Signing the Lease Agreement

Posted by on May 31, 2006 under Landlord Tenant Lawsuits | icon: commentBe the First to Comment

As a landlord, do invest time in finding a quality lease agreement that details what is expected of a tenant, including the treatment of your property. And, once you have screened, vetted and zeroed in on a prospective tenant, for greater impact and for it to be more effective, read and explain the lease to him / her in person. This way you can clarify and clear any issues the tenant might have with any of the clauses. You will agree the lease agreement is a sort of instruction manual for tenants on the rules and regulations to be followed, as long as they are renting your property.

Before handing over the keys to an expensive piece of property, just on the basis of one or two months security deposit, ensure your prospective tenant understands and agrees to all the terms and conditions that are a part of the lease agreement. You will be surprised to find out how many people sign on the dotted line, without so much as bothering to read what they are committing themselves to. Reading the lease with prospective tenants allows you to get a fairly good psychological picture of what they will be like as tenants. While, the reading is going on, simply, study carefully how they respond to the terms of the lease.

For example:

  • If your tenant prospect has a major problem with the late fee policy, you know you have got yourself someone who does not expect to pay rent on time.
  • What if the tenant prospect argues about being responsible for minor repairs?
  • Or the cleaning charges.
  • Or, if he / she has a problem with penalty charges for unauthorised occupants?
  • Or, he / she has a real problem with the default clause that outlines landlord eviction rights for non-payment of rent?

And, if you didn’t already know, you will find the lease agreement has a Daily Rental clause that allows landlords the same rights as that given to hotels. That is, in case of defaulting, you have the right to have the tenant removed and arrested for theft of services and/or trespassing?

As you can see, one can learn a lot about a tenant prospect at a lease signing. But, do bear in mind, the lease is not meant to be used as a weapon, it is simply a tool to help landlords protect and defend their property from unscrupulous tenants and difficult situations.

Invest in a quality lease agreement or get a lawyer to draft it for you!

Landlord Tenant Forms

Posted by on May 30, 2006 under Landlord Paperwork and Forms | icon: commentBe the First to Comment

If you are the owner of rental real estate, it is important any forms or agreements used are legally correct and binding. In the event of a landlord tenant issue, if you have taken pains to have all necessary and legally approved agreement forms signed, you will not have any problems in proving your case, in case you have to go to court.

Therefore, it is essential you use forms developed by professionals, either in the rental business or in the legal profession. There are many types of landlord forms, such as, rental applications, lease agreements, notices to pay or vacate, move-in forms, move out forms, 30-days notice to vacate, rent raise, etc. etc. Easily available, these forms can be downloaded from many online sites that offer free landlord forms. One such site is www.e-renter.com which has an extensive forms library.

You must bear in mind, as a landlord it is necessary for you to protect yourself from unscrupulous tenant elements, and the best way of doing so is to ensure all rental paperwork is in order. As long as you use the correct landlord forms, as the landlord, you will always be able to maintain the upper hand in landlord tenant negotiations.

Before letting a tenant move in, ensure all the necessary forms have been signed and are on file. Professionals suggest that the “must haves” are rental application completed in full, residential or commercial lease, and check in forms signed by both the tenant and landlord. Take the time to do things right and you won’t regret it later.

Five Easy Tips for Screening & Qualifying Tenants

Posted by on May 29, 2006 under Tenant Credit Checks | icon: commentBe the First to Comment

For a rental property owner, it is never easy to sit back and take it easy with it lying vacant, instead of bringing in a steady monthly income. So getting it rented out is your first priority. But, if only one were lucky enough to get ideal tenants, tenants who treat your property as their own, always pay rent on time and don’t distrurb the neighbors. That is why it is necessary for landlords to screen tenants before renting out property. Five easy steps to getting a properly qualified tenant are as follows:

  1. Step 1 –
    • Name,
    • Phone No.,
    • Reason for moving,
    • Number of people who will be calling your property home,
    • When they would like to move in,
    • Pets if any,
    • Last but not least, ask them to provide previous landlord references.
  2. First contact with a tenant, whether you are a landlord, real estate agent or property anager is usually by phone. This is when you can begin screening your would be tenant by asking the right qualifying questions before proceeding to the next step. Give all information such as rent, security deposit requirements over the phone and then proceed to asking getting answers to the following important questions:Get answers to all these questions over the phone, and proceed to qualify or disqualify prospective tenants if they have trouble giving you the requested information. If serious, they will wish to make a good impression, eagerly answering your questions. This process can save you and customers a lot of time and trouble.

