Landlord-tenant laws have been established at federal, state, and local levels to protect both parties during the rental process. They are essential if landlords want to run a safe, profitable business with minimized risks. For tenants, these laws ensure their basic rights such as their right to privacy and the right to a safe environment are protected.
It is very important to become familiar with landlord-tenant laws specific to your state and city. Ignorance of the laws is no excuse and you can be sued for not obeying state laws, even if you were unaware of their existence.
The U.S. Department of Housing and Urban Development (HUD) is responsible for regulations covering discrimination and other federal issues affecting your tenants. You can also check with your state real estate board or join a local professional agency for property managers or landlords who should be able to guide state regulations.
There are a couple of major federal laws that all landlords and property managers should be familiar with. These include the Fair Housing Act and the Federal Credit Reporting Act.
The Fair Housing Act prohibits discrimination on the following factors: race, color, national origin, religion, sex familial status, or disability. The Fair Housing Act extends beyond the actual lease process and also prevents landlords from marketing their properties to certain groups of people.
The Fair Credit Reporting Act dictates how a landlord may use a tenant’s credit history for screening purposes. Under this act, a landlord must get an applicant’s permission to run a credit report, provide information on the credit reporting agency used, and inform the applicant if the information contained on the credit report was the basis for denial or adverse action.
Generally speaking the laws at a state level concern practical matters. For example, the rights and responsibilities of tenants and landlords, what terms and conditions should be or are allowed to be set out in the lease, and how evictions should be handled.
State laws might also specify rules around accepting and handling deposits. For example, in some states, there are limits on the maximum amount of a deposit as well as laws outlining things like whether they can be commingled with other funds and the process for using deposit funds.
Whether you are advertising your property, screening new tenants, or setting apartment rules, make sure that you are in compliance with Fair Housing laws and that all actions or policies apply to everyone (with supporting documentation), and cannot be construed as affecting some people but not others.
The Fair Housing Act prohibits you from discriminating against applicants or residents based on any of the seven protected classes:
The Fair Housing Act establishes only the minimum protections. States and localities may set additional protected classes, such as the source of income — whether a person’s income is from a job, alimony, child support, unemployment, welfare, disability payments, and so on.
Providing a legally binding lease agreement and other paperwork (such as notices) is a key responsibility. The lease agreement especially is important if you want to enforce any of the terms of the renal. These documents must abide by local and federal laws. Leasing periods, monthly rental rates, and tenant names must be clearly indicated.
The lease should contain all the central and important information regarding the tenancy including, the property address, the move-in date, the tenancy length, the deposit amount, the rent amount, due date, and frequency. Other things you can include are how you want the tenant to pay rent, how they should contact you in case of emergency, and how they should put in any maintenance requests.
In some jurisdictions, legal disclosures, such as security deposit details, must be included. The lease should also contain all appropriate clauses, such as advising tenants to purchase renters’ insurance, what maintenance the tenant is responsible for, your pet policy, your smoking policy, and late fees, and your grace period.
Without a legally binding lease document, there is no evidence that either party has agreed to any of the rules of the tenancy. As such, should a tenant not pay the expected rent or damage the property it will be incredibly hard to evict them.
You can create your own customized lease using a lawyer or an online legal documents service such as Rocket Lawyer, or you can use a lease template document.
In addition to federal disclosures such as lead-based paint disclosure, several states require landlords to disclose information about some or all of the following:
The implied warranty of habitability requires that landlords provide residents with living space that’s fit for human occupancy. This means that the rental unit must be in a safe and habitable condition. It must be structurally sound, supplied properly with plumbing, electricity, and heating, and be free of debris, filth, garbage, rodents, and pests.Additionally, in some jurisdictions, landlords must provide specific safety measures. These may include fire and carbon monoxide detectors, fire extinguishers, front door peepholes, deadbolt locks on exterior doors, and window locks.If your property is deemed to be unfit for habitation you could be liable to a lawsuit and any tenants may be within their rights to break with the lease contract and either withhold rent until such a time as the property is made habitable or move on to another property.
Throughout the tenancy, the property must be maintained properly to ensure it remains habitable.
Tenants are responsible for general maintenance like cleaning, disposing of waste, and removal of mold due to dampness (though not mold caused by structural issues). Additionally, they are responsible for reporting any repairs that need doing as outlined in the lease agreement. Landlords are responsible for responding whenever a maintenance issue is reported and organizing the repair work to be done in a timely fashion.
If a rental unit is uninhabitable, residents, as we mentioned above, have the right to withhold rent until the necessary repairs are made or, in more serious situations, terminate the lease.
