Landlords' Legal Rights & Duties
Owning a rental property can be a great investment, and an important component of your long term financial plans. However, renting your property out to tenants can carry some risks, and it is important to be well-informed before undertaking this responsibility. As a landlord, you should become familiar with the basic documents that will set forth the terms of your tenancy, know how to screen for good tenants, understand your rights and duties as a landlord as well as those belonging to your tenant(s), and be aware of how tenancies can legally end, among other things.
Leases and Rental Agreements
Before you begin looking for tenants, you will likely need to determine whether you plan to offer a monthly rental agreement or a lease with a longer term. Month-to-month rental agreements generally renew automatically every 30 days unless one of the parties gives 30 days’ notice that they wish to end the tenancy or change any of the other terms, such as the amount of rent to be paid, though some states require more notice. Leases typically cover longer periods of time, such as 12 months or more, after which time neither party is obligated to continue the tenancy though they can sign a new lease if they choose to. A tenant who signs a lease agrees to live in and pay rent on the rented premises for the full duration of the lease, and the landlord agrees not to raise the rent during the lease period.
Both month-to-month rental agreements and longer term leases establish in detail all of the rules and protections that will apply to the tenancy. Leases provide more stability for both parties, but monthly rental agreements can provide the flexibility to end the agreement after a shorter period of time if either party so desires. Any lease or rental agreement should clearly define who the parties to the agreement are, whether there will be single or multiple tenants, and whether subletting or assignment will be allowed.
Screening Tenants
As a landlord you will want to find reliable tenants who have good credit and secure income, and who will respect the terms of their lease or rental agreement. Prospective tenants should fill out a rental application, and you will want to obtain and review a credit report for each applicant. It is also critical to verify a prospective tenant’s identity, and it can be a good idea to check local court or other public records to determine whether an applicant has a history of eviction or collection actions, or any relevant criminal history. When screening prospective tenants it is important to be mindful of federal anti-discrimination laws that make it illegal to discriminate based on factors including race, color, national origin, sex, religion, age, disability, or familial status. State and local laws in many jurisdictions prohibit discrimination based on sexual orientation or gender identity. Further, state and federal protections mandate reasonable accommodations for tenants with disabilities.
Rights and Duties
An agreement between a landlord and a tenant establishes the rights and responsibilities of both parties. State and local laws can vary, but as a landlord, you will generally be responsible for providing your tenants with a “habitable” dwelling, meaning that basic requirements for human occupancy such as having electricity, running water, a pest-free environment, and secure windows and doors must be met. Your rental unit should be comfortable and safe, and it is especially important to remove dangers to children. In many jurisdictions, tenants can withhold rent if these requirements are not met, and you can be fined for failing to cure housing code violations of this nature. You may also be held liable in the event that a tenant is injured due to unsafe conditions in your rental property. Further, it is important to keep in mind that tenants have a right to “quiet enjoyment” of the premises, meaning that you generally must give at least 24 hours’ notice or have the tenant’s permission before physically entering the rental property to make repairs or for other reasons.
Ending a Tenancy
In most situations, the terms of your lease or rental agreement will determine when and how a tenancy will end. Both types of agreements often require 30 days’ notice if either party intends to leave or change the current arrangement. If the tenant is moving out and has left the property undamaged, you will generally need to return their security deposit within a certain amount of time as determined by state or local law; failure to do so can lead to a small claims court action being filed against you.
Sometimes tenants do not abide by the terms of their lease or rental agreement, either through failure to pay rent, damaging the property, disturbing other tenants, or engaging in criminal activity on the premises, and you need to pursue an eviction. Depending on the severity of the violations, you may not need to give the tenant more than five or ten days’ notice to move out. In most states, if the tenant won’t leave, the landlord must file and win an eviction lawsuit in order for law enforcement officers to physically facilitate the eviction. Even if you win a monetary judgment against the tenant, it is possible that you will later need to pursue a collections action in order to actually obtain the money the court has awarded you.
