Questions and Answers for November 2016: Cloud Security and Last Month’s Rent

Cloud Security

Adapted from our Message Boards, where members can ask questions and get answers. Practicing landlords and service providers answer questions, and we combine the best answers into one here.

Q: Can anyone recommend good desktop accounting software? I Don’t Like Cloud Software. I don’t want my data in the cloud.

You can still purchase desktop versions of Intuit QuickBooks and Quicken. Gnu Cash and Microsoft Money Sunset edition are still free for downloading, too, although they’re rather dated at this point. A better question would be, “Why is accounting software moving into the cloud and how can I use it securely?”

Software development companies and other businesses that make money selling information (think, “music industry”) have had a couple of serious business challenges over the last 15 years. The primary one has been piracy. The Internet made it easy for programs or music to be shared, so people stopped paying the people who made the programs and the songs.

Both music and software are now licensed individually. A major way to control distribution is to require someone to log in as themselves. So we’re going to see more and more software become cloud-based. Even Microsoft Office is already headed there with its “Business Essentials” and Office 365 products.

Cloud services require your browser to say “https”, require the server to be kept updated by professionals, and require you to keep a secure password. If your password is your street address, you shouldn’t be using cloud services. You will be hacked.

If on the other hand you have a password manager like LastPass, you can keep infinitely many, egregiously difficult passwords with the press of a button. In this way, you can be pretty sure that your data are safe in the cloud. Reputable companies have policies and procedures that prevent employees from reading your files or information stored on your servers, and some companies, like SpiderOak, actually make it impossible for any employee to view files you upload.

So onward and upward, the cloud awaits!

Last Month's Rent

Q: I took last month’s rent a while ago, raised the rent, and now I want more last month’s rent. The tenant refuses. Can I evict them?

This problem may seem trivial but it becomes acute with long-term tenants. If rent is increasing steadily, your last month’s rent might be quite a bit below market when it finally accrues.

The challenge is in the law. If we had more generous laws, we might be able to collect "last month's deposit," but the law (MGL Ch 186 Sec 15B) clearly states that we're collecting "last month's rent":

"(ii) rent for the last full month of occupancy calculated at the same rate as the first month; "

When we collect last month's rent at move-in, we sell one month's rent at a certain price. If we later increase monthly rent for other months, it doesn't change the fact that the last month has already been sold for a lower price. It's not a deposit for the last month, it is the last month.

Some landlords offer a “letter of completion” when the lease is due for renewal (aka, “termination of tenancy and offer to create a new tenancy”). This letter establishes a legal process to take more last months’ rent:

Use the amount already paid to mark the last month paid under the current lease. Have the tenant sign a new lease and pay a new last month’s rent at the higher rate. Have them sign a continuance of the security deposit, if any, and make sure to re-issue all the security deposit paperwork.

This lets you terminate the rental agreement, evict if they refuse to pay an increase, and collect a market rent for your last month, however far into the future that may be.