locke, RMP®, MPM® & Monica Gilroy

Read the full transcript

Introduction to Liability

Well, greetings. I'm Robert Locke, and thanks for taking the time to watch this video. The conversation we're going to have today is exposing the hazards of a resident rewards package. There's a lot of trainers out there, and vendors included, who are pushing people toward doing a resident rewards package without really thinking through some of the additional liability that comes with that package. Property managers are being exposed to litigation that they didn't think through.

And the purpose of this video is to think through that granularly, try to give you some answers and alert you to some things that might come back down the road to bite you. And we don't want that to happen. So I've engaged my friend, Monica Gilroy, who's a lawyer, to help me do this, because this is the legal side of the property management business, and it has to do with exculpatory language and limits of liability and stuff like that. So I thought she'd be the right person to bring in.

Expert's Background

Now, Monica's in litigation. What that means is she spends 20%, 30% of her time in front of judges and juries, arguing about liabilities and disclosures and exculpatory language and things that, kind of the battleground of where we are in the property management industry. And so she's the right person to tell us where's the liability, what's this going to look like in court, and what language might we need to eliminate or at least reduce that liability. Now, she is all about real estate and fair housing and property management. She's the general counsel for the Atlanta chapter of NARPM.

She's the go-to person for national NARPM on fair housing and litigation issues. So she's been around this industry for about 20 years and has handled an awful lot of litigation with property managers. So she's the one that we should lean into, not just any lawyer out there. We should lean into Monica, who knows what it's going to look like when you get to court, because she'll help you write really good documents to protect you.

Purpose of Video

So here's what we're going to do today. We're going to talk through where's the liability and how to remove or at least limit that liability. That's the focus of this conversation. It's about protecting yourself. It's about body armor.

So it's about things you and I can do to protect ourselves against disgruntled owners, tenants, vendors, and some of the pushback that we may get from a resident rewards package. Now, we're not doing this in a void. We understand that these series of videos are going to be about exposing the hazards. And in the end, we're going to direct you to a document that Monica created called "Bulletproofing Your Company Against a Badly Designed Resident Rewards Package." And it's a document you can download on our site, and it'll give you the language you need. You can literally copy and paste language into the various documents that you need for a resident rewards package that gives you all the exculpatory language and the disclosures that you need to protect yourself from the hazards that we're going to be talking through.

So we're going to jump right into it. I'm going to slice it up into pieces. And what I did was shoot some Zoom videos with Monica. So part of this is you're going to see conversation between Monica and myself. You want to listen to her more than you do me, okay?

Because she's the one that's going to maybe be defending you someday in court over some of the backwash that you might get if you don't pay attention to the answers that we are going to address here. So let's jump right into it.

Disclosing to Owners

The first one is disclosing to owners. Now, there's certain language that you might want in your property management agreement to disclose the fact that you're going to make money on selling services to your tenant. So let's listen to Monica's response to this and let's glean from her, okay? Here we go. Now, this particular video is about adding language to the management agreement to disclose to the owner what the manager is doing.

That is, getting permission from the owner, so to speak, to sell services to the tenant. So Monica, are you there? Hey, Robert. How are you? Good afternoon, Monica.

How are you doing today? I'm doing great, Robert. So happy to be here and really excited to talk today with our friends, so happy to have you lay out the problem and we can just tease it out together. Okay, good. What is happening in the industry, Monica, is that people are building resident rewards packages.

They don't always understand some of the hazards that are involved in them. And by not adding some liability of themselves, they want to build a system that they can sell benefits to their tenants. Now, it's not the benefit package that creates the liability so much as it is how they build it, how they set it up. So we've broken this down into 10 different messages. So let's get started with dealing with the owner side.

