Rent Your House: Tenant Screening, Landlord Laws, and More

Do you have investment property that you'd like to rent? Or are you traveling and need to rent your house while you're on the road? Whatever the reason, renting your home for part of the year, or for a longer period of time, generates great income. Because you are renting your home, as opposed to a property specifically designed for renting, you will want to be more careful with the terms you set in the lease.

Here are the steps I recommend if you getting ready to rent your house:

1. Consider hiring a rental agent. A rental agent will take down the information pertinent to your house, advertise the listing, review any potential tenants that submit an application and present them to you. The rental agent will likely charge a fee, ranging from a half-month to a full-month fee for this service. A half-month fee represents one-half of one month's rent, while a full fee equals one month's rent. When and if your rental agent secures a suitable tenant, this amount will be deducted from the amount you receive from the tenant at the signing of the lease. Agencies usually choose one of three options: charging only the landlord a full-month fee, charging only the tenant a full-month fee, or splitting the fee between the two (two half-month fees). Make sure you are clear on the fee structure before you sign any contracts or make any agreements. If you decide against a rental agent, you may want to invest in property management software, which should include free rental forms,  to help you stay organized.
2. Tenant screening: credit, employment, landlord verifications. If you have a rental agent, she will perform a credit check, call past references and verify employment and wages as part of the tenant screening process. After the review is complete, she will present her results to you and, based on that information, you can choose to accept or deny the applicants. If you do not have a rental agent, you can follow these tenant screening steps yourself, but you will need an agency to perform the credit check. Pay careful attention to the rental applicant's credit and employment history. If the potential tenant has poor credit or is not making enough to afford rent comfortably, you should consider finding a different tenant. If the rental applicant's past landlord (not present) gives a poor recommendation, think twice.
3. Length of lease. Once you have decided on an rental applicant, determine the duration of the lease. After signing the lease, it is difficult to terminate the contract.
4. Furnished or un-furnished. Decide whether you want to let the tenant use your furniture or if the apartment will be delivered vacant.
5. Pets or no-pets. If you do not want pets in your home, make sure to include that information in the lease. If, on the other hand, you have a clause in the house rental agreement allowing pets, make sure you put a limit on the number and kinds of pets.
6. Deposit, deposit, deposit. If your tenant has questionable credit, has a pet or is using your furniture, make sure to ask for a hefty deposit. Even if the tenant has perfect credit, gainful employment, is a non-smoker and has no pets, you will want to take a deposit. If the tenant can pay first month, last month and security, you are smart to take it.
7. Inform your neighbors. If you are renting out a home that has been your long-term residence, be sure to inform your neighbors. Regardless of the length of the lease, neighbors may get confused when they see strangers using your garage, so send a letter or make a house call to prevent any problems.