What could go wrong, right? When you’re dealing with rental property, perhaps the better question is “what won’t go wrong?” The fact of the matter is, there are lots of things to look out for as a residential landlord, from the initial screening process of prospective tenants, to getting rid of the tenant who just won’t pay the rent. With laws constantly changing, it can be hard to keep track of your rights and responsibilities as a landlord and the legal procedures you must adhere to.
The current real estate market has forced many homeowners into the landlord business. Often, it can take a seller 9-12 months or longer to find a buyer for their home. Many sellers, after months of frustration, turn into inexperienced landlords by default, renting their house out to complete strangers. So as a landlord, how can you protect yourself from legal issues down the road and help the arrangment be both profitable for you and enjoyable for your tenant? Read on….
1. Avoid knee jerk reactions while looking for a tenant. Before you start the tenant search, have an approval process plan and stick to it. It is always a good idea to require the prospective tenant to fill out an application, detailing their past tenancies, social security number, and current employment information. Those are probably the three most important pieces of information because they can help you at virtually any stage of the rental process if things go awry. A quick call to their prior landlord will probably tell you most of what you need to know about their worthiness as a tenant up front. Their social security number and employment information can help you recover unpaid rent from them in the future. It is also a good idea to obtain the prospective tenant’s written permission to run a credit check. Knowing how financially stretched he or she is will tell you from the start the odds of getting your rent on time or at all.
2. Before you sign a lease with a tenant, have an attorney review it. State law governs the provisions of a lease and the interpretation that courts will give them later on. There are many very popular provisions that appear in leases that are illegal in
. For instance, did you know that it is unlawful (and subject to monetary penalties) to include a lease provision requiring the tenant to pay attorney fees in the event of an eviction action? Or that it is unlawful in most situations to require a deposit in excess of the monthly rent? An attorney familiar with the ever-changing landlord-tenant laws can quickly determine deficiencies and/or provide you with a court-tested lease. Alabama
More tips on being a successful landlord, including understanding your rights and responsibilities as a landlord and how to deal with a bad tenant, will appear in my next blog post.