Mat Zalk is the President and Property Manager at Keyrenter Property Management which has offices in Tulsa, Oklahoma City, and Arkansas. He focuses on the acquisition and management of single and multi-family residential properties on behalf of himself and a small network of investors.
Before founding Keyrenter Tulsa, Mat was a Strategy Director at The Property Finder Group, where he worked closely with the CEO and senior management team on various international acquisitions, scaled local teams in the group’s Saudi Arabia and Egypt offices, and executed a number of strategic projects in the business’ core market of Dubai. Mat has been an active investor since 2014 and is a licensed real estate agent in Oklahoma.
Here’s a glimpse of what you’ll learn:
- Mat Zalk explains Keyrenter Property Management’s eviction and mediation processes
- What are the greatest challenges in the property management industry?
- COVID’s effect on the eviction process
- How Keyrenter helps property owners handle evictions
- Mat talks about eviction and legal expenses and notable stories
In this episode…
Evictions are an unpleasant yet necessary part of property management. Property owners are often hesitant to evict a tenant and use it only as a last resort. But, delaying evictions diminishes cash flow, directly impacting ROI. So, how can you conduct an effective eviction that benefits you while giving the tenant leeway?
According to Mat Zalk, the eviction process should be tactical and occur within the first month of delinquent payments. For Keyrenter Property Management, this entails issuing a late rent notice five days after the payment date and initiating the legal process another five days following the notice. The company also conducts mediation so the tenant and landlord can reach a mutually favorable agreement. Whether you have a tenant who makes consistent late payments or a resident who refuses to leave, Keyrenter can take over the eviction process and oversee the management of the property thereafter.
Tune in to this episode of The Same Day Podcast as Chad Franzen of Rise25 catches up with Mat Zalk of Keyrenter Property Management to discuss how to handle evictions. Mat discusses Keyrenter’s eviction and mediation processes, the greatest challenges of the property management industry, and COVID’s effect on evictions.
Resources mentioned in this episode:
- Mat Zalk on LinkedIn
- Keyrenter Property Management
- Keyrenter Property Management Tulsa
- Keyrenter Property Management Oklahoma City
- Keyrenter Property Management Arkansas
- Keyrenter Property Management email address: [email protected]
- Chad Franzen on LinkedIn
- Rise25
- “From Engineer to Entrepreneur” with Joey Wignarajah on The Same Day Podcast
- “Strategic Entrepreneurial Approaches” with Sean Printz on The Same Day Podcast
- Chris Lile
- Evicted: Poverty and Profit in the American City by Matthew Desmond
Sponsor for this episode…
This episode is brought to you by Keyrenter Property Management.
Keyrenter Property Management is a full-service property management company who helps their clients buy, renovate, and operate real estate assets.
They help clients build wealth while taking the headache out of property management.
That’s why, no matter what rental you have — single-family homes, condos, townhomes, or apartments — they can give you the management solutions you need.
To learn more about their services, go to https://keyrenterpmc.com/ or send them an email at [email protected].
Episode Transcript
Intro 0:05
Welcome to The Same Day Podcast where we discuss driving incremental business growth and other topics related to real estate, property management and entrepreneurship. Now to the show at hand.
Mat Zalk 0:20
Mat Zalk I’m the host of The Same Day Podcast where I connect with top business experts and real estate leaders. We’ve had a lot of people on the podcast, but some notable guests have been Joey Wignarajah 19days who’s working over there with Jacob get with doing a venture studio. Super cool. They’re iterating on ideas on problems that we have in business and society, solving them, scaling them, and then moving on. And Sean Printz Elect Technologies out of Colorado who’s a client of ours and has worked with us through multiple renovations. Today, I’ve got Chad Franzen of Rise25. On he’s done 1000s of interviews with successful entrepreneurs, investors and CEOs. And we’re flipping the script and he’s going to be interviewing me, Chad, take it away.