  3. Step 2 – When showing them around the property, it is essential to watch for certain telltale signs while evaluating prospective new tenants.
    1. Appearance – Check their appearance, whether he / she is neat and clean, whether he / she made an attempt to make a good impression? You can be certain, in most cases; an unkempt person’s home will mirror his appearance, as will his / her lifestyle.
    2. Car – Ditto with the car. Check if the car is nice, clean, and well maintained?
    3. Attitude & Manners – Study attitude and manners, e.g. did he / she wipe their feet before stepping into the house or did they walk in smoking a cigarette. One can learn a lot from the attitude and manners of people, gauging from them whether they will be difficult to deal with in the future?
    4. Criticizing the property – try and determine whether criticisms about your property are legitimate concerns, or merely issues raised to try to negotiate the rent?
    5. Yes or No – whether the prospect is decisive enough to make a decision or has to think about it? If they want your rental, they will have come prepared with a deposit and have all information on hand to fill out a rental application form?
  4. Step 3 – Once the applicant has filled out the application form, let him / her know their application will be considered along with the others, and they will be notified once a decision has been arrived at. Advise the applicant(s) the importance of filling out the application as completely, as possible.And, if you intend to run a credit report on the applicant, that is recommended, you can collect a screening fee from your prospective tenant. Surprised, don’t be! There is a provision for this in most rental applications. That is one of the reasons, why you must ensure your rental application forms are quality ones, and not just any rag tag thing that has been quickly run up. Ask prospective tenants to return completed applications as soon as possible to avoid losing the rental to competing prospects. Review and verify the application forms thoroughly, looking for inconsistencies and ‘red flags’, and only when you are completely satisfied, then and then only proceed to the next step.
  5. Step 4 – Once, you have approved an applicant as a prospective tenant, let them know you are prepared to take them on, along with any special concessions you made just for them, such as overlooking minor credit infractions, etc. etc. This process is also an opportunity for you to make sure the applicant can and will deliver. Set the time, date and place for your lease signing. Instruct the applicant(s) to bring the appropriate amount, identification (if you don’t already have it), and how you prefer to be paid, by cheque, money order or cash. Remember to tell new tenants, possession or keys will be given only after all cheques have been cleared.
  6. Step 5 – As recommended before, ensure you have a quality residential lease. As a rule, people mostly sign a lease without reading them carefully. It would be a good idea to go over the entire lease with tenants at a lease signing. Reading lease terms along with the tenants, allows you to conduct your fifth and final step of screening by keeping a lookout for any arguments the prospective tenant may have, such as the issue of a late charge for late rental payment, and so on. If you are unhappy with how your prospective tenant responds to the lease, you are advised not to take him / her as your tenants.

Bide your time till a suitable applicant comes along! Better no tenant at all than to be stuck with a bad tenant!

Evicting Non-Compliant Tenants

Posted by on under Eviction | icon: commentBe the First to Comment

As a landlord there are times when you are faced with a non-compliant tenant who needs to be evicted. The reasons could be many ranging from non-payment of rent, failure to maintain or maybe a bad tenant who simply escaped the screening process. Before getting into expensive litigation, it is important for you to try friendly negotiation before taking things to the next level.

If you are thinking of evicting a tenant for non-payment of rent, you must understand, as a rule, tenants withhold rent for a variety of reasons that range from temporary unemployment or cash shortage, to simply because the landlord has not carried out necessary repairs or is irresponsible about maintenance tasks. Communication is the key to this common problem, and it is important for all landlords to understand a tenant’s problems, so they can negotiate with him.

If it is a case of the tenant being temporarily unemployed or facing cash problems, the most effective rent collection method is offering a structured payment option. Accept partial payments to help a good tenant out, till he is in a position to pay in full. Or else, suggest moving the tenant to a smaller, low cost unit or ask him / her to get a roommate to split the rental cost with. However, if negotiations fail, the landlord should try and convince the tenant to leave voluntarily, by explaining the negative long-term impact eviction will have on their rental history. You will find this strategy will work as eviction on their record may make it difficult for them to find a place to rent.

