Being a landlord can be rewarding, but it can also be complicated and full of potential pitfalls. Some landlord mistakes can even result in legal action by tenants.

The following landlord mistakes are some of the most common legal errors landlords tend to make, as well as advice on how to avoid them:

1. Discriminating During Tenant Screening

The Federal Fair Housing Act protects tenants from being discriminated against on the basis of race, skin color, creed, religious affiliation, familial status, age, sex or a disability or medical condition. Questions or actions during the screening process that seem discriminatory could result in a lawsuit from the tenant or investigation by the U.S. Department of Housing and Urban Development (HUD).

Standard tenant screening such as criminal background and credit checks are fine, however the tenant should agree to these checks. A professional tenant screening service can assist in screening tenants to help avoid landlord mistakes and to ensure background checks are done properly and in compliance with the law.

2. Not Providing a Safe Environment

Landlords are required by law to provide an environment that does not have dangerous conditions or criminal activity. Making proper inspections and repairs are crucial in making sure a property is safe for all tenants. Quality locks, adequate lighting, and functioning heat and electricity are some of the basics required. The building as well as the roof and flooring should be structurally sound. Repairs should be made in a timely manner to ensure compliance and to avoid landlord mistakes. Tenant screening and criminal background checks can help with avoiding rental to criminal elements.

3. Disclosure Issues

While each state has different requirements, disclosure of specific issues with the property is often required. Mold in the property, lead-based paint, recent deaths in the unit and sex offenders living in the vicinity are all items that should be disclosed to ensure compliance. Checking the state’s specific laws around these issues is advisable so that all required disclosures are made to avoid landlord mistakes.

4. Disregarding Tenants’ Right to Privacy

Many states require landlords to give notice before entering a rented unit for any reason, usually at least 24 hours in verbal or written form, depending on the state. Acceptable reasons for entering a unit after giving the tenant notice are making a repair, showing it to a prospective new renter, or performing a warranted inspection of the premises. The only exception to entering without giving notice would be an emergency situation.

Being a landlord is an excellent business opportunity, but business must be conducted in compliance with state laws. Avoiding landlord mistakes and these four common legal errors is crucial to long-term success as a landlord.

Disclaimer: The information on this website does not constitute legal advice and is governed by our Terms of Use. We make no claims, promises or guarantees about the accuracy, completeness, or adequacy of the information contained in or linked to this website and its associated sites.

Landlords have a lot to look forward to with rent trends in 2016. Signs point to beneficial innovations in the industry as well as favorable conditions generally for renting properties.

The following are some of the top rent trends landlords can expect for 2016:

1. More “Millennials” Moving In

As the millennial generation continues to grow up, leave home and look for a place to live, landlords can expect to see more and more of them applying for their rental properties. This generation is characterized by the qualities of creativity, innovations and being tech-savvy; however, some can also have a short attention span. Tenant screening can assist in determining which millennial tenants have been responsible and organized with on-time payments to past landlords and other financial responsibilities.

2. The “Digitizing” of the Rental Process

Other rent trends to watch in 2016 are the movement of rental processes online. From listing a property for rent to answering questions and corresponding with potential renters, the process is more streamlined and efficient than ever before. There are even online property management software solutions to help streamline the process, from drawing in applicants to lease signing/management to taking care of rent payments electronically.

Sites like CraigsList, Zillow, PadMapper and Trulia offer free or affordable ways to list rental properties online and generate a high volume of applicants from which to choose. Tenant screening can assist in narrowing down the field to the highest quality applicants.

3. More People Looking to Rent

Rising real estate prices and mortgage rates are set to continue effecting rent trends in 2016, making buying a home less affordable and attainable than it once was. Attitudes are also changing regarding pursuing property ownership as part of “the American dream” as many Americans now see renting as a more favorable option. Qualifying for mortgage loans is also harder than in the past. All of these factors will contribute to a larger pool of potential renters from which to draw.

4. The Use of Professional Tenant Screening will Increase

The bigger tenant pool along with an online, streamlined and digitized rental process will give rise to the need for more stringent screening processes in order to find the best tenants. Professional tenant screening services will become more utilized in 2016, leading to increased business success and peace of mind for landlords.

More millennial tenants, a streamlined rental process, a larger pool of renters and the need for high-quality tenant screening are all expected rent trends for 2016. With an awareness of what’s ahead, landlords can make the most of the rental market this year.

Disclaimer: The information on this website does not constitute legal advice and is governed by our Terms of Use. We make no claims, promises or guarantees about the accuracy, completeness, or adequacy of the information contained in or linked to this website and its associated sites.

The best way to help guarantee success in a property rental business is by renting to the highest-quality, most trustworthy tenants possible. However, being a landlord takes on a much more personal tone when a property owner will be renting a room in their own residence. To be a successful landlord and find a quality tenant to help ensure harmony at home, landlords should screen potential renters in the key areas mentioned below:

1. Income Verification

While having a tenant write down information about their income is a start, actually taking a look at copies of their pay stub, W-2 or tax return allows for verification of the applicant’s pay. Their income should generally be three times or more of the monthly rent cost, but this can vary depending upon the economic climate of the area.

2. Agreement with Household Terms when Renting a Room

The homeowner is entitled to set the house rules when renting a room in their home. It is important that the tenant selected can and will abide by the house rules. From kitchen and laundry room policies to lifestyle to smoking/non-smoking, visitor, pet and cleanliness rules, the renter and the homeowner should be on the same page.

