Posted by Teresa on December 23, 2010 under Housing Trends, Landlord Paperwork and Forms, Tenant Credit Checks | 
Short-term leases are becoming more popular in some areas of the country. One trend is that homeowners who sell a home are less willing to buy right away, so while they wait and see what the market will bring, they rent for a while. Another factor is the toll the economic crisis took on renters’ credit scores. Landlords are less willing to take chances on one-year leases, so often a month-to month or six-month lease is a great option.
When the economy and job market are both doing well, the ideal situation for a landlord is a one-year lease with a strong tenant. But even though the rental markets across the country are starting to show improvement, many landlords are far from the ideal—and they still need to fill rental units.
When credit scores are less than perfect, and home sellers are knocking on your door, looking for short-term leases, it makes sense to adjust your lease terms from one-year to six-month or month-to-month.
Month-to-month leases mean that at the end of any month, the tenant can simply move—or the landlord can end the lease. Most leases require notice on each side, but if neither side ends the lease, it continues for another month.
7 Advantages of Short-term Leases:
- Your rental units could be occupied instead of empty
- Improved cash flow
- Possibility of higher rent negotiation
- Easier transition between tenants (less clean-up and maintenance)
- Larger pool of possible tenants
- You can get rid of a bad tenant more quickly
- For month-to-month leases, the rent can be adjusted at any time
Remember, no matter what the length of the lease, proper tenant screening is the most important step you can take prior to signing it. Conduct a thorough tenant credit check and background check and you’ll feel better about offering a lease to short-term tenants.
Posted by Teresa on December 14, 2010 under Landlord Paperwork and Forms, Landlord Tips |
Many tenants notify landlords of their plans to move at the end of a lease by mentioning it in passing. Others assume that, if they haven’t signed a new lease, the landlord knows they are moving and they don’t need to notify.
It’s a good idea to require tenants to provide a written notice of their intent to move. Many states require it, and if you use a well-written lease, it probably does as well.
The Advantages of Written Notices
Requiring tenants to put their intentions in writing is a good idea for several reasons:
- It eliminates the mix-up that can occur with verbal notifications
- It keeps the landlord/tenant relationship more businesslike
- It may be state law
- Written notices leave nothing to the imagination
- You won’t forget the tenant’s move-out date, which can lead to problems
- You’ll have time to prepare the security deposit return or deductions
What to Include on a Tenant’s Notice of Intent to Vacate Unit
Use a simple form, either one you obtain online or one you create yourself. You can provide it to tenants at lease signing, although it’s not likely they’ll keep it around long enough to turn it in at the end of the lease. Many landlords provide a form to tenants 60 or 90 days before the lease is up, with instructions to return it within 30 days of the end of the lease, if they plan to move.
The form should include:
- The date the form was completed;
- The name of the landlord or property management company;
- The address of the rental unit;
- Legal language including: The undersigned Tenant (name) hereby gives written notice of intent to vacate the rental unit at (address) on (date);
- A statement that the tenant understands they are responsible for rent until the end of the current lease or the day they vacate the unit, whichever is later;
- A statement that in accordance with the lease, the landlord is allowed reasonable access with advance notice to show the rental unit to prospective renters or contractors;
- A line for the tenant to sign and date the form.
As you can see, a thorough tenant move-out form covers all the bases: the date of the move-out, the day the rent is to be paid through, and permission to show the unit or allow access to workers.
Landlords who want even more information can include a short survey on the form, asking why the tenant is moving and if there is anything that could have been done to keep him or her as a tenant. This type of feedback is extremely valuable!
Pre-screen all tenants as part of your standard application process. Background and credit checks will help ensure you rent to qualified tenants. For more landlord resources, including forms and information on tenant screening, turn to E-Renter.com.
Posted by Teresa on December 3, 2010 under Landlord Paperwork and Forms, Landlord Tips |
Have a tenant moving out? Wouldn’t you love for him or her to leave your rental unit in a state that will make you smile? Why not just tell them exactly what you want? Sometimes tenants need to know your expectations. While there are no guarantees they will fulfill them, providing them with a tenant move-out checklist can make that more of a possibility.
And since most tenants want their entire security deposit returned, following a list can help them achieve that goal. A little education and open communication can go a long way toward a win-win situation for both landlord and tenant. Here are some items you might want to include on your list.