Chad Franzen 1:09
Hey, thanks so much, Mat. Great to be here. Before we get started, I’ll let everybody know that today’s episode is brought to you by Keyrenter Property Management. Keyrenter Property Management is a full service property management company helping their clients buy renovate and operate real estate assets. They help their clients build wealth while taking the headache out of property management. In fact, a key renter client recently bought a property for $55,000. Keyrenters general contractor Seth Rice, manage the entire renovation, which costs $35,000. The client has never seen the property to this date. And for anyone interested in viewing the end product. The address is 1502 North Columbia Avenue and Tulsa key renter listed the property and got 1004 $1,049 in monthly rent. And it only took a few days of marketing to get a great resident for that property. That’s why no matter what rental you have single family homes, condos, townhomes, or apartments, can you rent or property management? As the management solutions you need go to keyrenterpmc.com, or email them at [email protected] Hey, Mat, thanks so much for having me today. How are you?
Mat Zalk 2:12
I’m great. Thanks for Thanks for helping me with this. Sure. Hey,
Chad Franzen 2:16
today we’re gonna talk a little bit about a topic that everybody’s interested in, but everybody would like to avoid and that’s eviction? Can you kind of tell me what your process is for eviction as a as a management company?
Mat Zalk 2:26
Yeah. So I guess philosophically speaking, we want to make sure that we are on top of evictions, and not letting them delay or drag on. So the worst thing that can happen is we should do an eviction in a certain month. And I say we as an any any landlord or property owner, we should do an eviction in the month that the delinquency starts. And instead we let it go because of excuses or promises to pay and other things and it carries over into the next month and potentially in the future months. And that’s that’s a really bad situation. We don’t want people living for free. I want time told this goes back many years. But Chris Lile was a client of ours had had a situation where there was a non paying tenant, he was managing the property, himself, he and his wife. And ultimately, they turned the property over to us. And the first conversation that I had with a tenant, which was by long story kind of a friend, old friend or family related family adjacent or something. I said the Lile’s don’t operate a charity. If you want to get resources and help for your rent, there’s plenty that I can guide you to, but it’s not them. They’re running a business. And ultimately, they need to collect rent, so they can get a return on their investment, which is why they have a beautiful property for you to eat in the first place. So back to our process, that the reason we don’t The reason we have a type process is that we don’t let any of that happen. Our process is generally this our lease says that rent is due on or before the first and is late by the second. Because we absorb many rental contracts from other people, right self managing owners or other management companies, we go to a lowest common denominator approach to our evictions. And since many of those leases say that rent is due on the first and late by the fifth, or by the sixth, we don’t actually deploy at five day pay or quit notices or three day pay or quit notices in Arkansas until the sixth day of the month. But on the sixth that rent is not paid. And we haven’t had an explicit conversation with a tenant who has been very communicative and cooperative about when they’re going to pay rent, we will issue a five day pay or quit notice on the sixth, by the 11th, we will then send that off to to the eviction attorney to get that process started. So from the 11th, we might have a couple of weeks, right? It might be a week or two before there’s a court date. In Oklahoma and Arkansas courts are generally fairly landlord friendly. And so unless there’s a unless there’s a real situation that prevents them being you know, something where the judge, you know, feels very bad for them or we have a gaping hole through the roof or something and it’s it’s been, you know, bad practice on the part of the landlord. They you know, will generally get a default judgment if they don’t show up and the judgment if they do show up on With on that court date, I will say because we’re a gold star landlord, gold star landlord in Tulsa County, or in the city of Tulsa, I can’t remember which we are required to do mediation. So we will send the documents through to mediation through the mediation organization at the City of Tulsa. And we will try to have a mediation so that we can have a better outcome for our owner, hopefully, the tenant can actually stay and agrees via mediation to pay or whatever else. And if we’re not able to set up the mediation and the eviction actually takes place. So generally speaking, because mediation is for, I don’t want to, I don’t want to grossly characterize. But generally mediation works really well when the tenant is not paying rent, because the landlord has withheld something right repair or maintenance of the property, Keyrenter is not going to be doing that. And so generally speaking, our mediations are not super, super fruitful. Because normally, you’d expect them to say, oh, there’s a hole in the roof. And, and it’s been pouring water, and I’ve had a big trash bucket underneath it for the last six weeks. If you just fix that, I’ll go ahead and pay my rent. In our case, you know, we don’t defer maintenance in that way. So that that nature that that level of conversation hasn’t happened. So that’s generally speaking the process for the eviction, we get, you know, at the time of the judgment, we might need a day or two for the judge to sign the final decree, and then a day or two for the sheriff to post the notice. And then do an official lockout, when the lockout happens, our maintenance technician, one of them is there to actually change the locks. Sometimes people are physically still in the property and need to be escorted out. And then we need to do a clean out of the property or we need to make gifts have an arrangement for them to take their stuff out without taking possession back of the property. But most of the time, when we do an eviction, the the resident former resident of the property has already gone.
