Landlord questions

For you guys that have rental properties, I like to pick your brain. What do you consider fair practices and what do you have included in your lease contract. Have any of you has any experience with Section 8 tenant? pros and cons of these tenants? I am going to rent my house out, I put an ad on craigslist and have gotten a dozen inquiries in 2 days. Any advise for a newbie in this renting business would be greatly appreciated.

Re: Landlord questions

Here's a link gf. Only downside I can see is the amount that you are allowed to charge.

http://www.landlordassociation.org/section8.html

Re: Landlord questions

... meet with the prospective tenants, check thier references on rental payment history, get a months deposit, include the water as part of rent, offer a $25-50 discount if they pay the rent early.

Re: Landlord questions

Actually, when you rent section 8, you rent to HUD, not the tennant. you have to meet HUDS standards, and be inspected every year, if the tenant ruins the carpet, HUD, will want it replaced, at your expense.

you do not get a lot of choice in choosing tenants, HUD does the financial qualifying.

if you if you have a problem with the tenant, you have to go thru HUD>

Re: Landlord questions

I don't have any rentals but have a friend who does. Part of his approval criteria is a credit report.
Good Luck!

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I use Remax, they handle everything for a percentage, The leasing document i provide is a standard Apartment / Condo lease which was modified to comply with the HOA, i have had the same tenant for 2 1/2 years with no problems.
I have no experience with renting to HUD.

Re: Landlord questions

My parents rent duplexes and we both know our fair share of landlords and the concencus is... never rent to section 8.

EDIT: stereotyping and bashing are not allowed here, lowkee. JB

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Alot of legal and paperwork issues with section 8 housing. Do your homework before going that route.

About 10 years ago I was relocated for 2 years and knowing nothing about anything at that time, I hired an agent to take care of renting my house. The agent took care of paperwork, finding and screening tenants, getting a lead based paint test done (house was built in '55 and required by MD law), and also provided me with information when maintenance issues came up. The hot water heater went out, some other issues. Now, you pay for that kind of service. First month's rent + 10% monthly was his asking price, we negotiated that down.

If I had to do it now, I wouldn't go that route, but as I said, I knew nothing at the time (maybe still don't), and I have a real estate license, so I would feel comfortable doing it myself. There are about 1000 books out there and a million websites with info and documents available.

Some key points:

Make sure you are familiar with all state laws for renting: Do you need a lead paint test, etc. ? Many variables.

Know your equal housing rules. Don't get sued.

Require a credit check for any potential renter, they can pay for it and you can deduct it off the first months rent.

Get a security deposit, and spell out what it takes to get it back.

Take "Before pictures" of the house, inside and out. Compare to when they move out.

Advise the renter to have renters insurance. They don't have to, but if something goes wrong, like a flooded basement, you are gonna fix the carpet, walls, etc, but you are not responsible for their stuff. They need to know that.

If you are gonna do this yourself, interview and feel comfortable with your tenant (a gimme I know). If an agent is doing it, he/she will provide an opinion you will have to trust.

If you use an agent, negotiate terms. This will be your business partner, in essence. Be comfortable with them.

Keep every sliver of paperwork, receipts etc. Everything you do to the house to get it rented, and while you are renting, is a tax deduction. If using a realtor, make sure they provide quarterly statements.

I'm missing alot of stuff I'm sure, but that's my .02. Good luck

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I might suggest you contact the Indiana state attorney general's office and ask if they have a booklet or brochure similar to the "Landlord and Tenants: Rights and Responsibilities" booklet they have here in Minnesota. It is a wealth of information.

Also, as others have suggested, I strongly suggest you find an application form you can copy, and charge each prospective tenant a non-refundable $50 application fee up front. You can find various companies that will do a credit search on the web. You should also do a criminal background check. I'd recommend the prospective tenant fill out and sign a "General Consent Form" that asks for SSN and DL numbers, current and previous addresses, birth date and phone number. Be sure to actually look at their vehicle and double-check the make, model and license plate against what they put on their application. Ask to see proof of auto insurance.

My mother moved into assisted living and asked that I rent out her condo. I only asked for one month's rent for the security deposit, but if it were a single-family home I would ask for two month's rent.

In Minnesota I was able to download lease and lease addendum forms for a small fee from the Minnesota Multi-Housing Assocation. Perhaps there is something similar in Indiana. I added a non-smoking addendum. I also added a clause in the lease under the "Miscellaneous" section that said when moving out the resident was responsible for removing all items from the property that they brought in, and that any costs to dispose of anything left behind would be deducted from the security deposit.

Be sure to include in the lease the names and birth dates of all occupants who will be living there.

And, yes, if the home was built before 1978 you will need to provide a lead-based paint disclosure (Title X U. S. C. 1018 ["Residential Lead Based Paint Hazard Reduction Act of 1992"]). Call the EPA and request a copy of their booklet, "Protect Your Family from Lead in Your Home." I created a letter stating what the law required and had the tenant sign the letter saying she received the booklet and understood the risks of lead based paint.

Also, you should require your tenant to purchase renter's insurance within 30-days of occupancy or face a $100 fine. Make the requirement part of the lease agreement.

All of the above stipulations were provided in the ad I put on Craigslist. Everyone who called knew beforehand, therefore, what the requirements were to rent the property. No surprises.

Finally, on the day before occupancy I took lots and lots of pictures of the property with the front page of that day's newspaper included in each photo. Highly recommend you do the same.

And then put everything in a tidy 3-ring binder.

Hope this helps, and best wishes in your rental endeavor.

Re: Landlord questions

Wow! Thanks guys. I'm definetely not going the Section 8 route. The reason that I asked because a young couple showed up at my house, took a tour, asked me if I would accept Section 8 and practically begged me to rent it to them. So would $50 cover the credit report and background check fees? What info I need from them to obtain reports? Is it too much to ask for first and last month rent, plus security deposit equal to one month rent up front at the time of lease signing?

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My parents ask for 1st, last + sec and have a more difficult time finding renters, but they do find them. Not many people (that don't own a house) have that kind of cash laying around, but they exist.

Search the net for 'rental documents' and you will find a credit app and needed info for them. The state laws vary a LOT, so read up carefully. Good luck!

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1st and last and credit check, bare minimum. It's harder to get them out than get them in !!!!
I am only speaking from Canadian experience though. May be totally different where you are.

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GoneFishie, there's some good stuff here:
http://www.in.gov/legislative/ic/code/title32/ar31/

Found it on Indiana Secretary of State website.

Re: Landlord questions

my mom runs an apt complex. I would avoid HUD like the plague if you can.