Basic Paperwork for Landlords

By E-Renter Tenant Screening
Posted on April 9, 2009 under Landlord Paperwork and Forms | Be the First to Comment

Keeping files in perfect shape is an elusive goal for most of us. But for landlords and property managers, a reliable record-keeping system is a must. If your strengths lie in areas other than document tracking, you may want to consider a property management company, rather than managing income property yourself. 

Rental property owners who manage things themselves will benefit from strong record keeping skills. Start with a basic filing system, with separate sections for each rental property you own. Your local office supply store will be full of options, from simple accordion folders, boxes, and plastic tubs, to locking filing cabinets. When you outgrow your simple system, it’s a good idea to invest in fireproof, locking cabinets.

All property ownership documents, such as purchase offers and contracts, appraisals, loan documents, and insurance policies, should be accessible and protected. Store these items separately from the rental paperwork for the property. Keep accurate records of any incidents or claims against your insurance coverage.

Track income and expenses manually, or on spreadsheets. Or consider one of the many financial management or property management software packages available. Software varies in price range and features; check out a few to see which works best for you; or ask around to see what other landlords are using. Reports, correspondence templates, income and expense tracking, and other features may make a software package a good investment for you. But even if you track all your expenses electronically, paper receipts are still required for tax purposes. Keep them in expense folders for each property.

You’ll also want folders for all rental and tenant documentation. These include maintenance records, tenant applications, rental agreements, legal notices, and tenant correspondence. You never know when you’ll need proof of notices, complaints, or maintenance.  If you are involved in a court dispute with a tenant, your good record keeping will definitely pay off. You don’t want to be in a situation where it’s your word against your tenant’s!

Rental property records should be maintained for three to five years, depending on the state where you live and/or own property. Property purchase and capital improvement records should be kept for as long as you own the property. Any records pertaining to injuries, evictions, or other legal matters should be maintained indefinitely.

Setting up and maintaining an efficient record-keeping system will pay off again and again. If you find yourself in court with a tenant or in an IRS audit, you’ll be grateful that your records are well organized!