Chad Franzen 6:43
Is there anything more about your mediation process that you’d like to share?
Mat Zalk 6:47
I just I mean, I think I shared most of it, I would love for the statistics that the mediation center shares to be true. I mean, they do say that they’ve got a very positive outcome 80% of their cases, settle with some sort of mediation instead of going further to court, we’ve not found it to be the case. But it doesn’t mean that we can’t try harder to do those mediations and make sure that the pieces are connected. In general, when we send through the documentation for mediation, we’re not seeing huge success rates and scheduling, the meetings, the actual mediation, because when the tendons become non responsive to us, they’re also non responsive to other people. And you have to imagine, I mean, there’s a eviction is a terrible situation in general. And it’s, you know, there’s a great book called Evicted from the eviction lab out of Princeton, I believe. And it’s just a terrible in general, terrible situation. It’s often you know, it’s often low income, people get stuck into vicious situations, they get evicted, and they can’t get another property. And they ultimately they end up living in precarious situations, right, with a partner, or spouse that may be abusive, they can’t get away from it with somebody that they know that’s using drugs, they can’t get away from it, their kids are involved. It’s a terrible situation. And we want to be part of the solution, not part of the continued problem. And you know, Tulsa has seen an eviction, you know, we’ve seen lots of evictions, and there are, there are significant issues, we’d love to be part of the problem. And so we try to participate as much as possible in the mediation. It’s just not, it has not been super successful for us for the reasons that I explained earlier.
Chad Franzen 8:09
Would you say that evictions are kind of the worst thing about being in the property management business?
Mat Zalk 8:14
I would say cleaning up and eviction is the worst part of being an property management business. And I’ve got hundreds of photos in my phone from our the vendors that we work with on the clean outs that are just like what is going on that challenge is that it’s not always us evicting a resident of a property, oftentimes we absorb a property. And then we’re done. We’re just responsible for the cleanup. And of course, we say we will take a property in any condition, an owner can hand us the keys in any condition, and we’re happy to do the work. We never shy away from work. So those clean outs are our, you know, par for the course they’re just part and parcel of what we do. So I don’t want to encourage anybody to not give those to us, because we want to take that headache away from people and we know that people that can that can solve those challenges. But we’ve seen somewhere Oh, my gosh, Barney, who’s on our team, and Germaine, who’s on our team, you know, they’ve they’ve buried dogs and backyards, they’ve found desiccated, you know, animals, cats, possums, rats, it gets, it gets pretty bad. And then, of course, when you have squatter homes, you can imagine, you know, using the restroom and various closets and other things, they can get pretty bad. So I would say that’s the worst part of doing it. Fortunately, our team doesn’t directly have to actually do that work. We just we hire that work out. And, you know, like the dirty jobs, whoever that guy is that does Dirty, dirty jobs on one of those TV shows. It’s that kind of thing. And I will say, my grandfather busted memory, obviously to say maybe dirty work, but it’s clean money. So we pay them we pay them the money and they do the job, and nobody’s ever complained. So it’s
Chad Franzen 9:42
important to keep that in mind. That in terms of evictions, then how did how did that process changed during COVID? If it did?
