If you own a summer house that you don't use from September through June, then you have a great way to make some extra income. However, before you go ahead and rent out your house, there are a few things you need to do. These precautions will make sure your house is protected and that you are safe from lawsuits and problem tenants. Here's what to do.
Hire A Tenant-Screening Service
You are going to be a landlord, which means you need to take the responsibility of screening tenants seriously. The process is very time consuming, and if you don't know how to do background checks, it will be a steep learning curve. The best way to handle this is to contact a tenant-screening service. They will make sure that the people who are looking to rent the house are not habitual deadbeats or criminals. You don't want to rent to someone who has been evicted from their last few residences. Also, you don't want someone who has a history of dealing drugs. They might create a disturbance in the community, which might cause you problems (especially if there is an HOA that has rules), and they might even commit crimes in your home, which could land you in court dealing with all the problems.
Speak With Your Homeowners Insurance Agent
Don't just assume that your current policy will protect you from lawsuits. Suppose a tenant falls down the stairs or slips outside when it's icy; you could be exposing yourself to a huge lawsuit. You want to avoid this at all costs. This means that you need to speak with your insurance agent and tell them exactly what you plan on doing.
Consider Hiring A Property Management Company
Unless you want to be a very hands-on landlord, you will need to hire a property management firm. They will deal with collecting rent, handling a leaky faucet, and even shoveling snow or mowing the lawn. Otherwise, you will have to manage the property yourself, which can be a huge time sink.
Speak With A Residential Real Estate Lawyer
You can find form lease agreements online, but it is best to have a lawyer draw up the forms for you. You don't want there to be any ambiguity about the duration of the stay, especially since you are only going to be renting out the house from September though June. Most importantly, you want to avoid the nightmare situation where tenants take you to court to contest the lease and refuse to leave the property. A real estate lawyer will know how to draw up a airtight rental agreement that will hold up in court.