Rental Properties: It’s Not As Bad an Idea As You Thought
True wealth begins when your assets begin working for you; property ownership is one of many ways to start putting your assets to work. If you have done well enough to own multiple properties, you have likely considered renting those properties out to increase your residual income (or at least offset the cost of multiple mortgages by receiving rental income). Of course, many would-be landlords avoid renting their properties like the plague; this ill-advised avoidance is premised on severely flawed information – while liabilities do increase as a landlord, it’s hardly something that will bankrupt you. This article will briefly discuss some of the faultier myths about being a landlord, so you can sit back, relax, and watch your money roll in.
Many tenants are under the impression that the landlord must make all repairs; this is not really the case. Your repair obligations are covered by the terms of the lease (which is in turn governed by statute and general principles of contract interpretation), which means you can specify what repairs you are obligated to perform. As a general rule, you cannot alter your obligation to make repairs that have a bearing on whether or not the property is “habitable” (heating, for example, is something you will always be responsible for). More importantly, it is important to note that how something got damaged will also impact your duty to repair; if it was the tenant’s fault, it is the tenant’s obligation to make the repair (or at least pay for the repair).
While it is true that the Fair Employment and Housing Act prohibits renting to someone based on their criminal record, that doesn’t mean their criminal record is irrelevant to your determination. If the nature of the previous crime is such that you reasonably fear for the safety of your property or your other tenants, you are probably allowed to refuse to rent on that basis.
It’s reasonable to think that you will have to get a top-tiered attorney to draft a strong rental agreement before you begin renting out your property, but this is not the case. In many instances, template agreements are templates because they are functional for their purpose. While a little bit of elitism is completely normal, that does not mean that elitism is logical or correct. Take a look at form rental agreements, and then add terms with an attorney if you feel there is something that isn’t sufficiently covered (chances are everything is sufficiently covered though, because it wouldn’t be much of a template/form if he had gaping holes).
At the Chernov Team, we understand that knowledge is power, particularly when it comes to turning an asset into an income-bearing item. At the Chernov Team we know that whoever comes to the table most prepared leaves with the most, and the Chernov Team always eaves the table with the most.