Move-Out Check List for Tenants
- All trash removed from premises, including patio and storage unit
- Closets emptied and vacuumed or mopped
- Bathroom clean, including tub, sink, toilet, vanity drawers, shelves, floor and baseboards
- Kitchen clean, including inside of cabinets and drawers, counters, sink, baseboards and floor
- Disposal in working order
- Refrigerator empty and clean, including shelves, drawers and door (do not turn off)
- Freezer empty and clean
- Dishwasher empty and clean
- Stove top and oven clean, including range hood
- Broiler pan clean
- Nails removed from walls
- Any spilled paint cleaned up
- Locks on windows and doors in working order
- All window blinds clean, in place and in working order
- Carpets vacuumed
- Linoleum and tile floors cleaned and mopped
- All ceiling fixtures, with light bulbs
- Windows clean
- Ceiling fans clean
- No carpet stains
- No scuffs on walls and floors
Starting with a list will help ensure that tenants are meeting your expectations—and help them get their security deposit back.
Posted by Teresa on November 30, 2010 under Landlord Paperwork and Forms, Landlord and Tenant FAQs |
Many landlords we hear from believe that a thorough, well-written and lawyer-approved lease should contain all the rules and regulations a tenant needs to follow. And that’s partly true. But there’s a difference between the terms of a lease and the everyday policies you want your tenants to follow.
As a rule, leases are where the legalese lives: the legal description of the property, legal names of the parties involved, legal termininology, and the landlord’s legal recourse when terms are not followed. The “house rules” are generally more relaxed in language, are more flexible (i.e., they can change at any time with notice to all residents) and are simply intended to help everyone get along better and live in harmony. They are generally not legally-enforceable documents.
A signature on your list of policies or house rules is just as important as the signature on the lease. You want to be clear that your tenant understands the rules and agrees to abide by them. Review them together at the time of the lease signing, and be sure to ask if any item needs clarification.
10 Items to Include in Your Rental Property Rules
- Noise: Emphasize that consideration for other tenants is required, and that while your rental unit is well-constructed, it is not to be considered sound proof. Noises that disrupt others’ quiet enjoyment are not allowed. Include quiet hours, if desired.
- Window Treatments: Here you’ll include whether or not blinds or drapes are included with the rental unit and what care they require. If no treatments are provided, you may want to specify what color and type of coverings are allowed—and what are not allowed (like aluminum foil).
- Keys: Any key replacement fee should be included here, as well as emergency lock-out fees if a tenant forgets his or her keys after hours.
- Inclement Weather Procedures: Inform tenants of your requests during times of high winds, low temperatures, or high rain, as well as thermostat settings when the rental unit is occupied for specified lengths of time.
- Trash and Recycling: Tenants need to know what can be recycled and where it goes, along with non-recyclable trash.
- Parking: Where tenants are allowed to park, how many vehicles each unit is allowed to keep onsite, where not to park, and whether or not non-running vehicles are allowed are some of the rules you’ll want to spell out here.
- Common Areas: Are tenants allowed to leave property in common areas like hallways, sidewalks and patios? Who is responsible for clearing snow and ice from walkways? Spell these things out here.
- Storage: Indicate where tenant storage is located, how they can access it, and any limitations (flammables, vehicles, dangerous chemicals, etc).
- Guests: Include things like where guests may park their vehicles and tenants’ responsibilities for their guests.
- Bicycle Parking: As bicycle commuting becomes more popular, many tenants will want to know where they can park their bikes. If you don’t want them chained to fences or balcony railings, specify where bike parking is allowed. Better yet, create special areas for bikes that are convenient and secure for cycling tenants.
Presenting a friendly list of house rules lets all tenants know what is expected of them and their fellow tenants. After all, who (besides fraternity kids, perhaps) wants to live in a place where there are no rules?
Posted by Teresa on November 16, 2010 under Landlord Paperwork and Forms, Landlord Tips |
If you’re a new investment property owner, starting out with all your paperwork in place is a must-do. That means compiling a lease agreement before you show your rental property to a prospective tenant—no matter how badly you want or need to rent it.
Depending on where you live or where your rental property sits, you’ll have specific requirements unique to that state or locality. Be sure to familiarize yourself with the requirements of your state. But in general, the same provisions apply to most residential lease agreements no matter where the property is located. Most important: you need to be sure your lease agreement protects your property, your other tenants, and your business and personal resources.