It is standard practice for the lease to specify a security deposit amount to be collected before the tenancy begins to cover any potential damages or lost rent. The security deposit
Every state has a security deposit statute that typically specifies the following:
This varies broadly and can range from as little as equal to 1 month’s rent to have no limit at all. When setting the security deposit you should consider both your tenants’ ability to pay the deposit as well as whether that deposit amount is sufficient assurance to protect you from potential damages.
Usually, landlords are required to keep deposits entirely separate from any other funds. In some jurisdictions, you are obliged to keep it in an interest-bearing account in a separate interest-bearing account.
Security deposits are an assurance, a guarantee that the property will be looked after by the tenant during the tenancy. Should the tenant not look after the property, however, landlords may be entitled to deduct from the deposit any unpaid rent and damages that are deemed to be beyond standard wear and tear.
While it differs from state to state, generally the deposit is required to be returned to the tenant within 30 or 60 days after the tenancy ends.
In many states(though not all), landlords are required to supply an itemized invoice for all deductions taken from the deposit. Some states also specify how you should record the evidence of the deductions.
Tenants have the right to enjoy living in their rental property without disturbances. This essentially means two things for landlords.
First, landlords are not allowed to enter a resident’s unit whenever they want. Rather they have the right to enter in an emergency (eg. the apartment is on fire), after having been permitted by the tenant (eg. to do a requested repair), or when doing routine inspections or showing the property.
Apart from in the case of an emergency, landlords must give adequate notice. This normally requires the landlord to give written notice to the tenant at least 24 hours before entry.
Secondly, landlords have to take action to investigate complaints if other residents or neighbors are causing a disturbance, and when reasonable take action.
When a tenant moves out, either voluntarily or after eviction landlords often find themselves not only with a cleanup job but also a clearing out the job of any personal property left behind. Usually, this is just trash or junk that the tenant doesn’t want, for example, old food, cleaning supplies, etc. Landlords are free to dispose of items like this. However, more valuable items need to be treated differently.
Landlords need to be aware of their state-specific laws when it comes to disposing of personal property left behind by tenants, especially property with value, for example, clothes, furniture (that’s in good condition), electronic equipment, etc. In some states, landlords can face serious penalties and liability when they dispose of a tenant’s abandoned personal property (other than obvious trash) without first following certain procedures.
While the specifics of the rules vary depending on your jurisdiction the general rules remain the same. If a tenant leaves items behind after they move out the landlord must treat the item as abandoned property, which means they have to go through the following process. First, notify the tenant of how they can claim the property, inform them of the storage costs if storage costs are applicable, and specify how long they have to claim the property. Often states will specify how long you have to hold it before selling or discarding it.
If the property remains unclaimed and is above a certain value the landlord may sell it through a public sale. If it is worth less than the value as specified by the state the landlord can either keep it or throw it away.
If you become aware of criminal activity going on in one of your rentals, for example, selling or growing drugs, you must immediately report it to the authorities. Not doing so could have serious legal and financial ramifications or even result in having your property seized.
Landlords, as the property owner, are responsible for protecting the neighborhood, and could still get in trouble should this activity go on in your property without your knowledge. This is one very good reason to have frequent property inspections.
Evictions are unfortunately sometimes necessary. Every state has specific laws that regulate the eviction proceedings, but there are a few standard rules. In general, a landlord can evict a tenant for the following reasons: non-payment of rent, failure to vacate after the lease agreement expires, violation of provisions in the lease contract, the damage is caused to the property resulting in a significant decrease in the properties value.
Before beginning the eviction process most states require the landlord to give the tenant a notice which generally allows time for the tenant to rectify the situation or to vacate the property voluntarily before a lawsuit is filed.
If a landlord does still need to go through eviction proceedings after the notice is given they cannot turn off essential utilities like electricity, water, or gas, nor can they attempt to physically remove them themselves. Instead, they must follow the legal proceedings to the letter. Failing to do so could result in the eviction ruling going against the landlord and the landlord not being able to remove the tenants, potentially for months, even though they aren’t paying rent.
Landlord-tenant laws vary widely from state to state and sometimes even from city to city. On top of this, they often change. Because of this it is recommended to revisit and update your lease routinely and to seek legal counsel from a licensed professional to ensure you stay on the right side of the law throughout the tenancy period.
Keeping accurate records is an essential part of staying in compliance with the law. Landlord Studio allows you to store and organize all the relevant documentation, files, and data securely in our cloud server. This means it’s easily accessible for future reference. Add notes, upload documents, and digitize receipts to be accessed whenever you need them from any device.
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Ben is an author and real estate enthusiast. His interest in all things entrepreneurial has led him to work with real estate professionals all over the world, distilling their knowledge into articles and Ebooks.
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