If uncertain about the grounds a landlord is entitled to ask a tenant to evict, they are as follows:

  1. Failing to maintain his / her rental unit in compliance with the maintenance standards listed under Tenant Responsibilities detailed under Section 24 of the FCRA. If a tenant does not take corrective action for health or safety issues that arise as a result of his / her negligence, the landlord can send him / her a written statement, asking for repairs, replacement or cleaning to be done immediately in case of an emergency or within 20-days. If the tenant does not comply, the landlord has the legal right to enter the rental unit and conduct the necessary repairs, charging the tenant for it.
  2. A landlord has the right to evict a tenant for failure to pay rent within 15-days of its due date, (or as specified in your jurisdiction) by sending a written notice (similar to Section 56-a of FCRA) requesting the amount overdue to be paid within 5-days of receiving the notice, failure to do so will result in the termination of the rental agreement, with the landlord having no option but to go to court to evict the tenant.
  3. In case a landlord does not receive the overdue rent within the specified timeframe, he is entitled to file Complaint for Eviction for Non-payment of Rent (Section 56-d) form in the local district court.
  4. After the case has been registered, the court clerk will give copies of the eviction complaint, an R.I.G.L. 34-18 Section 56-g court summons and Section 56-j tenant answer form to the landlord that must be sent by first-class mail to the tenant. As well, copies will be served to the tenant by the court sheriff.
  5. In case, the tenant feels he is being wrongfully evicted, he has the right to fill the answer form and send copies to the landlord / lawyer and the court before the hearing date. If the tenant is contesting his eviction, it is important for the tenant to attend the hearing and provide his or her defence as stated in the answer form.
  6. The tenant can also overturn the eviction by paying back rent, up to or at the hearing. But, tenants must bear in mind the option to pay after a court eviction action has been started is not allowed to those, who received other five-day late notices within the prior six months.
  7. And, what landlords must remember is, courts will not allow an eviction for non-payment, in case there is evidence the tenant attempted to make full legal payment that was refused by the landlord. Therefore, tenants should remember to keep records of returned cheques, cash, etc., as proof they did make an attempt to pay their rent, if in fact, this is true.

For protection from costly legal fees, landlords must ensure rental agreements contain property rules and regulations, while tenants should read carefully and understand what they sign. This way you can ensure a congenial landlord / tenant relationship that doesn’t have to end in acrimonious dispute!

The Importance of Obtaining a Tenant Screening Report

Posted by on May 26, 2006 under Eviction | icon: commentBe the First to Comment

Because, landlords and property rental companies perform credit checks on potential tenants on a fairly regular basis, it is important they adhere to the Fair Credit Reporting Act (FCRA) requirements. The FCRA as a law puts tight restrictions on the procurement and handling of tenant screening reports.

According to FCRA, landlords or rental companies are required to obtain a proviso or a written authorisation from each applicant before initiating a tenant screening report. This must be done for every tenant application, as your rental building address will be listed on each credit report, you pull. Before the Act took effect, if you used a screening agency to screen your tenants, the agency’s name was listed as the one initiating the tenant screening report. Since then, things have changed and now it is your property address that will appear on the credit report. This makes it important for you to get a disclaimer or authorisation from the applicant that gives you permission to conduct a credit check on him / her.

The importance of obtaining a disclaimer or authorisation from each applicant before asking for a tenant screening report cannot be emphasised. As well, always remember to keep the disclaimer / authorisation on file, even if the applicant has been rejected as a prospective tenant.

As long you adhere to FCRA rules, you should not face any problems, and for you to be in full legal compliance with the FCRA, your disclaimer should read as under:

“In compliance with state and federal laws, this is to inform you that a consumer investigation involving statements made on this application is being initiated. This investigation may involve obtaining information regarding your character, general reputation, credit, mode of living, and criminal background. You have the right to dispute the information reported. If this application is denied because of credit history, you may obtain a copy of your credit report from the credit reporting agency.

