As a landlord, you’re likely dealing with new challenges that you wouldn’t really have to face as a homeowner. Landlords are often at the mercy of financial penalties, legal issues, and even criminal charges if they fail to follow strict and rapidly evolving property regulations.
Some of the most costly legal mistakes will occur early on in the tenancy, due to rushed processes or a lack of understanding of legal obligations. That includes tenancy deposit protection and safety regulations.
Inadequate tenant screening
If you’re failing to properly screen any of your tenants, then this can lead to problems with those tenants, such as chronic rent arrears, costly evictions, and property damage to your home.
When you rush the screening process, it can result in violating fair housing laws. Some landlords will fail to do the bare minimum, like checking criminal/credit history, or they may end up using inconsistent screening procedures that violate the Fair Housing Act.
Make sure to establish a written, objective tenant screening policy applied equally to all of your applicants. Run background, credit, and eviction checks, making sure to verify employment as well as landlord references too.
Violating security deposit rules
With deposit disputes, these tend to be the most common source of litigation that occurs between tenants and landlords.
Not placing those deposits in a separate, interest-bearing account or failing to return deposits within the state-mandated timeframe will be violations. That and illegally making deductions from the deposit, too.
To avoid all of this, you’ll want to make sure to understand the specific deposit regulations of the municipality and the state you’re in. Make sure to document all of the property’s condition with photos and videos before moving in and moving out.
An itemized list of deductions to the tenant needs to be provided within the legal timeframe of 14-30 days.
Improper eviction procedures
If you’re trying to force a tenant out without the use of a court order, even in the case of non-payment for rent, it’s considered a criminal offense and one that is so in many jurisdictions.
Changing the locks, shutting off utilities, or removing tenant belongings can put you in some serious trouble.
Instead, you should be following the legal process as strictly as possible. From serving formal, written notices to filing an unlawful detainer lawsuit if the tenant refuses to comply.
The last thing you want to do is threaten or harass a tenant to move out of the property. A real estate lawyer can be helpful in situations where you need legal aid for tenancy problems.
Ignoring property maintenance and safety hazards
As a landlord, you’re legally responsible for maintaining a premise for your tenants that habitabl, especially when it comes to safety hazards.
If you neglect maintenance, delay necessary upgrades, and ignore repairs for safety, like smoke/carbon monoxide detectors, for example, then you could get into trouble.
Try to adopt a proactive maintenance plan rather than one that’s reactive.
Using generic or illegal lease agreements
Finally, make sure that your lease agreements have been properly drafted. A poorly drafted one can make it impossible to enforce rules or evict a tenant for violations.
To help ensure the efficiency and legality of a lease agreement, instruct an attorney licensed in your state to review the agreement to make sure everything noted is correct and nothing is missing.
You’ll want to take your role as a landlord seriously, as failure to do so could risk your own financial wealth as well as the rental.
