May 10, 2014
Being a landlord you constantly have to deal with people. The more units or larger the project, the more people you have to deal with on a daily basis. There’s so much that needs to be done all the time that it is easy to let the little things slide, which is a huge no no.
There are some things that you just shouldn’t do when it comes to interacting with your tenants, things that can have long term financial and legal implications.
This is our list of the top 5 don’ts of Landlording.
Do not keep the Deposit as the last month rent
Seems like a simple thing, closing off the deal, no hassles, easy for both sides. Legally there are only a handful of states that allow the utilization of the deposit. There are very strict rules when it comes to the return and reimbursement of the deposit to the tenant. Not only it is not legal it’s going to make a serious mess of your taxes. There’s a difference between rental income and the deposit which technically is not income. If you mix the two up, you are going to be neck deep in all kinds of tax related paperwork just to sort out this little detail.
Don’t go in the Tenant’s house Uninvited
There are strict privacy laws that safeguard a tenant from invasion of privacy. Please make sure that you don’t simply pop in to have a quick look as that could lead to legal ramifications. The exceptions are in case of assisting law enforcement or in case of fire or any other hazard. That’s a whole different matter entirely; in those cases you are obligated and there are no legal ramifications. But in case of a general visit, a Landlord is required to give notice in advance to visit the premises.
Obviously there’s no real need to be that much of a stickler for the rules, if you have a good relationship with your tenants this rule is never even going to be a problem, but just in case it’s always better to be safe than sorry.
Don’t Collect Rent from a Non tenant
The following can be the two basic kinds of situations where you could be understood as taking a rent from a non tenant.
Either in case of a person who might live in your property without a lease
Or the family member offering to pay instead of the original signer of the lease.
There are legal implications for both situations that should not be overlooked. First, you should not allow anyone to live within the residence without a lease-PERIOD. Once a tenant’s lease has expired you can send them the eviction notice, and withhold the deposit until they vacate the premises then conduct after departure assessment in present of the lease holder.
If a person living in your property is having their parents or a family member or someone else pay the rent in their stead, you can ask them to mail the rent directly to you. If a non-tenant gives it to you, record it as their transaction or ask them to co sign the lease making the direct interaction valid; and under the terms of the agreement absolving you from any adverse legal implications.