Here’s a handy list of important provisions to include in a lease agreement:
- Legal Description of the leased premises: Be thorough. Include address, apartment number, city, state and zip code
- Term of Lease, including starting and ending date, with a provision to terminate early in accordance to provisions of the lease;
- Use and Occupancy: Explain how the property may be used (i.e. “for residential purposes”) and a list of names of authorized occupants.
- Rent Payment: State the amount of the rent, how it is to be paid, and penalties for late payments and insufficient funds. Consider a statement that no partial rent payments will be accepted (to avoid any problems if eviction becomes necessary).
- Security Deposit: state the amount of the deposit due upon signing the lease, as well as conditions for return of the security deposit.
- Default: Explain events of default and remedies.
- Utilities: State who pays for which utilities, including gas, telephone, cable, internet, electricity, water, sewer and trash pickup.
- Covenant of Quiet Enjoyment: This explains that the tenant, upon fulfilling his or her obligations under the lease, may peaceably and quietly enjoy the premises without interference by the landlord or a representative thereof.
- Assignment or Subletting: State whether or not the tenant is allowed to assign the lease or sublet the property, and if so, set the conditions under which they may.
- Pets: State whether or not pets are allowed and any restrictions related to type, size, breed, number, etc. Also include the amount of any required pet deposit or fee and conditions for return at the end of the lease.
- Maintenance, Damage and Alterations: States what maintenance the property owner is responsible for, what the tenant is required to do to maintain heating and plumbing systems, when routine maintenance inspections will be conducted, conditions under which the property owner may enter the unit for emergency repairs, and what alterations (paint, for example) are allowed.
- Insurance: Explain what type and level of renter’s insurance is required, if any.
- Abandonment: Defines what may be considered abandonment of the property by the tenant, and the landlord’s rights when it occurs.
- Right to Enter Premises: States when and under what circumstances the property owner or representative will be allowed to enter the rental unit, i.e., number of hours or days of notice.
Other notices, indemnities and covenants are likely to be required in a particular state or by your attorney. It’s always best to have legal counsel review your residential lease prior to using it.
Any forms or information provided by E-Renter USA is not intended to replace legal advice. You are advised to consult an attorney in your area, and to check all local and state regulations.
Posted by Teresa on October 6, 2010 under Landlord Paperwork and Forms, Landlord Tips |
Common gripes between landlords and tenants can often be prevented through clear communication. And by “clear,” we mean “absolutely, crystal clear.” Murky, misunderstood or meaningless agreements almost never work in the rental property business.
Four simple steps to clear communication:
- Say exactly what you mean.
- Put it in writing.
- Make sure the tenant understands.
- Get the tenant’s buy-in.
Say exactly what you mean: If you require pet deposits for the privilege of housing a pet in your rental property, specify if they are refundable with no damages or non-refundable and not intended to cover damages. The vague term “pet deposit” could be interpreted to mean “refundable if my pet does no damage.” The day a pet-owning tenant moves out and expects that deposit back is not the time to explain that you really meant it’s non-refundable, damage or no damage.
Put it in writing: We’re not lawyers, and of course you should always consult with yours before proceeding along the path to any agreement, but do remember that when it comes to landlords and tenants, the “he said, she said” argument rarely wins over a signed, dated agreement. When it comes to the landlord business, the more signatures, lists, photos and pieces of paper you have, the better.
Make sure the tenant understands: Never assume a tenant knows what you’re talking about. This doesn’t mean you should patronize or talk down to a tenant—or treat them like they’re in kindergarten. It does mean to take the time to explain every detail of the lease agreement, tenant rules, pet policy, causes for eviction, quiet hours and even appliance operation. Whatever it takes to establish a respectful, mutually agreeable relationship in the beginning will pay off through the time of the lease. It takes time and effort to look a tenant in the eye, ask if they understand, explain if they don’t, and obtain a signature saying they do. But it can save a lot of hassle down the road.
Get the tenant’s buy-in: Don’t dictate to your tenants. Help them understand that every rule, every procedure, and every effort on your part is to make their rental home a place they and their neighbors want to live. Ask for their cooperation in making it so.
