December 23, 2011 Neil warshafsky

10 Tips – Renting to Tenants

1. Credit Check: Obtain a legal consent from the prospective tenant and run a credit check before you accept a tenant through an approved credit agency or through your bank.

2. Bank, Previous Landlord & Other References:  Obtain banking information and consent for a bank reference check from the prospective tenant and follow through with all reference checks. Check with previous landlords, and creditors that the prospective tenant may do business with.

3. Lease Document: It is best to engage a lawyer to prepare a lease form which contains specific provisions which relate to your property and the relationship that you are looking to establish with your tenant. It may seem expensive but it may be money well spent in the long run. Standard Lease forms may be cheap to acquire but very costly if key ingredients are missing that may be applicable to your situation will definitely be costly in the long run.

4. Illegal Apartments & Code Violations: Never rent out an illegally converted apartment. You will be exposed to many potential problems. If a tenant or guest of a tenant has an accident, you will have exposure. Legal collection of amounts due may be invalidated by a judge if it is determined that the unit is illegal. Ensure that you are up to current codes at all times, as non-compliance equals exposure to possible liability.

5. Residential Tenancies Act 2006: Become familiar with all legislation which will affect your property and relationship with your tenant. The Act addresses issues such as default provisions, how to terminate tenancies, violations and other matters which should be aware of.

6. Register Yourself as a Landlord: You should always register as a Landlord with the municipality and various governmental agencies which have local jurisdiction.  In the event a violation is issued or should a tenant or neighbour voice a complaint you would likely be contacted immediately and directly.  This may speed up the process and you may be given ample lead time in order to fix the problem and avoid unnecessary penalties and interest. Many municipalities have other requirements and failure to comply will likely result in steep fines.

7. Vacant Possession: If you are contemplating selling your house, remove your tenants before signing the contract of sale, as there is no assurance they will leave voluntarily which may delay your closing and cost you much more than previously anticipated.

8. Rules & Regulations: Having a comprehensive and current set of Rules and Regulations will make your building more desirable and will afford you more control over your property and the enforcement will be appreciated by your tenants. Items that are typically addressed within these rules would be parking, garbage and recycling matters, pest control, leaving goods outside units, bicycle storage, and other matters.

9. Type of Tenants: Make decisions regarding the profile of tenant that is suitable for your building. Singles, retirees, large families, pets, all affect the leas ability of your property and hence its value.

10. Record-Keeping: Maintain a good set of records which are clear and concise with proper back up. This applies to rental collections, invoices, payments. The records will be invaluable in the event your property and company may be subject to an audit, in the time of a sale and for other reasons.