Every state is slightly different, but they all require that a landlord give notice to a tenant for several important events. It is important that you have these notices on hand so that you are not scrambling at the last minute to put them together. Most states require that the landlord provide a notice of late payment and an eviction notice prior to filing a suit to recover your property. You may also be required to provide a notice prior to the end of the lease term if you intend not to renew the lease with the tenant. Finally, you may be required to provide notice if you intend to raise the rents. Make sure you contact an attorney in your area to provide you with a list and maybe templates of the most needed notices.
The Tenant Application
As a new landlord you are probably anxious to get your first tenant, but how do you know this is the right tenant. To make sure you have the right tenant, create a Tenant Application. The Tenant Application allows you as the landlord to gather information about a potential tenant without creating a contractual obligation like a lease. So long as you keep the information private and use it for the purpose of evaluating the tenant, there is no risk to you. Make sure you request financial information, references and background information. Make sure you include authorization to run a background check including a credit report. Consult an attorney in your area to ensure that your application meets the requirements in the law of your state.
The Walkthrough Addendum
May new landlords are to busy looking for a tenant they forget to protect their new property. Having a walkthrough addendum along with the lease will ensure that you, as a landlord, have a record of the condition of your property prior to leasing it to a tenant. In this manner if there is any dispute as to the condition of the property after the lease term has ended, you have a clear picture of its condition prior to the lease. The walkthrough addendum is a critical portion of the lease and should not be overlooked. You can probably create this on your own, but make sure it covers everything found in the property prior to the signing of the lease agreement. Although not a legal document it can become legally significant in a dispute.
The Itemized Security Deposit Return Letter
This pitfall may have a long name, but it can cost so much more. Some states require that a landlord itemize how the security deposit was applied to the repairs after a tenant's lease term has expired and the tenant has moved out. Failure to provide the itemized list could result in a significant fine and/or recoverable damages to the tenant. It is astonishing how many landlords fail to provide this letter. Instead they opt to either use the entire deposit without providing an itemized list risking a lawsuit or return the entire deposit to avoid a lawsuit. So long as you create a list of the repairs that needed to be done to the property to bring it back to a habitable condition and provide that list to the tenant within a reasonable amount of time (sometimes specified by statute), your have covered all your basis. Please consult an attorney in your area to ensure that the itemized list complies with any statutory requirements in your state.
The Lease Agreement
It is amazing to me how many of the landlord clients I represent fail to have a written lease agreement or have a generic lease agreement from the internet. The lease agreement is the most important document if you are a new landlord. At a minimum you should have an attorney draft it to ensure that it is tailored to your needs, risk, and property. Leasing a property on a handshake is no longer considered smart, no matter how much you trust the person. The lease agreement is not about trust. It is about protecting your investment and your tenants. If you are a new landlord or thinking of becoming one, make sure you contact an attorney to draft your lease agreement. I can guarantee it will save you money in the end.