Sounds simple, right? As with anything that’s worth doing, establishing clear communication with tenants may take time and practice. But it can’t hurt to try and see if it makes the landlord/tenant relationship a little smoother and more pleasant!
Posted by Teresa on September 14, 2010 under Landlord Paperwork and Forms, Landlord Tips, Tenant Screening & Background Checks |
1. Not approaching your rental business like a business. To be successful, all businesses need to follow a plan. They need to be capitalized. And they need to be run professionally. This takes time, energy and money. Some landlords are not willing to invest all of these resources into their businesses. Some don’t have a plan. Some don’t have enough capital to keep their businesses going when rent income falls below projections (if they even have projections). Being unable or unwilling to do all of these things will almost guarantee a rental property business that is not as successful as it should be.
2. Conducting less-than-professional relationships with tenants. Landlords vulnerable to becoming too personal with tenants are often sucked into giving extensions on paying rent, reducing security deposit requirements or otherwise allowing tenants to ignore the established rules. Tenants who suffer no consequences will usually continue to bend or break the rules. It may seem harsh, but just as you can’t walk out of store without paying for a gallon of milk, a tenant should not be allowed to live for free in your rental property—even for a day.
3. Treating tenants differently. Letting certain tenants slide on the rent, steering certain tenants toward certain units, and otherwise showing deferential treatment to an individual or group of tenants can land you in trouble quickly. Landlords are constantly taken to court on charges of discrimination for actions like these. You don’t want to be one of them.
4. Failing to document. Keeping excellent records is a habit that can save your business. It’s vital to make copies of everything from driver’s licenses (if legal in your area), move-in/move-out inspections, applications, tenant screening authorizations and lease documents. But consider making notes of phone and text messages, emails and snail mail communications, too. Even a simple spreadsheet can prove to a judge that you treat all tenants equally and follow the law.
5. Not knowing when to call in the professionals. A licensed electrician and plumber, landscaper, lawyer, accountant, tenant screening service and possibly a property management company should be on every landlord’s list of resources. You may not need all of them all of the time, but you will likely need them at some point in running a rental property business. Trying to do it all has been the downfall of many a real estate investor. Knowing when help is needed in managing rentals can save your sanity—and maybe even some of your profit!
Posted by Teresa on July 20, 2010 under Landlord Paperwork and Forms, Landlord Tenant Lawsuits |
When Does a Landlord Need a Lawyer?
In short, landlords need expert assistance from landlord/tenant lawyers when a legal issue becomes serious or has the potential to be expensive. Here are several such scenarios:
When you’re starting out. It could be worth the extra expense to have your lease agreements, pet policies, security deposits and other legal documents prepared by a a law professional. You don’t want to discover during a tenant dispute that the lease you downloaded from the Internet is illegal in your state. And you don’t want to be sued for having discriminatory language on your lease. If you prepare your own lease documents or use publicly-available documents, you should at least have a lawyer review them before you use them.
When you experience your first eviction. Having an experienced attorney prepare all the required documentation the first time you evict a tenant is an investment in your landlord education.
When a tenant files a complaint. Sure, you can represent yourself. And if a tenant files a baseless complaint, you might just need to present the attorney-prepared documents with the tenant’s signature as proof of your innocence. But if things get sticky, if the complaint is regarding something serious like discrimination, or your tenant hires a lawyer, you might want to do the same for yourself.
When you want to reinforce a policy with a tenant. If you’ve done the phone call, email, letter routine to a tenant in violation of the lease, a quick letter from an attorney will often produce a quick result.
If you’re going into mediation or arbitration with a tenant or former tenant. It’s good to know your options, your legal standing, and what you can choose to compromise on when you go into the arbitration process.
If your tenant files a lawsuit for damages. You don’t want to take a lawsuit too lightly. Tenants who have been injured on your rental property, who have suffered losses due to your alleged negligence, or who have banded with their neighbors to file discrimination or other charges probably mean business. You probably don’t want to face serious charges without an attorney by your side.
Whenever things get dicey between you and your tenants, it could be worth the expense to hire a good landlord/tenant attorney.
Posted by Teresa on June 22, 2010 under Landlord Paperwork and Forms, Landlord Tips, Tenant Credit Checks |
If you’re a landlord who is not using written rental applications 100% of the time, here are 5 reasons why you should!
