Whether you're looking to make a little extra money, or are just waiting for the market to turn around before you sell, there are benefits to renting additional property you own. While being a landlord has its perks, there is some risk involved. If you're renting your property, or are thinking about doing so, there are some things you can do to make sure you protect yourself. Rental History Reports provides tenant screening and other resources to small landlords looking for ways to protect their investments. The company offers the following advice on how to avoid five common mistakes landlords make:
1. Not screening your tenants Failing to run a tenant background check is perhaps the biggest mistake you can make as a small landlord, as it will help you avoid numerous other mistakes. Screening tenants is easy and affordable, and you can choose packages that best suit your situation. When you use a tenant screening service, you should be able to find out if your prospective tenant has a criminal record, previous evictions or any other red flags that might hamper their ability to pay their rent.
2. Eschewing paper work
In the legal world, if it's not on paper, it might as well have never happened. No matter how much you might trust a potential tenant, making them sign a lease is absolutely necessary. If you're unsure about the type of language you should include in the lease, you may want to consult with a legal service that can help you. 3. Staying far away from the property
You might think you're intruding on your renters if you visit often, but good renters will be happy you care about your property. If you're keeping the place nice, your renters will be happy to see you. And if your renters don't welcome your visits, you may have reason to be concerned. 4. Unknowingly violating the Fair Housing Act While it's important that you protect yourself by learning about prospective tenants' legal status and rental history, there are certain things that you can't ask. Familiarize yourself with the Fair Housing Act to learn what types of questions to avoid. For starters, questions about race, ethnicity, religion, sexual orientation and family situation are off limits. Asking such questions could open yourself to legal action if you turn down the person's request to rent your property. 5. Ignoring important repairs
When you're renting out your home, it's tougher to notice things that need to be fixed when you're not living there. Establish with your prospective tenants that you want to be made aware of any issues so you can fix them promptly. It's also important to make sure fire alarms, locks and other important items that make a home safe are working properly before you turn the keys over to your tenants - you could be held legally responsible if they aren't.