On the show today we talk with… Lucas Hall of Cozy!
Here are the show notes
The Vantastic Life is…
– in El Paso Texas
Today we are talking with Lucas Hall of Cozy!
He’s in Arvada Colorado.
Bought first house hack in 2005 in DC, and bought property because he met this girl that was doing the same thing. So, I thought she was really pretty and really smart, and 3 years later we got married.
He essentially did BURR before was called BURR.
Accumulated 5 properties in 3 states.
3-4 years after becoming a landlord, outside of Bigger Pockets there wasn’t much out there for landlords.
So, he started blogging his heart out at landlordology.com. As an entrepreneur he watched Pat Flynn, and thought he could do the same thing, and thought he could make some money.
About 14-16 months after getting started he was ranking really well with Google, and then a bunch of other blogs started copying all his work.
Later, he was approached by the CEO of Cozy, and told they were doing the same thing, but Cozy was doing it through software.
So, they talked about acquiring landlordology.com, and it was great because he was able to quit his job, and spend a lot of time at home with his newly adopted daughter from Ethiopia.
So you still produce the content for landlordology.com?
I do, but I have a full team. So, me on steroids:-).
Let’s back it up, but everyone should checkout landlordology.com.
Let’s tell more people about Cozy. Give us the overview.
They started around the same time as landlordology.com.
Amazing online tools for landlords to run their own properties.
He always thought that Cozy was doing really cool stuff. And personally used Cozy.
Cozy lets you list your property, gives you free docs, and full credit reports and scores.
If you find a tenant… you can roll them into online rent payment solutions.
He actually tells he tenants that they can pay rent online and never have to write a check again. He’s tenants LOVE this!
Paying rent online shouldn’t be new because we pay all of our bills online, but most tenants still do write checks.
Paying online has become an asset as a landlord.
You can set it up as an auto pay, which is amazing!
On the management side we give you accounting software and maintenance tracking. You can take a pic of your sink and manage the repair all on Cozy.
We also help you manage all of your taxes and give reports to your accountant.
Are there other platforms or competitors?
There are about a dozen that do similar things in various forms. And we’ve set the bar, and now people are copying us.
We setup all kinds of cool thing, and were the pioneers for things like this.
Now we’re seeing people try to copy us. We monetize Cozy through the screening reports. We make enough money on those things that we can give everything else for free.
He’s never had anyone complain about the fees.
Is there an ideal portfolio size for Cozy?
We chose not to take that bundled approach.
You can use Cozy with one unit or one thousand units.
Our CEO was with Flickr prior to Cozy so he took a design approach.
You could use this for one thousand units, but it works before for people with one to twenty units, it’s just easier to sort through things that way.
Are there other asset types that Cozy supports?
There is no restriction on type of units you can use Cozy for. We have boat slips, power tools, parking spots, and all kinds of creative ways to use Cozy.
My friends at REtipster.com uses it to do seller financing on land. It’s a little weird but works great for him.
Does Cozy verify the applicants employment?
We were building something for that purpose, but we actually built Experian Connect, and we don’t call an employers, or verify past landlords. But we got feedback that the new landlords didn’t really want that.
Just just the credit reports, and background.
How about bill back for utilities?
Yes, you can totally do that. You can add any number of charges to their lease ledger. They can pay that on their phone right alway, or with their next rent payment. You can add pet fees, elevator fees, etc.
Do you add lease forms, or not?
Right now there are no lease templates, but you can upload your lease or other documents, and that gets shared with your tenants
Does Cozy send everyone an email at the end/start of the month to report payments?
Yes, and we highly recommend people sign up for auto payments, because it almost eliminates late payments.
Tells a story about a tenant that wasn’t able to process his payment that didn’t go through right away.
Just know that if you are a landlord that accepts checks… you are missing out on the best tenants, because the best tenants don’t want to pay via check, they are out making money.
Let’s say that someone doesn’t pay their rent… is there a connection through Cozy to manage that process?
We do have auto late fees, and most counties do have that.
It would be cool if you had a list of all the out of state information for counties that accept online communication?
We do have all of the county info.
Cozy is super awesome and you should use it!