- The practice makes everyone more comfortable. Perhaps there was a time when a handshake and a handful of cash were all landlords needed to start a lease. But in this era of liability, lawsuits, and legal obligations, proper paperwork is just a must. And tenants expect to fill out some form of application, too. It puts them at ease that you’re a legitimate business person who will handle the landlord/tenant relationship professionally.
- It can protect you from liability. Requiring a rental application from each prospective tenant over age 18, as well as the names of all children who will reside in your rental housing, could reduce your liability for accidents or injuries that occur on the rental property. When your rental application clearly states municipal code limits on number of residents, fire code regulations, and emergency contacts for each tenant, you are more protected in cases of emergency.
- It can protect your rental business from a discrimination lawsuit. Collecting the same information from every prospective tenant, then using the same criteria to choose each tenant, ensures that you are within the guidelines for discrimination laws. If you just talk to prospective tenants, and choose one based on whoever is most able to pay the rent, you could be setting yourself up for a lawsuit. A lawyer for a rejected applicant might have a great case, since you’d have no documentation as to why you chose a particular tenant. When you have paperwork like applications and credit reports to back up your decision, you’re covered.
- You can gather the information you need to perform a thorough tenant screening. Rental applications should contain name, address, previous addresses, employment information, social security numbers, driver’s license numbers, and all contact information. They should also contain a signature page authorizing you to pull tenant credit reports and tenant criminal background screening reports.
- You get a commitment from a prospective tenant. When landlords show apartments and rental houses, they too often let a great prospect get away. Presenting the prospective tenant with an application form and request for security deposit to “hold” the rental unit is a good way to get a commitment. Then, you can do a tenant screening to confirm he or she meets your criteria before signing a lease or rental agreement.
Legal disclaimer:
The contents of this article are intended for general information purposes only, and should not be relied upon as a substitute for obtaining legal advice applicable to your situation.
Posted by Teresa on June 2, 2010 under Landlord Paperwork and Forms, Landlord and Tenant FAQs, Tenant Screening & Background Checks |
Leases begin and end; tenants come and go. Often, life interferes with details like legal documents (leases) and a tenant comes to you with an announcement: “I’m moving, but don’t worry—I found someone to take over my lease!”
For some landlords, this is when the worrying begins. For others, it’s not a big deal—having a new tenant without advertising and showing the rental unit is the best part about subleasing.
Subleasing is when a tenant assigns his or her lease to a third party; in effect, they are renting the unit from you, while renting it out to someone else.
To protect yourself, you should be aware of the following when considering whether or not to allow a sublease situation in your rental property:
1. Make sure the original tenant knows that a sublease itself does not release them from the original lease. If the sublease renter defaults on the terms, the original lessee is still responsible.
2. If you as landlord choose to release the tenant from the lease, then the sublease renter becomes responsible for rent and other obligations of the lease, and you become responsible for responding to the sublease renter’s needs under the lease.
3. In many cases, landlords do not release the original tenant from the lease, so the original tenant collects the rent from the sublease renter, and pays the landlord per the terms of the lease. The original tenant is also responsible for any damages to the property caused by the sublease renter.
4. You are still in control—not only can you approve or deny the applicant who wishes to sublease, but you can refuse to participate at all in a sublease situation. You then handle the tenant’s breaking of the lease agreement the way you normally do, whether it’s collecting the balance of the lease period’s rent, keeping the security deposit, or agreeing to let them out of the lease providing you find a new tenant.
5. Keep in mind that tenants don’t always inform landlords of their plans. Sometimes they move out and let their sublease renter move in—and you’re none the wiser. You are under no obligation to accept the situation, and after checking with your legal advisor, may be able to start eviction proceedings against the sublease tenant and the original tenant, too.
If your tenant asks about subleasing your rental property, check with your legal advisor first. To ensure you’re protecting your best interests, as well as your other tenants’, insist on full application procedures and tenant screening on the sublease renter.
Legal disclaimer:
The contents of this article are intended for general information purposes only, and should not be relied upon as a substitute for obtaining legal advice applicable to your situation.
Pre-screen all tenants as part of your standard application process. Background and credit checks will help ensure you rent to qualified tenants. For more landlord resources, including forms and information on tenant screening, turn to E-Renter.com.
