Property Management, Tenant Selection, Real Estate News & Tips

Lawsuit Avoidance 101

By on July 29, 2014 in Education with 0 Comments

lawsuitNo landlord ever wants to get notice that they are being sued by one of there tenants. With that being said, landlords must take every precaution to ensure they are following all of the local and federal laws in place. There are general guidelines that rental property owners or landlords must follow to avoid possible lawsuits from tenants.


  • Screen your prospective tenants

If your prospective tenant seems too good to be true, then he or she may not be a trustworthy individual. It is amazing that in the screening process, a few simple questions can help you tremendously in assessing your tenants. You can ask about their previous leases and experiences from their past landlords. The most effective way to know about your potential tenant’s background is to use tenant screening. By screening your tenants, you will know if they have been involved in any crime and if your tenants are who they say they are. Aside from that, you can also get immediate and direct access to the tenant’s credit and criminal reports if any exist.


  • Always put your lease in writing

You may have heard of rental leases that are done through handshake deals. And, you would be amazed that some of these handshake deals have really been successful. But many times those  “handshake deals” fail. When you follow up with your tenants about certain agreements you made with a handshake, they tend to forget or worse deny that you made those deals. For instance, your tenant agreed on your rental fee. But, when the time comes to pay the rent, the tenant refuses to pay the agreed upon amount because they think that it is too much or don’t have enough money to pay the rent. Without a lease, there is no legal proof that he or she agreed to your rental fee. This can really be a headache for you as a landlord. That is why, an agreement between you and your tenant must be documented in writing and signed by the two of you. When a written lease is in place and your tenants fails to follow what you have agreed upon, you can easily confront them and show them the signed papers of your lease agreement. The lease, if written correctly, will also help you avoid losing a lawsuit if one is filed against you because it is a legal document that should be designed to protect you. To be sure, your lease is a solid legal document investing in property management software will certainly provide you with resources to put together a rock solid lease. Not to mention, provide a platform to record all the important data and eliminate the loss of records related to your rental business and tenants’ accounts.


  • Make lease contract renewal and overholding obligations clear. Always make sure that the obligations for renewing your tenant’s lease contract are clearly spelled out. You must put on the lease contract the number of months or weeks your tenant should inform you if they plan to terminate the contract or renew it. If they want to renew their contract, then ensure that the terms and conditions are still relevant and are stated clearly. If not, make sure that your overholding clause is clear. Make your tenant understand how many months or weeks he or she is allowed to stay in your unit before he or she can vacate the place. Moreover, you and your tenants should keep in mind that tenants who overhold a rental unit after receiving or giving notice to vacate are liable to pay double their normal rent payment. And please, NEVER forget to have your tenant sign the contract.


  • Know the law. Rental property laws vary from state to state. As a landlord, it is important that you are familiar with the landlord-tenant laws in your area. You need to know all the laws about rental properties, obligations and rights as landlords/tenants, security deposits, eviction laws and more. Remember, violating even one of your tenant’s rights can lead to a dissatisfied renter, and worse you might find yourself facing a lawsuit.


To protect yourself from lawsuits, make sure to get rental property software that can provide you with solid legal documents. That way, if you do get notice of a lawsuit filed against you, you can quickly diffuse the situation by showing that you followed all the correct procedures and by having concise records of all the important data on your property and your tenants.


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About the Author

About the Author: Dulcey is both a private landlord and media contributor for Rentec Direct. Her passion is to bring up to date, useful information front-and-center for property managers and landlords. .


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