Having a good checklist is key to being prepared for all the ins and outs that come with being a landlord. Being a landlord is an ever evolving process with new laws always being put into place, court cases setting precedents, and new experiences to deal with. It makes being a landlord interesting and exciting sometimes but sometimes it can be very challenging as well. The checklist I created is one that I’ve been using since my first rental property over 10 years ago. The list has been added to over time as I learn how to be a better landlord through practice.
Lease Agreement: Having a “bullet proof” lease agreement is one the most important documents that you need to have in place with all of your tenants. Make sure they understand and read the document or you can at least highlight the most important points to them personally. A strong lease will promote a good long lasting tenant=landlord relationship. One in which your tenants treat your property with care. As I’ve said before and I’ll say it again, this is a document that is worth paying a lawyer to review to make sure that you are abiding by all of the local laws.
Rental Application: The rental application is where you will gather all of the information on the prospective tenant that you will need to facilitate your decision making process. The application should have a section for employment, past residences with contact info for the previous landlords, the number of adults and children along with there age that will be residing on the property, pets (if applicable), and personal information for everyone over eighteen. Personal information should include; legal name and aliases, social security number, contact information, drivers license number, and date of birth. You will also need there signature consenting to a credit and criminal background check.
Rental Criteria: Having a set list of rental criteria is key to good decision making. Items that could be included in the criteria are; credit score, income, employment history, evictions, criminal convictions, pets , references, etc. Between the application and tenant screening reports you should be able to determine if the applicant is qualified and meets your criteria. Do your due diligence and check out your prospective tenants each and every time, don’t depend solely on your gut instinct or make exceptions to the criteria.
Tenant Screening: It is important that you have an account setup with a reputable tenant screening company. I use Rentec Direct because they are affordable, easy to use, and the customer service is exceptional. If you wait until you have an applicant to setup an account with a tenant screening service you are wasting precious time. There are some fairly new regulations that require a site inspection at your office to verify that you’re equipped to properly store and dispose of sensitive data and records.
Separate Bank Account: Having a separate account to manage your rental properties is not only smart for tax purposes it’s also smart from a legal stand point. In the case of a lawsuit from a tenant it is much cleaner if your personal finances are not jumbled in with your rental income and expenses. This is not to say that a tenant can’t sue you personally but it does keep it separate If you have an LLC with your properties named or have an umbrella insurance policy this provides some protection from being personally responsible.
Business Phone Line: If you are hesitant to give out your personal phone number to your tenants it is probably best to have a business phone line. You’re probably thinking geez, that’s a big expense if you only have a few properties but there are call forwarding services that can be used for as little as $3 a month. Skype and Google Voice are two companies that will forward calls to your regular phone and save you from getting a completely separate line.
Post Office Box: This is a non-negotiable as far as I’m concerned, I do not want my tenants to know where I live. It’s so easy to stop by the post office and get a PO Box setup where your tenants can send there rent checks or other correspondence.
If you have any other items that you have on your checklist please share them, I’m always learning new things as a landlord and prefer to learn them in this scenario rather then a not so ideal situation.