So the question we want to answer in this video is how do you handle disclosures to the owner on the resident rewards package? In other words, what might we do to disclose to the owner in the management agreement the issue of the resident rewards package? Great question. Most managers I would say we deal with, Robert, really don't feel that it's necessary to involve the owner or inform or disclose to the owner about the residence reward package for a couple of reasons. One, well, there's just no need really to put it into a property management agreement, a PMA, because the owner isn't paying for it, right?

It's not something that they're putting money out to do. And then number two, nor are any of the fees that are generated by it coming to them. That's something that certainly most of my clients, and the ones that you consult with as well, are under the model that the rent will go to the owner and the fees will go to the property manager. So to me, the resident rewards package is very much within the realm or the world of the property manager, such that there's really not a whole lot you need to disclose to your owner. Okay.

So as far as you know, license law, landlord-tenant law, have you seen any legal requirements to landlords that they would have to disclose something like this? I've never read any. Have you come across any? Yeah, I have not, because if you think about it, this is really a marketing sort of concept. This is a way to draw tenants into a certain property that the property manager does.

So no, I wouldn't think this is something that needs to be disclosed. And in fact, in my mind, I would not even have it be part of a property management agreement. Yeah, you convinced me of that 15 years ago when we were doing it. I agree with that, and we used it for years, never said a word in the management agreement about it, and nobody ever cared. Nobody brought it up.

However, there are some managers out there that feel differently, and maybe they're a little more paranoid with people. They're like, every part of their business and all the operational side of their business, they have to somehow tell the owner what they're doing. So for those listeners who kind of feel that, give me some of the rules. Tell me some of the limitations. How would you go about it if a manager came to you and said, "I really think I need to say something in my management agreement." How would you respond?

Sure, absolutely. Well, my rules are pretty clear. Number one, you want to just first and foremost, keep it very brief. The shorter, the better. That's a cardinal rule of mine is just say what you mean and say it concisely.

Number two, you don't need to go into any type of detail about what comprises the package, because as we know, package could morph over time, and you certainly don't want an owner thinking, "Well, wait a minute.

Management Agreement Conciseness

Locke told me they were going to be having this aspect of it," and then suddenly, because the manager decides not to, they don't. So to me, it's just really, number one, very concise, one sentence, no explanation, and two, no details as to what it's going to be comprised about. Yeah. Recently, when we've had a couple of managers want language like that, you put a document together, and we kind of, to give the manager the language to use in the management agreement. I think you did it in one sentence or maybe two.

So you wouldn't want to put any details because the resident rewards package will grow and morph and change- Exactly ... and modify over time. So you don't really want to say very much in the management agreement. Exactly. Now, just for our viewers' sake, as we go through this, we're going to draw out some concerns.

But Monica has created a kind of a legal document. It's kind of a white paper on what language would you put in the management agreement, to satisfy a manager in terms of disclosure to an owner, and each of the different hazards that we talk through, there's in this document that Monica has created, and we'll tell you where to find it. You can get all the language, all the legal language you need to satisfy this concern. So we'll tell you a little bit more about that as we go along.

Monica's Advice

Okay, now what Monica says is, first of all, she doesn't think you need to. I didn't through 10 years. We were doing 30, 40, 50 move-ins a month. That's 100 applications plus a month in the last eight or 10 years of our business. We didn't say anything in the management agreement about a resident rewards package, but not everybody agrees with that kind of thing.

There are some people that think every nickel they make in the property management business, they got to tell the owner about and expose it to the owner and have a discussion with the owner about who gets that money. So everybody kind of feels differently about this kind of thing. So I don't think you need to. Monica doesn't think you need to. You'll make that decision for yourself.

If you do, keep it brief. In other words, in the management agreement, Monica's narrowed it down to one or two sentences on what to say in the management agreement to keep it brief and give no details whatsoever. So that's Monica's advice. Let's kind of pause for two seconds, and then we'll move on to number two.

About the speakers

Monica K. Gilroy Esq.

