Renting out property can be a great investment, but it also comes with legal responsibilities. As a first-timer, you’ll want to educate yourself on landlord-tenant laws to avoid any costly mistakes. Here are nine key legal tips to help you successfully start your landlord journey.
1. Understand Your State and Local Landlord-Tenant Laws
The first thing any landlord lawyer will advise is to learn the landlord-tenant laws in your state and municipality. Rules vary across different areas, so you need to know the specific regulations like notice requirements, allowable fees, and bases for eviction. Spend time studying resources like state statutes, municipal codes, and reliable online summaries. Consulting a local landlord lawyer can also help demystify the rules.
2. Use a Lease Agreement for All Tenants
Having a thorough written lease agreement is essential for protecting your legal rights as a landlord. Never rent to a tenant, even for a short time, without having them sign a lease. Include details like rental rate, security deposit, length of occupancy, and conditions for terminating tenancy. Remember, leases are legally binding contracts once signed, so work closely with your landlord lawyer to ensure yours complies with all state and local regulations.
3. Conduct Proper Tenant Screening
Tenant screening is crucial for avoiding problem renters who could cause legal issues down the road. Require all applicants to fill out a rental application
Consulting your landlord lawyer can help ensure your screening process follows fair housing laws.
4. Handle Security Deposits Correctly
Mishandling security deposits is one of the most common legal mistakes made by newbie landlords. It’s essential to understand the laws in your area regarding deposit limits, handling, and refunds. Collect a deposit no larger than your state allows and store it in a dedicated security deposit bank account. When a tenant moves out, inspect the unit and provide an itemized deduction list for any retained deposit amount within the legally mandated time frame.
5. Avoid Illegal Discrimination
As a landlord, you must abide by fair housing laws that prohibit discrimination against protected classes. Never refuse to rent to or treat tenants differently based on their race, color, nationality, religion, sex, familial status, or disability. Develop uniform, objective criteria for tenant selection and apply them consistently. If you ever have concerns about violating discrimination laws, consult a landlord lawyer.
6. Maintain Habitability Standards
Most states require landlords to maintain minimum habitability standards that make a rental unit livable for tenants. Become familiar with your state’s implied warranty of habitability laws. Provide essential functions like water, heating, cleanliness, pest control, and adequate appliances. You could face legal action from tenants if you fail to fix hazardous or unsanitary conditions in a timely manner, so stay on top of necessary repairs.
7. Limit Entries Into the Rental Property
While you have a right to access your rental property at reasonable times, tenants also have a legal right to quiet enjoyment without excessive intrusion. Only enter occupied units when absolutely needed for repairs or maintenance. Always provide proper notice before entering as required by your state laws. Knock and announce yourself before going into a tenant’s unit. Avoid entries outside of daytime hours unless it’s an emergency.
8. Follow Proper Eviction Procedures
If you ever need to remove a tenant for lease violations, you must follow your state’s formal eviction steps exactly. Never try self-help measures, like changing locks or shutting off utilities to force a tenant out. Begin with providing proper written notice stating the reason for eviction and giving a window to correct the issue. If they don’t comply, proceed with formally filing for eviction in court to get a judge’s order before removing the tenants.
9. Keep Records for Your Protection
Keep accurate written records related to each tenant for legal protection. This includes their application, lease agreement, security deposit records, maintenance requests, and completion, any notices given, and more. Thorough documentation prevents legal disputes and helps you prevail if a tenant pursues claims against you. Always provide tenants copies of any notices as well. Check with a landlord lawyer to ensure you’re keeping all necessary records.
Renting out property for the first time comes with a learning curve. Following these key legal tips will help prevent you from making costly mistakes as you embark on your landlord journey. Be sure to consult a trusted landlord lawyer anytime you have questions about complying with legal regulations in your area. With some education and preparation, you’ll be on your way to successful and hassle-free renting. According to Flex, the average landlord owns three properties. Call us to schedule a consultation when you need legal guidance as a landlord.