Landlord has my permission to release information found in screening for any lawful purpose associated with tenancy of premises. I authorize screening agency and landlord to obtain credit reports, character information, verification of rental history, employment history, bank information, public records, and personal reference as necessary to verify all information set forth in this application.”

As you will find, the FCRA also affects tenant screening, when the landlord or rental company takes adverse action i.e. rejects the applicant. Section 615 of the Act states when taking adverse action, the applicant must be provided with the following:

  1. Oral, written, or electronic notice of the adverse action.
  2. The name, address, and toll-free number of the consumer reporting agency responsible for providing the report, along with a statement stating the consumer reporting agency did not make the decision and cannot provide any specific reasons for the adverse action being taken
  3. A notice must be provided to the applicant that he / she has the right to obtain a free copy of their tenant screening report within 60-days, from the listed agency.
  4. The applicant must also be notified that he / she has the right to dispute the findings of the credit reporting agency, including the accuracy of any information contained in the credit report.
  5. The landlord has also to notify the applicant of the right to make a written request for information received from other sources other than the credit reporting agency within 60-days of adverse action being taken.

While issuing a denial letter, all of the above must be included to comply with the FCRA. Though, some of the FCRA requirements that affect tenant screening may seem unimportant, each one must be followed diligently to comply with the law and to avoid legal and punitive actions. Cutting corners will only find you liable for wilful or negligent non-compliance with the FCRA.

Therefore, while everyone landlord knows tenant screening is important in this day and age, the FCRA has been enacted to protect and promote accuracy, fairness, and the privacy of personal information assembled by Credit Reporting Agencies. There is protection both for Landlords and Tenants, just as it should be!

Tenant Screening: Complying with FCRA

Posted by on under FCRA Issues | icon: commentComments are off for this article

Because, landlords and property rental companies perform credit checks on potential tenants on a fairly regular basis, it is important they adhere to the Fair Credit Reporting Act (FCRA) requirements. The FCRA as a law puts tight restrictions on the procurement and handling of tenant screening reports.

According to FCRA, landlords or rental companies are required to obtain a proviso or a written authorisation from each applicant before initiating a tenant screening report. This must be done for every tenant application, as your rental building address will be listed on each credit report, you pull. Before the Act took effect, if you used a screening agency to screen your tenants, the agency’s name was listed as the one initiating the tenant screening report. Since then, things have changed and now it is your property address that will appear on the credit report. This makes it important for you to get a disclaimer or authorisation from the applicant that gives you permission to conduct a credit check on him / her.

The importance of obtaining a disclaimer or authorisation from each applicant before asking for a tenant screening report cannot be emphasised. As well, always remember to keep the disclaimer / authorisation on file, even if the applicant has been rejected as a prospective tenant.

As long you adhere to FCRA rules, you should not face any problems, and for you to be in full legal compliance with the FCRA, your disclaimer should read as under:

“In compliance with state and federal laws, this is to inform you that a consumer investigation involving statements made on this application is being initiated. This investigation may involve obtaining information regarding your character, general reputation, credit, mode of living, and criminal background. You have the right to dispute the information reported. If this application is denied because of credit history, you may obtain a copy of your credit report from the credit reporting agency.

Landlord has my permission to release information found in screening for any lawful purpose associated with tenancy of premises. I authorize screening agency and landlord to obtain credit reports, character information, verification of rental history, employment history, bank information, public records, and personal reference as necessary to verify all information set forth in this application.”

As you will find, the FCRA also affects tenant screening, when the landlord or rental company takes adverse action i.e. rejects the applicant. Section 615 of the Act states when taking adverse action, the applicant must be provided with the following:

  1. Oral, written, or electronic notice of the adverse action.
  2. The name, address, and toll-free number of the consumer reporting agency responsible for providing the report, along with a statement stating the consumer reporting agency did not make the decision and cannot provide any specific reasons for the adverse action being taken
  3. A notice must be provided to the applicant that he / she has the right to obtain a free copy of their tenant screening report within 60-days, from the listed agency.
  4. The applicant must also be notified that he / she has the right to dispute the findings of the credit reporting agency, including the accuracy of any information contained in the credit report.
  5. The landlord has also to notify the applicant of the right to make a written request for information received from other sources other than the credit reporting agency within 60-days of adverse action being taken.