3. Their Past as a Renter

The names and contact numbers of the applicant’s last two landlords should be gathered via the rental application. Useful information can be gleaned by calling previous landlords and asking about the applicant’s reliability as tenants in terms of timely rent payments, their treatment of the property and whether they adhered to the property rules.

4. Employment References

The rental application should request the names and phone numbers of the applicant’s current employer as well as their previous one. Talking to past employers can help with verifying reliability and trustworthiness.

5. Personal References

Personal references can offer insights into the character of the individual. Personal references should not be family members; a college professor, clergy or other mentor figures could qualify as personal references.

6. Credit History

Checking into an applicant’s credit history, background and references requires getting their written permission. This can be done via the rental application. Once permission is granted, the landlord can pull their credit report themselves, or allow a tenant screening credit reports service to take care of it as part of a screening package. Late payments and other negative entries on a credit report are major red flags.

7. Criminal History Check

This step is especially crucial when renting a room and living under the same roof with a tenant. While public criminal and national eviction records can yield some information, a professional tenant screening service can ensure a complete and comprehensive criminal history check.

Landlords who are renting a room in their own homes have some special considerations. Screening in these seven areas can help with finding a tenant who will be an ideal fit.

Disclaimer: The information on this website does not constitute legal advice and is governed by our Terms of Use. We make no claims, promises or guarantees about the accuracy, completeness, or adequacy of the information contained in or linked to this website and its associated sites.

One of the key ways landlords can gain insights into the reliability of rental applicants is by contacting the previous landlord. The way a tenant acted in the past can be a strong indicator of how they will conduct themselves in the future.

Beware of Previous Landlord and Tenant Fraud

However, while calling the previous landlord is important, it may not always glean honest information. If a tenant is squatting at their current residence without paying rent while looking for a new place to live, some landlords will give a glowing review just to get the tenant out of their hair.

While these assessments should be considered, the screener should be aware that what past landlords say may not tell the whole story. It’s best to weigh the information along with testimonials from landlords from the more distant past as well. Character references and data provided by a reputable tenant screening service can augment this information to give a more complete picture of the rental history of the applicant.

Some prospective tenants may also enlist a friend or family member to pose as a previous landlord and give a glowing review of the applicant. Verifying past addresses and landlord phone numbers can be attempted via a search engine, but these results aren’t always reliable. A credit check or tenant screening report can give a more transparent view of where the tenant has lived and who their real landlords were so their history can be verified.

Covering All the Bases

Landlords must receive permission from the applicant to contact previous landlords, and most will ask that a copy of this release be emailed or faxed over before they will reveal any information about the individual. However, some key questions to ask them might include:

1. When exactly did the tenant rent their property?

2. What was the tenant track record in terms of on-time rent payments?

3. In what condition was unit when they left?

4. Did they receive their entire security deposit back (and if not, why)?

5. Did any neighbors ever complain about them?

6. Did they give adequate notice before vacating?

7. Would the landlord rent to them again?

Gleaning insights about rental applicants from past landlords is a key step in connecting with quality tenants. A tenant screening service is another important way to verify the information provided by a previous landlord and avoid problem renters.

Disclaimer: The information on this website does not constitute legal advice and is governed by our Terms of Use. We make no claims, promises or guarantees about the accuracy, completeness, or adequacy of the information contained in or linked to this website and its associated sites.

There’s no denying the importance of screening prospective tenants before approving them for an apartment lease or other residential property rental. After all, tenant screening can help weed out applicants who pose a financial risk to the property manager or who simply have a less-than-ideal criminal record.

Even among property managers who screen their applicants, however, there are some serious mistakes that are all-too-common.

1. Being Inconsistent with Procedures

One of the biggest mistakes some property managers make when they screen prospective tenants is simply not applying the same screening guidelines and criteria to everybody. For example, one property manager might think it’s okay to let a close friend bypass the application and screening process; after all, he knows the applicant well enough and isn’t worried about the applicant’s financial or criminal history.

Unfortunately, if the applicant is approved without screening and another prospective tenant (who was screened before approval) finds out, this could be grounds for an expensive discrimination lawsuit.

2. Overlooking an Applicant’s Credit Report

Another mistake that far too many property managers make is that of overlooking an applicant’s credit report. Instead, they may simply run a credit check to verify that the applicant is currently making at least three times the monthly rent (that’s the standard in the rental industry) before assuming he or she is financially responsible enough to make consistent rental payments.

However, if that property manager had bothered to look more closely at the prospective tenants credit report, it may have been discovered that the applicant has been late or outright missed several rental and credit card payments in the past–and that he or she is a serious financial risk for the rental property.

3. Not Asking for Bank Statements

Finally, it’s extremely important to ask for copies of an applicant’s recent bank statements before approving them for a rental unit. After all, while the prospective tenants place of employment might verify that he or she makes a comfortable salary, property managers have no way of knowing how much of that person’s salary is tied up in other financial commitments.

By taking a look at an applicant’s bank statements, it’s possible to see what the prospective tenant’s free cash flow is like and whether or not he or she has a substantial amount of money reserved in a savings account. This can give property managers a good idea as to whether or not the person would make for a reliable tenant.

By avoiding these common tenant screening mistakes and investing in quality screening software, property managers can enjoy greater peace of mind when processing rental applications.

Disclaimer: The information on this website does not constitute legal advice and is governed by our Terms of Use. We make no claims, promises or guarantees about the accuracy, completeness, or adequacy of the information contained in or linked to this website and its associated sites.