Mat Zalk 9:52
Yeah, so during COVID There was the moratorium on evictions, which meant that nobody could be evicted for a sick I don’t remember the exact months but there was a significant period there weren’t Nobody can be evicted. If the financing mechanism the debt instrument on the property was a federally backed mortgage. So if it was Fannie, Freddie Ginnie Mae, whatever it is, they were not not able to be evicted. And there’s a moratorium that went on for a long time. Fortunately, a huge number of our clients are on commercial notes, and that those are not federally backed. Of course, the difference between a commercial note which is like five year term, seven year term, on a 20 year AM, is different than a conventional note, which is the federally backed note is 30 years, fixed interest rate, 30 year amortization and 30 year term, which is really, really nice if you’re a property investor to have one of those. But so during that period, we were not able to evict then once it opened up, the courts were so backlogged that it just took forever to process an eviction. So that was really, really painful. The fortunate side of the flip side was to prevent unnecessary evictions, the Cares Act money that was authorized, I guess, under Trump, initially under Trump, then maybe under Biden, I can’t remember was funding many people’s rents. So we were able to submit the documentation of the eviction and the and the federal money that was cascaded through restore hope, and Oklahoma community cares partners was coming in to pay people’s rent. So in many cases, we didn’t have to event I also do I mean, just transparently look at many people’s Ledger’s. And I see that they’ve never paid rent in their, you know, in May, we may have, we may have absorbed a property, as we did last summer 2021, where, you know, we took over 64 properties, I’ve got people that have never paid their own rent, because it was always paid for by restore hope or community cares, or a combination of both. So we may not have evicted the people but you know, they weren’t also paying rent.
Chad Franzen 11:37
How, how long does it generally now now that we’re kind of, you know, a little bit past COVID. Anyway, how long does it take you to get a court date now.
Mat Zalk 11:45
So oftentimes, it can take, you know, seven to 10 days, perhaps more if the FVD docket and the small claims court is really, really busy. But we recently were seeing extended dates and our attorney said something like they spoke to the court clerk because it’s an I’m not an attorney, I don’t really know a ton about legal topics, but it’s out of statute. I mean, they have to they have to be they have to present a court date option that is within a certain amount of time. And we weren’t seeing that happening. So they talked to the clerk, the attorneys talked to the clerk and got dates pulled in a little bit. So it’s actually quicker now, the challenge is that, you know, the judges generally rule in favor of the of the landlord, the owner, but they’re, they’re not heartless, and that they do give residents that are specially if you’ve a family, or you’ve been there for a long time, they’ll give you, you know, a couple of days a week, sometimes two weeks to kind of get your possessions in order and move them out of the house so that an eviction is not taking place that that that strands you I guess in the most. I guess in the most dire of circumstances or situations like at least they kind of give you a couple of weeks to get everything in order and find another place to go.
Chad Franzen 12:59
So have you been in a situation I’m sure you have. And I’m curious, I’m curious what happens when an owner brings you a property with a tenant that that he or she wants evicted? For sure.
Mat Zalk 13:09
And what happens is to kind of the comments that I made at the beginning of the of the podcast is oftentimes we see owners bring them to us when they’re so many months behind on rent. And that is really painful. I mean, I just hate to see that happen. Again, our owners are not running charities, there are plenty people that do run charities that can provide help and assistance to residents, especially residents that have been laid off or fired or affected by COVID. But our owners are not running charity. So what we see is, it happens all time. I want to reiterate to our viewers and listeners that we do not shy away from hard work. So if this is a case that where an owner wants to bring us a property, and they want us to do all the work upfront to do the eviction, where we get paid nothing fundamentally. And then on the back end, leased the property and manage the property, we’re happy to do that. No problem. We love to add value as much as we can anyway, we can’t. But what we see is, owners bring us a property and they say this person was a great tenant for five years, they always pay their rent on time. And then things started to deteriorate last, you know, 12 months ago and they were late, a few months they got caught up, then they were late two months, they got caught up and now they haven’t paid in the last six months. It’s really sad. I don’t want to be involved in actually doing the eviction, but it needs I know that it needs to get done. Can you take over and do it and then lease the property again and manage it after that. I’m busy with my full time job or whatever else and I don’t really want to do this at this point. No problem from our side. We’re happy to grab the bull by the horns and take care of it. I’m happy to have tough conversations with residents. Oftentimes, what we see is they come to us and say this, this resident needs to be evicted. They’re now two months behind and once they once the owner hands us the property and we start taking concerted steps to make contact with the tenant. Explain to them what’s going on. Explain to them that they’re going to be evicted, issue them a five day pay or quit notice all of a sudden the tenant snaps into shape and they go Holy Moly, I’m not, I’m not dealing with my, my mom’s neighbor anymore. I’m not dealing with my second cousin anymore, I’m actually dealing with a professional property management company, and I have no doubt that they’re gonna kick me out of my house. And I don’t want to get kicked out of my house and all of a sudden they start paying. So we see oftentimes that they just start paying rent, and they start paying it on time, with late fees if they’re late. And we don’t have to deal with it with the eviction, with actually playing out the eviction card. But just knowing them knowing that we have on this side professional property managers that are following a process and are willing to carry things through makes all the difference in the world.