While issuing a denial letter, all of the above must be included to comply with the FCRA. Though, some of the FCRA requirements that affect tenant screening may seem unimportant, each one must be followed diligently to comply with the law and to avoid legal and punitive actions. Cutting corners will only find you liable for wilful or negligent non-compliance with the FCRA.

Therefore, while everyone landlord knows tenant screening is important in this day and age, the FCRA has been enacted to protect and promote accuracy, fairness, and the privacy of personal information assembled by Credit Reporting Agencies. There is protection both for Landlords and Tenants, just as it should be!

Tenant Screening Service

Posted by on May 22, 2006 under Tenant Screening & Background Checks | icon: commentBe the First to Comment

The prudent evaluation of the rental prospect used to be a laborious exercise of interviewing employers, friends, previous landlords and other references, and deciphering occult credit reports which may be accurate or not, then, in all likelihood, flipping a coin. In recent years, services have arisen, devoted to the needs of the real estate rental market, not only to dredge up information on rental prospects, but to evaluate these prospects, verify employment and interview references, and even make decisions to rent or not, based on criteria the landlord has vouchsafed to the service. These are collectively referred to as screening services, and can do much, if not all, of the work the landlord used to do on his own. In one role, they can be used as a single source to obtain all the information the landlord needs to make his own decision on whether or not to rent. In another, they can be used as subcontractors to whom the entire decision to rent or not can be delegated, with the advantage that they are likely to be much more objective because not under pressure to fill a vacancy. The role the landlord selects will affect the process by which he decides which service to use.

The information which the landlord wants in order to screen falls into the following categories:

  1. Income and Employment
  2. Rental History
  3. Eviction History
  4. Credit History

Some landlords have also begun ordering criminal background checks. The value of these, given the present state of the art, is still a matter of debate, so they have not really yet become part of the standard screening package. Most screening services provide them for an additional fee and at an additional cost in time to produce them.

Whether the landlord sees the screening service as nothing more than a convenient point at which to procure a credit report and eviction history, or as a complete turn key service, accuracy is the first requisite. Whatever the service reports should be true.

Here are the benefits of Tenant Screening :

  1. Fast – Don’t lose applicants to slow service. We pride ourselves on our exceptionally quick reliable service.
  2. Reliable – Dependable service and reliable information that you can rely on.
  3. Accurate – Providing you with the most accurate information available, so you can make better decisions about your property.
  4. Credit, Criminal, Eviction, Sex Offender, and Suspected Terrorist reports are performed instantly and are accessible 24/7. Eliminate waiting days, hours or even minutes – reports are delivered in less than 15 seconds!
  5. Easy to use WEB-BASED system.
  6. Easy to READ and UNDERSTAND credit reports. Our reports are reformatted and color coded to make them user friendly and EASY to understand. (For example: if you see RED that means they paid late; If you see GREEN, that means they paid on time)
  7. Instantly sign leases based on reliable information – strike (RENT) while the iron is hot – and fill vacancies FASTER!
  8. Exceptional, innovative customer service We proactively monitor your requests online to immediately offer assistance if you encounter any trouble, and provide a toll-free phone number that a life support specialist will assist you during normal business hours (8am-5pm PST). We are here for you when you need us!
  9. Increase time spent with prospective residents of your community by reducing the time your staff spends on screening applicants.
  10. Improve NOI by making better decisions and reducing bad debt.

Stay Safe by Tenant Screening!

Posted by on May 18, 2006 under Tenant Screening & Background Checks | icon: commentComments are off for this article

Today’s newspaper left my eyes wide open. Lines I was reeading were like

“Tenants brutally killed old couple and ran away with $5,000,000 and jewelry worth millions”

You can reduce damage to you and your property and eliminate criminal activity by Tenant screening before you let your apartment on Rent.

Talk to landlords who have previously rented to the prospective tenant. Ask them if the tenant was ever late with his or her rent payments, and if he or she damaged the property in any way. Don’t call current landlords. If the prospective tenant is currently renting a home, do not call the tenant’s landlord. The prospective tenant could in reality be a problem, and his or her current landlord could lie to you, just to get rid of him or her.

Tenant screening is necessary, and after screening a few tenants, it becomes very routine.