How to HandleTenants and the Paperwork
The proper handling of tenants and the right communication as a property owner is vital to creating a real estate investment portfolio. Without satisfied tenants you can't grow your portfolio and that is why many people don't own rental property. The most important part of this process is the paperwork, which has to be fair to both parties - owner and tenant. It also has to be legal and non-discriminatory, according to the law where the property is located. If you own a few properties, or plan to, you probably are aware that each new tenant comes with their own unique needs and issues. Handling each tenant the right way requires lots of time and energy, but it is definitely worth it. The property owner has to adapt to each individual if he/she wants to be successful in this undertaking. Meeting everyone's wants seems impossible, but there are a few steps towards that. First of all, every new tenant has to fill out an application form. This is a very important initial step, allowing you to find out as much as possible about the people who will be living in your property. The information the tenant submits has to be as detailed as possible - employer's name and contact details, social security number, income (proof of tax returns), previous landlord (if they have one) and emergency contact names and details. Many tenants cause damage, try to skip paying rent, invite other people to live with them and so on. Make sure you have their credit report and check their criminal background. You have all the rights to reject a potential tenant, based on their income, bad recommendation from previous employer or unsuitable lifestyle. After you have done all this, it's time to deal with the other part of paperwork, the so called agreement. This is a contract in all its legal power, so state the obligations and rights as clearly and precisely as possible. Everything you want the tenant to do or not do should be put on paper. Everything you will do in order to maintain the good condition of the property - regular inspections, repairs and other care, should be also written down. Both parties should be aware of what they are signing, without any hidden clauses or charges. Being honest and open is the only true way to handle the paperwork and secure that the tenant will be pleased. Each satisfied tenant means a good recommendation, which attracts more tenants and therefore your business is growing. If you want to earn a serious amount through real estate investment, be a landlord your tenants respect, someone they can always turn to in need. Another tip to follow which the best landlords are aware of is never to discriminate. There comes a time when a tenant will try to persuade you to make an exception for them. Whether it will be to paint the walls an unusual color or to let them have a dog, it is a must not to agree to any terms which are not stated in the initial agreement. If you do that for one tenant or family, this means you are changing the terms for everyone. Breaking the rules for one is considered discrimination. Keep your reputation intact and be fair to everyone. There are cases when tenants go to court because of such issues. Another common problem is when you file for eviction. If it's stated in the contract that, for instance, 15 days after rent is due, the tenant should leave the property, then this clause has to be equal for everyone. Having tenants means you need good paperwork, with crystal clear wording, so that everyone understands their obligations.