One of the worst things a landlord could ever experience in the rental housing business is getting sued by his tenants. Not only will he suffer legal consequences, but he can also lose his business completely.
Knowing these common legal mistakes landlords commit can help you avoid committing the same mistakes in your career as a landlord.
Discriminating tenants
One of the worst things a landlord, property manager, or rental agent can do is to discriminate tenants.
The most common instances of tenant discrimination are during the screening of rental applicants.
According to the Fair Housing Act (FHA), every individual cannot be denied to own or rent a home based on discriminatory reasons such as gender, age, race, religion, color, national origin, disability, and familial status. Some states even include political affiliation and personal appearance to the list.
Landlords must not ask potential tenants discriminatory questions during the tenant-screening process, advertise their properties that exclude a certain group of individuals in the market, or treat specific tenants unfairly.
Before you create a listing on Padleads and syndicate it to popular rental websites, make sure that you are prepared to be non-discriminatory to hopeful home hunters who will apply to rent your place. Also make sure that your listing doesn’t contain details that suggest discriminatory intent.
Illegal terms in the lease agreement
Make sure that all the provisions stipulated on your lease agreement do not, in any way, violate state and federal laws. You should have a lawyer go through your lease agreement to detect common mistakes such as:
- Discriminatory terms
- Requiring a tenant to waive his rights to file a lawsuit against the landlord
- Obliging a renter to waive his rights to a security deposit refund. Mishandling security deposits and deductions is also a common ground for tenants to sue.
Non-disclosure of standard property information
A tenant who is about to move into your rental property must be aware of standard disclosures (based on your state laws). In most cases, you have to inform the tenant about:
- Existence of mold
- Recent deaths that transpired in the rental home
- Sex offenders that reside within the area
- Data from the state’s sexual offender registry
- If the rental unit was coated with lead-based paint (but only for properties that were built before 1978)
Failing to Eliminate Safety Hazards
Tenant injury lawsuits can lead to serious financial losses for every landlord. Make sure to conduct scheduled inspections to check for any safety hazards, fire hazards, and poor security. This includes checking the physical condition of the property as well as making sure that security measures are in place so that illegal intruders cannot enter the premises.
You also have to inform tenants after you learn of any criminal activity or the presence of someone who intends to commit illegal acts within the property.
Failure to Perform Repairs
Although this is a simple concept, it still gets repeatedly violated by some landlords. You must provide your tenants with a habitable place to live in. If there are damages in the property that causes an inconvenience to your tenant’s daily lives, then you have to get it fixed in the shortest time possible.
Non-compliance of standard legal protocols
State and federal housing laws have set rules on how to legally conduct evictions, inspections, tenant screenings, rent increase, etc. Basic rules such as giving proper notice and executing the process without committing discrimination or harassment towards a tenant must be observed.
Reviewing both early and recent housing laws and getting legal advice from legal counsel must be done by you to avoid committing violations that would get you in trouble with the law.