Owning real property and renting it to third parties can be a very good investment. However, before ever signing that first lease, it is important to be familiar with the landlord-tenant laws in the state where the property is located.
Below is a list of the most common mistakes landlords make. Most of these can be avoided simply by being familiar with your state’s landlord-tenant laws, while others require the investment of an attorney’s services to review the legal documents and processes you intend on using before you begin.
Below are the ten most common errors made by landlords, based on Ohio law:
1. Getting a lease off the internet
Internet leases do not include state-specific clauses, and landlord-tenant laws vary considerably from state to state.
Penalties for violating landlord-tenant laws can be quite hefty and include the award of attorney’s fees to the tenant.
2. Not screening applicants
Credit and background checks provide a snapshot of a prospective tenant’s background and financial situation.
Calling and questioning a prior landlord can yield priceless information.
3. Using self-help
Entering without the tenant’s permission and/or evicting a tenant without a court order are violations of Ohio law.
Depending on the action taken, a landlord can find himself facing criminal charges.
4. Entering without notice
Doing so is a statutory violation and intrudes on the tenant’s right to quiet enjoyment of the property.
Repeated violations can give the tenant the right to terminate the lease.
5. Security deposit
Most state laws require a landlord to return a security deposit within a certain number of days, along with an itemization of any deductions.
This statutory violation can result in an award to the tenant of double the amount of the deposit wrongfully withheld, as well as an award of attorney’s fees.
6. Ohio Revised Code
It is essential to be familiar with the laws of the state of where the property is located and their application beforebecoming a real estate investor.
7. Move-in / Move-out checklist
These checklists are extremely beneficial in the event of disputes about the condition of the property, which often arise at the end of a lease.
If the checklist is signed by the tenant, while not incontrovertible proof of the condition of the property at the commencement of the lease, it is certainly useful for a landlord in the event of dispute.
8. Checking tenant identification
Identity theft is a serious problem.
Always obtain photo identification of prospective tenants and keep a copy. Most mobile phones now have excellent cameras.
Make sure the photo and information on the identification match the applicant.
9. Waiving a lease violation
Waiving late fees or other lease terms is often done to accommodate a tenant.
In order to make sure that doing so does not result in a permanent waiver of the term being waived, all waivers should be accompanied by a letter stating that the accommodation is a one-time event.
10. Being nice
Being a landlord is a business. You can be polite without being overly friendly. You are not and should not be your tenant’s friend and always maintain a business relationship.