The maintenance system is super intelligent, and allows you to upload a photo or video, and every person on the lease will see it and get notified of it, and have a discussion with all of the tenants at the same time.
It’s super cool, and helps you speed up the repair process. You can also take notes on the problem as a landlord, which can be very valuable (and this doesn’t have to be shared with the tenants).
You would think that property management companies would want to use this and invite the owner.
We don’t have the mechanism for multiple admin logins, but they can share the login.
There is just development time and money involved to get multiple admins in the system.
Do you guys offer a service where the landlord can load up their mortgage company, and have it paid.
We’ve only had a couple of people asking for that, so it’s not something that is a top priority for us.
Can I upload files?
We do allow you to upload any files that you’d like to share with your tenants.
We also give you a cute little one pager that is IRS categorized. It can go from thinking about your expenses at tax time for hours to about 5 seconds. It’s awesome!
If people are using something like Venmo… you are going to easily hit your limit if you have two or more tenants.
Also, PayPal doesn’t allow you to do free money transfers for rent payments. You have to pay the fee.
So, it’s takes a few days to get your money unless you pay $2.99 to get your money faster.
Correct, and it just takes 3-5 days to get all of the banks communicating with each other and get the money transferred.
When people make it happen faster, they are actually loaning you the money.
There is a mechanism where you can pay $2.99 per unit to get your money faster. This is not a loan or credit line.
The hassle is that if you do the loan option, money can get held back.
With Cozy we take the time to make sure the money is there and they we send it to you.
What is the process of unlawful container, or the eviction process. There’s some cases where you don’t want to collect the rent during the eviction process.
Correct. If you start the eviction process, and the tenant pays you even $1 you can have to start the eviction process over. And there are tenants that know how to play that game.
To enforce that through Cozy, you can hit a button that says terminate lease or stop payment, and they cannot pay you.
That seems so easy, and a reason why you should be using Cozy.
I’ve even heard of people that give their tenants their bank account info and they deposit money. But that just seems crazy! I would never do that!
Does Cozy track or post rental data?
That is the goal, we do have a tremendous amount of data and are trying to figure out how to make it available.
Cozy has been acquired by CoStar, who owns a bunch of other companies.
CoStar wants to copy Cozy and put that into apartments.
It’s been a great deal, and now we have a bunch of funds to use.
Once Cozy is completely integrated into CoStar will renter be able to use a single rental application to multiple places on the apartments.com site?
Yes, they can apply to multiple places.
Will this cause competition for tenants?
It will, but it will be good for landlords, and tenants, actually.
We want to get as many serious applicants to your door as possible.
You win, because you have more applicants.
I bet it’s going to turn into a “speed to lead” thing.
It’s true, but I find that when a tenant finds a property that they really like, they will hold out for your place.
Is there a tenant referral process?
I always approach my old tenants for referrals and offer them $500 if they refer someone that actually rents.
I also ask them to show the place for me, and if one of those people does sign a lease they get an additional $150.
This encourages keeping the place clean, dressing better, and they are part of the process.
How about AirBnB, do you have them?
I have one AirBnB, and I have a short term property manager that manages through iTrip.net. With that software he can push my property out to multiple short term sites, and they have a really cool calendar that communicates with all of the site, so there’s no double booking or double paying.
I would only use a property manager that has this software. He’s fee is 30%, and it’s totally worth it!
What else are to stoked about?
I’m really excited about CoStar and building a system like Cozy for apartments. It will help you find tenants and pay rent that’s even bigger and badder than Cozy. Even though Cozy will always be free?
I also really like Redfin, and am an addict! 🙂
CoStar has a fire hose of commercial data. I’ve been trying to go from residential to larger commercial buildings.
If you sign up for CoStar you can get a TON of data, and learn things like he best place to invest in like 10 minutes. Thing vacancy, job growth, etc… and you could find the best places to invest.
The cost is variable… it’s depends on how big you are. The small investor it can be as much as a few hundred bucks a month.
Investors say that if they have the CoStar app it will pay for itself if they buy a property every few years.
This has been great, and we’ve learned some massive nuggets!
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