Saturday, April 26, 2008


Tips for Successful and Legal Landlording

The national association of Realtors just came out with a list of 7 sercrets to successful and legal landlording. #1 is my favorite: Run Renting Like a Business. This is so important whether you are renting your condo to your friend or a 15 unit building professionally. Make sure there are rules and policys that are clear and in writing. This will help you avoid misunderstanding and confusion if and when things go wrong. Even friends and family with the best intentions can fall on hard times. If they can't pay their rent you are going to have problems and fights no matter what, but if you have some rules and policys it will help you out of a hard situation gracefully. Remember if you are ever in a dispute with a tenant (no matter who they are) you should make sure all of your correspondence is in writing.
The other 6 tips are:
#2 Treat everyone equally, espcially important when if comes to fair housing laws.
#3 Use the right forms, Chicago has pre-printed lease that are easy to get.
#4 Make your lease as specific as possible, all of my leases have a ride with specific rules for my properites.
#5 Write out a policy for defaults, you have to have written rules about when rent is due, what the late fee is, and when you will began eviction. Remember in Chicago rent is late after the 5th or later, and you can only charge a certain amount in late fees ($10 for the first $500 in rent and 5% of anything over that).
#6 Don't treat secuirty deposits as potentail for profit, this is important you must keep security deposit money in a separete account. Security deposits can be applied to un-paid rent but only after the lease has expired or the tenant moves out, not before.
#7 Don't be fooled by appearances, always check out tenants carefully. Con artist are succesfull because they are good at it, don't be fooled by good looks and charm. Make sure to check out employment and past references. Run their credit is you can, you can also charge your prospective tenant a fee for the credit check.

Make sure to follow your own rules too.

April 2008 Realtor Magazine

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