Real estate litigator, The Gilroy Firm

Founding principal and managing partner, The Gilroy Firm
J.D., University of South Carolina School of Law, 1993; B.A. Political Science, University of Wisconsin, 1990
Named a Top 50 Woman Attorney in Georgia
Past Chair, Real Property Law Section, State Bar of Georgia
Outside national counsel to NARPM and General Counsel of its Atlanta chapter
American Land Title Association (ALTA) National Education Committee since 2014
ALTA National Title Action Network (TAN) Chair since 2020; ALTA National Title Professional designation
AV peer review rating, Martindale-Hubbell
Peer-nominated Georgia Super Lawyer in real estate since 2008
Hundreds of jury trials, bench trials, arbitrations and mediations; licensed arbitrator and mediator; Special Master in Fulton County

Robert M. Locke RMP®, MPM®

Property management trainer and consultant

Residential Management Professional (RMP®) designation, 1998
Master Property Manager (MPM®) designation, 1999
Led Crown Management to the Certified Residential Management Company (CRMC®) designation, 2000
Founded Crown Management in 1980 and grew it to over 1,000 single-family homes under management
Sold Crown Management in 2015 to a Fortune 500 company
Past president and board member, Atlanta chapter of NARPM
Certified instructor, National Association of Residential Property Managers
Georgia Association of Realtors Partner in Education (PIE)
Expert witness on real estate disputes in magistrate, state and federal courts
Licensed in real estate since 1973; B.A. in Business and Marketing, Michigan State University, 1969

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What this course covers

Exposing RRP Hazards 12 lessons
Class 3 3 lessons

Short clips, class excerpts and archive recordings from the TPM library.

Curriculum

Exposing RRP Hazards12 lessons · 1h 29m

Intro, Disclosing to Owners Free 10:26
Language for Your Website Locked 3:41
Language for the Application Locked 8:20
Official Notice of Approval Locked 1:40
Language for the Lease Locked 14:34
Never Attach the RRP as a Lease Exhibit or Addendum Locked 5:38
No Signatures Locked 7:52
Never Name an Outside Vendor in Your RRP Locked 7:48
Always Include Exculpatory Language in Your RRP Locked 5:22
Consider Multiple RRPs for Different Tenant Groups Locked 9:17
Don't Load Your RRP With High-Priced Services Locked 2:56
Eliminate Bad Reviews Locked 11:21

Class 33 lessons · 1h 29m

Lesson 1: Who Should Make Decisions Locked 25:37
Lesson 2: Limited Power of Attorney and Authority to Lease Locked 12:17
Lesson 5: Emergencies and Firing an Owner Locked 50:56