Chad Franzen 15:30
So when that happens, how much do you charge for an eviction?
Mat Zalk 15:34
Yeah, so we actually don’t charge anything for the eviction itself, the attorneys will charge. Now we’re September of 2022. I don’t know our exact rates, but like, I think $130 For the eviction, for the process serving for the representation in court. And for the judgment, if it’s uncontested, meaning if the if the resident does not show up. If the resident does show up, I think it’s like $180. And then of course, if we have a long protracted legal battle, which has been known to happen, that might be three or $400. It’s a little bit higher in Oklahoma City. It’s much higher in Northwest Arkansas, I think poor process in Arkansas, something like six to $800. But certainly in Tulsa, we we have pretty reasonable pricing. And it’s you know, it’s it’s a quick and fairly painless process from an owner side. And from our side,
Chad Franzen 16:19
when you first kind of established this business was we’re evictions, something that you even thought about. Yeah, I
Mat Zalk 16:26
mean, I always knew that when we started this thing, we started Keyrenter Because I was buying properties. And they were low income properties. I knew I needed to raise the rents from like 330 and 350 to 550 600. So we went through some evictions early on, it was messy. I mean, some we bought some drug properties, we bought some just very serious residents. And so I knew the whole time that it was that it was a part of the business. And we’ve had, you know, we’ve had people barricade and barricade themselves in properties we’ve had certainly people that have taken multiple attempts with the sheriff to get them out. We’ve had people, you know, escape out the back doors were coming in the front, we’ve seen we’ve seen all sorts of stuff.
Chad Franzen 16:27
Well, I was just gonna ask you, do you have any, any maybe specific eviction stories that you’d be interested in sharing?
Mat Zalk 16:46
We actually had one up in a Waso. A while back and this is going back a few years, we had a long protracted eviction, the resident finally moved out when the sheriff escorted her out. And then at some point, she I guess we didn’t change the keys or there was one lock, so we didn’t change the lock, or there’s one lock that we didn’t change, or she got in through a window. I can’t remember exactly what happened. But she got back into the property and then started living in the house again. And the judge ruled the cops would not think generally speaking, the cops won’t do anything, right. I mean, it’s the sheriff that will lock somebody out. But if they have possession of the house, they have possession of housing, you need to go back to the courts and do the eviction. So we had to do the eviction all over again. Which was just I guess, I respect or admire the tenants tenacity to stay in the house. Ultimately, we were granted the eviction, we boarded the house up. And she wasn’t able to get back in after that. We changed all the locks, we locked all the doors, all the screens, all the windows, etc. And, and ultimately, she wasn’t able to get back inside the house. But that was that was a that was a good one for sure.
Chad Franzen 18:17
Okay, well, that is crazy. Hey, Mat, thanks so much for talking to me about this today. Hopefully, that’s this is a situation for all parties involved, that can be avoided as much as possible. With
Mat Zalk 18:26
proper screening and good upfront work. It generally is.
Chad Franzen 18:31
Great. Hey, thanks so much for having me today. It’s been great talking to you.
Mat Zalk 18:35
Thanks, Chad. Thanks for being with me. So long, everybody.
Outro 18:40
Thanks for listening to The Same Day Podcast. Tune in to a new show each week, and be sure to subscribe to get future episodes