When it comes to your rental property, safeguarding your investment should be a primary concern. The most effective approach to achieving this is by establishing clear rules for your tenants. These rules, which will be legally binding, should be explicitly outlined in the lease agreement. By signing the lease agreement, applicants agree to abide by these house rules throughout their tenancy. To assist you, we have provided a list of eight commonly utilized house rules that can be incorporated into your lease agreement.
1. Timely Rent Payments and Late Fees
When searching for tenants as a landlord, prioritize those who demonstrate timely rent payments, responsibility for maintaining the rental property, and follow the lease terms. Emphasize the significance of paying rent promptly by implementing it as a mandatory rule for tenants. A comprehensive lease agreement should define rent due dates, grace period duration (if applicable), the final day to pay rent without incurring late fees, and the corresponding late fee amount. By establishing this house rule, you can ensure monthly, consistent on-time rent payments.
2. Maintenance, Repairs, and Cleanliness
Because you hope your tenant(s) will keep the property in good condition, covering maintenance, repairs, and cleanliness in the lease is essential. Can tenants make repairs themselves? What maintenance issues should they contact you for? What's considered emergency maintenance? How often must you enter the property for routine inspections and repairs? These questions and more should be answered in the lease so the tenant knows how to handle maintenance issues. If you expect the property to be thoroughly cleaned and maintained throughout the lease period, state your expectations for cleanliness as well.
3. Renters Insurance
When it comes to renters' insurance, while it may not be required by law in certain states, you should consider including it in your lease agreement. Requiring renters' insurance offers several advantages for you as the landlord, such as reducing your liabilities, mitigating risks of damage or injuries caused by pets, and reducing costs if you cause damage to the rental. It's important to discuss with your attorney the possibility of adding a mandatory renters insurance policy to your lease, determining the appropriate coverage amount, or requiring your renter to present their own renter's insurance policy before they sign the lease.
4. Pet Policies
Whether you allow pets in your rental property or not, you will need to provide a pet policy in the lease. If you don't allow pets, clearly state that the rental has a no-pets policy and the fee or consequence (such as lease termination) for breaking this policy. If you allow pets but have specific regulations and breed restrictions, clearly state what is and is not allowed in your pet-friendly rental. For instance, you might allow up to three pets in the rental if the pets are of a particular type and size. Also include pet fees, monthly pet rent, and any other specifics regarding pets in this house rule. Remember that service animals and emotional support animals are protected under the FHA.
5. Quiet Hours
Including quiet hours in your lease is important for creating a harmonious living environment in a rental property that's close to neighbors or located in a multi-family building. This encourages respect among tenants and prevents excessive noise disturbances during specified hours, such as 10 pm to 8 am. Violations of this policy may include loud music or gatherings, which are prohibited during the designated quiet hours as stated in the lease agreement. By implementing this house rule, you can effectively manage and prevent noise-related issues with your tenants.
6. Lease Renewals and Notice Periods
As a landlord, it's standard practice to require proper notice from tenants for lease renewals and move-outs. To facilitate the lease renewal process, you are required to send a letter to the tenant outlining the terms of their lease renewal. The tenant will then inform you about their decision to renew or not renew their lease. In case of non-renewal, the tenant must provide you with a notice to vacate. The notice period for both cases can be either 30 or 60 days prior to the lease-end date. Although the choice of notice period is up to you, the recommendation is typically a 60-day notice period for long-term leases, and a 30-day notice period for short-term or month-to-month leases.
7. Damage Deductions from the Security Deposit
If you find damage to the property during the move-out inspection, you will need money to make the repairs. That money typically will come from the security deposit (depending on your state laws). If the cost of the damage exceeds the security deposit, you will need to request payment for damages through a demand letter. The lease clearly states that any damage to the property beyond normal wear and tear will be withheld from the security deposit. To better track your property's condition during the lease term, we suggest using a rental walk-through checklist for both the move-in and move-out inspections.
8. Consequences of Lease Breaking
If a tenant breaks the lease, there needs to be consequences. Breaking the lease can look different depending on the situation. For example, a tenant can break the lease by not paying rent for an extended period of time or by violating other policies in the lease agreement, such as having pets in a no-pets rental, damaging the rental beyond normal wear and tear, or repeatedly ignoring the lease-mandated quiet hours. If the tenant violates the terms of the lease in a serious manner, you may need to start the eviction process if all else fails.
Breaking the lease also refers to a tenant needing to end the lease early. If the tenant needs to terminate the lease before the set end date, you could require them to pay one- or two-months' rent for breaking the lease. Also, keep in mind that state laws vary on whether a tenant is responsible for paying rent for the remainder of the lease.
What to Do If a Tenant Violates the House Rules
Violating the house rules will differ in severity depending on the rule. For instance, if your tenant pays rent late one month, then the punishment will be adding a late fee to their rent payment. If they don't pay rent late again, everything should be fine.
If property damage occurs because a tenant has several pets in a no-pets rental, the repercussions may need to take a more serious turn. Violating the house rules you've set means that the tenant is violating the terms of their lease agreement, but again, each policy will be handled differently. Clearly state the consequences of violating each policy in the lease agreement so the tenant knows what to expect.
