The Laws of Being a Landlord
If you don’t follow state, local, and federal laws as a landlord, you open yourself up to a lawsuit from tenants. Landlord-tenant laws are set up to protect tenants’ rights. This allows them to live peacefully in a home. At the same time, they protect your property investment and rights as a landlord. Landlord-tenant laws change frequently and are location-specific. This overview will offer a basic primer on what you need to know before you rent out a home.
Fair Housing Act
One easy way to comply with the Fair Housing Act is to use a standard rental application for all tenants. This means you never accidentally ask about something like national origin or disability.
Fair Credit Reporting Act
Credit reports can be powerful checks and balances on bad tenants. But under the Fair Credit Reporting Act, you must obtain an applicant’s permission to check their credit. You are then obligated to let them know if you denied their application due to something on their credit report.
Some states place restrictions around security deposits, which you may collect as a safeguard against property damage. For example, a state may place a limit on the amount of money you can collect by saying that the security deposit cannot exceed the rent amount. A state may also require you to place the funds in an escrow account, rather than in your personal account. If you don’t follow security deposit laws, you may not be able to withhold money from the deposit when a tenant leaves.
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If a tenant breaks the lease or stops paying rent, you have the option to evict them. With eviction, you must follow all laws, which are state-specific.
For instance, most states require you to first serve tenants with a Notice to Quit. At this point, you wait the specified time frame before you can proceed with the eviction. If you don’t wait long enough, or serve the Notice to Quit in the appropriate manner, you may need to start the eviction process from the beginning.
It goes without saying that while this is happening, your tenant may have stopped paying rent, complicating your cash flow. You may need to cover the mortgage yourself until the matter is resolved and you can re-rent the property. If you find yourself needing to evict a tenant, seek help from a landlord-tenant lawyer.
If the laws associated with being a landlord are too overwhelming or too intricate, HomeGo can help. As the largest national home buying company, we can purchase rental properties to relieve you of unnecessary stress. Call today to get your offer started.
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