Recordings and extras133 lessons · 17h 0m

NRT Sale Intro: Welcome to TrainingPropertyManagers.com Locked 3:31
Manual or Automated Reporting, Part 1 Locked 10:50
Manual or Automated Reporting, Part 2 Locked 6:06
Things You Don't Put in Your Agreements, Part 2 (94-Min Class) Locked 93:53
Service Business Terms (17-Min, Chapter 5) Locked 17:27
Stips 24 and 26: Ownership Locked 5:08
Robert Gilstrap Uses Crown Documents Locked 0:07
The Cost of a Vacancy Locked 14:12
The Property Management Lifecycle Locked 14:05
The Structure of PM: What Does Property Management Look Like? Locked 13:01
Dave Holt Recommends Robert Locke (Maui) Locked 2:38
Ownership Doesn't Mean the Right to Decide Locked 11:23
Robert Gilstrap Recommends Monica Gilroy Locked 0:33
BBB: From C-Minus to A-Plus Locked 8:55
Comfort Pet Certification Locked 7:05
Economic Generator Locked 6:25
Mark Spain Recommends Crown for Property Management Locked 0:17
Service Business Terms (11-Min) Locked 11:12
What One Event Quiz Locked 6:41
PM Style: Should the Owner Be on the Lease? Locked 10:30
Workshop Homepage Video Locked 2:40
My Big Mistake Was Treating PM as a Sideline to Sales Locked 2:26
OnSight PROS Training Video (46-Min) Locked 46:28
Robert Locke Biography Locked 4:27
We Use Crown Docs 1: Barton, Gilstrap and Teressa Locked 0:41
We Use Crown Docs 2: Lynne, Reid and Sally Locked 0:40
We Use Crown Docs: 5 People Locked 0:56
What If You Could Find a Veteran Property Manager Locked 1:23
What If You Could Make Big Money in Property Management Locked 1:20
When to Use State Association Forms Locked 5:59
EcoQuest Locked 5:24
Customized Rental Agreement Product Video Locked 5:18
Kristi Malcolm (PMI) Recommends Crown Forms Over State Forms Locked 0:54
OnePoint Service Group by Ken Jennings Locked 1:11
OnePoint Service Group by Robert Locked 1:24
Kittredge Garren Recommends Robert Locke's Classes Locked 0:49
John Bradford Recommends Robert Locke Locked 1:35
Robert Locke on Todd Breen Locked 1:00
Four and Half Recommended by Robert Locke Locked 2:11
Todd Reid Recommends Crown Documents Locked 1:10
We Use Crown Docs: Gilstrap, Teressa, Barton and Reid Locked 0:56
Two Strategies to Be Scalable Locked 9:11
Why Listen to Us Locked 11:58
Motherload: Products and Services Page Locked 5:06
Brian Birdy Recommends OnSight PROS Locked 0:50
Matt Manaker's Shout-Out to Robert Locked 1:08
Monica Gilroy Licensed Robert to Sell Her Legal Docs Locked 1:19
Robert Locke Recommends OnSight PROS Locked 0:58
Class 2: Monthly Management Fee (No Tag Videos) Locked 10:39
How and When to Fire an Owner Locked 28:10
NARPM: Evictions Locked 12:53
Why Do Managers Shift Over Time? Locked 9:14
1a Commissions: Procurement Fee Locked 10:24
Adding a Property to an Existing Agreement Locked 3:04
Ancillary HOA Disclosure Locked 4:50
Entity Declaration and Data Page Locked 4:09
Home Warranty Disclosure Locked 4:38
Modification of Agreement Locked 2:42
Multiple Owner Declaration and Data Schedule Locked 3:06
NARPM Primary Brand Clip Locked 0:08
NARPM Transitions (One Second Each) Locked 0:29
Power of Attorney (Multiple Owners) Locked 4:03
NARPM Short Clip Locked 0:03
Document Creep (New, Oct 2018) Locked 18:03
Entity Docs Locked 14:48
Five Filters for Assessing PM Agreements Locked 19:51
NRT and Subscription Options Locked 6:42
Owner Declaration and Data Schedule Locked 4:17
San Diego 2018: NARPM Class Follow-Up Locked 1:21
Ancillary Documents (Lease Side) Locked 20:23
Copyright Your Documents Locked 4:34
Just Because It's in Writing Doesn't Make It So Locked 14:50
Rules for Forming an LLC Locked 36:28
Copy for the Cover Letter Locked 9:42
Unenforceable Terms in the Lease Disclosure Locked 10:43
Our Core Value Ad Locked 15:54
Get a Document Review Locked 15:48
