Business Blog for Entrepreneurs Real Estate  7 Tips For a Solid Rental Agreement

 7 Tips For a Solid Rental Agreement

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Owning a home to use as a rental property has the potential to bring in residual income while you work at your full-time job, but the endeavor can become stressful and frustrating if rules aren’t laid out. Being a landlord to a tenant requires you to understand the rules and regulations for your state along with deciding what you do and don’t want to allow in the home. Establishing rules in your lease gives your tenants a clear picture of what you expect from them, and protects your rights as the owner.

  1. Establish Due Dates

Make it clear in the lease how much rent is due and when you expect it by. This could be on the first of the month, the first Friday of the month or whatever else works for you. Specify after how long a late fee applies and how much the fee is for if the rent isn’t paid by the due date. You may also wish to include a grace period for a bit of flexibility.

  1. Include Rights to Entering the Property

Laws in each state protect a tenant’s privacy by requiring a certain amount of notice before you can go into the property. It is usually 24 hours and should be included in your agreement to establish when and how far in advance notice must be given before you can enter the property. Ensure that your lease complies with the laws of your state.

  1. Outline Ownership

Make a note of what is included in the dwelling whether it is furniture, appliances or something as simple as drapes and blinds. You don’t want the tenants to take anything that doesn’t belong to them when it is time to move out because these items can be costly to replace.

  1. Address Garbage Removal

Garbage starts to smell quickly and becomes a nuisance if it is not taken care of properly. List whether the tenants or you are responsible for garbage removal and the days that it is picked up. Give all available information to the tenants to ensure that they know where garbage and recycling should go and who is responsible for the cost.

  1. Outline Rules Relating to Pets

Many renters have some type of pet ranging from cats to dogs to fish and even ferrets or birds. If you plan to allow pets, list what types are permitted and if you have any restrictions on size or breed. Include a code of conduct, such as requiring tenants to have their animals on a leash in public spaces and a requirement to clean up messes in and around their yard. It can also be beneficial to require an additional security deposit to cover damages that pets can cause.

  1. Lay out Smoking Rules

Most landlords now specify whether they will allow smoking in the home or not. Allowing smoking might decrease the value of your property because of the resultant odor and stains. While you may decide to not allow smoking, you might opt to allow vaporizing (vaping) instead. A vape pen with a vape box mod could be a better alternative to smoking because of the absence of odor and stains. Vaping is better for keeping your home’s value up because vaping keeps the carpet and walls in better condition without staining and odor from tar and nicotine.

  1. Specify Time Required for Notices

Specify how far in advance you require a notice that the tenant is going to vacate the premises. A typical period is thirty days, which gives the tenants time to move and you time to find new tenants so you aren’t losing money on an empty property the next month. A lease that extends for a long period of time, such as a year, gives you peace of mind in knowing that you have a tenant until at least the end of the lease’s term.

Becoming a landlord can be overwhelming if you’ve never done it before. There are responsibilities, new territory and it is a learning experience that can be rewarding if you take your time to learn the ropes. Having rules and expectations laid out in black and white gives both you and your tenants a resource to look to if any disputes occur.

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