How to Find the Best Documents for Rentals Locked 12:41
Number One Enemy of Scalability Locked 18:32
Solving Bad Reviews Forever Locked 8:24
Credit 2 Reworked: How the Service Works (Detailed Version) Locked 18:38
How We Used POT to Influence Tenants Locked 0:53
Interrupter Video Locked 0:23
What If You Could Find a Veteran Property Manager? (With Interruption) Locked 2:39
10 Ways Lawyers Complicate the PM Business Locked 10:33
10 Ways Lawyers Complicate the PM Business, Part 2 Locked 5:05
Rent Modification Agreement and Procedure (With Monica Gilroy) Locked 14:54
The Challenges of Converting a Tenant's Security Deposit to Rent Locked 10:24
A Case for a Short Lease Document (With Monica Gilroy) Locked 15:32
DKRentals.net Todd Reid Brand Clip, Take A (10 Sec) Locked 0:10
DKRentals.net Todd Reid Brand Clip, Take B (8 Sec) Locked 0:08
DKRentals.net Todd Reid Brand Clip, Take C (9 Sec) Locked 0:09
DKRentals.net Todd Reid Brand Clip, Take D (10 Sec) Locked 0:10
DKRentals.net Todd Reid Brand Clip, Take E (7 Sec) Locked 0:07
DKRentals.net Todd Reid Brand Clip, Take F (9 Sec) Locked 0:09
DKRentals.net Todd Reid Brand Clip, Take G (8 Sec) Locked 0:08
DKRentals.net Todd Reid Brand Clip, Take H (8 Sec) Locked 0:08
DKRentals.net Todd Reid Brand Clip, Take I (12 Sec) Locked 0:12
DKRentals.net Todd Reid Brand Clip, Take J (7 Sec) Locked 0:07
DKRentals.net Todd Reid Brand Clip, Take K (7 Sec) Locked 0:07
Introducing the Official Notice of Approval Locked 14:42
How to Eliminate Bad Reviews Forever Locked 6:05
Why Engage Monica Gilroy (With Contact Info and Gilroy Firm Brand Ending) Locked 8:20
Training for Reputation Management: Eliminating Bad Reviews Locked 8:38
Who Convinced Us to Charge Tenants for Filters? Locked 16:37
Why Pay for Something You Can Get for Free? Locked 17:22
Filters Delivered Ad Locked 2:09
How to Provide Tenants a Year's Supply of Filters Locked 7:57
Don't Get Bundled: A Warning About Resident Benefit Packages Locked 12:44
How to Provide Tenants a Year's Supply of Filters Free Locked 8:37
How Much Do I Pay for Full Reporting? Locked 7:51
Why You Should Do Positive-Only Reporting (Tongue-in-Cheek) Locked 7:16
Why Embrace a Co-Signer Program Locked 5:28
How Do I Know for Sure That My Reporting Service Is Full Reporting? Locked 8:25
Meet Cubic Zirconia: Partial vs. Full Reporting Locked 3:47
Two Ways to Motivate Someone: Carrots and Sticks Locked 6:43
What to Do When the Owner Fails to Respond Locked 5:10
Responding to Disputes Locked 9:23
Getting the Owner to Release the Account Locked 5:20
Payment Agreements (831) Locked 6:31
Updating Tenant Ledgers Locked 9:24
What Documents Do You Need to Archive? Locked 7:05
I Want This Process to Be Fully Automated Locked 8:00
Time Is Running Out: Old Debts Are a Diminishing Asset Locked 6:25
Don't Worry About What the Judge Is Going to Approve Locked 5:59
It's Slipping Away: Old Balances Are a Perishing Asset Locked 4:54
How to Avoid a Fair Housing Claim When Pursuing Post Move-Out Balances Locked 4:37
What Involvement Does the Manager Have? Locked 8:31
Experian and RentBureau Reporting Locked 6:08
Ancillary Docs (Module 4) Locked 6:18
Entity Docs Module 5: Validating Who Controls Title Held in an Entity Locked 7:00
Crown Investor Institute Money Machine Video (Short Clip) Locked 0:14
John Bradford Recommends Robert Locke at Training Property Managers Locked 0:58

Robert M. Locke, RMP®, MPM®

National property management trainer and landlord-tenant litigator. Built Crown Management to 1,000 houses and sold it in 2015 to a Fortune 500 company.

Monica Gilroy

Real estate trial lawyer, general counsel for NARPM’s Atlanta chapter and frequent NARPM speaker. Twenty years co-developing these documents and courses with Robert.