By: Claire Edicson
Are you thinking about becoming a landlord? If you are, then there are a few different things that you should know about what it takes. Despite what people seem to think, it’s not actually as easy as purchasing a property and then just letting someone live there. There is far more to it than this, and it’s imperative that you know the ins and outs before you make a decision because once you’ve signed the contract, there is no going back, at least for the duration of that tenancy.
So, if you want to take on this kind of responsibility for the sake of a more stable side income, then you need to know what you are getting into. In this article, we’re going to be discussing exactly that, so if you would like to find out more, feel free to read on.
You Need Insurance
The first thing that we’re going to mention here is that you need landlord insurance if you want to become one. This is the same for any business owner, and while this isn’t technically a business, it’s an investment that you need to protect. This kind of insurance helps to protect a landlord from any financial losses associated with renting out your property.
Of course, to get the ins and outs of the insurance you need to look into the individual policies as they are all slightly different. Generally though, this insurance policy will cover the building itself, and you should have the option to insure any of the contents of the property that belong to you. This should give you the peace of mind that you need that you are not going to lose out massively if you get it wrong with the tenant that you choose.
You need to have the insurance running before anyone can move into your property. The reason for this is that you do not want to risk anything happening before your policy kicks in, because that would leave you in a bit of a pickle.
Be Careful Who You Rent To
We want to add in here that you should be careful who you rent to. Some people seem to think that anyone is a good choice, but this isn’t the case. In fact, while it might seem like a good idea to just rent to the first person you come across who shows an interest as this makes it faster, this is not true. You could find that if you’re not careful, you end up renting to someone who doesn’t pay their rent on time, has a history of doing this, or someone who can’t actually afford to pay you the rent you asked for.
It’s a good idea then to go through a tenant screening process, finding as much information as you can about them pertaining to them renting your property. You want to know how much they make so that you can see if the property is even affordable to them, and ideally you want to run a soft credit check as well. It’s a good idea to use one of the apps out there that uses information input to determine whether someone is a high or low risk tenant.
Ideally, you also want to ask for a reference or two if they have rented in the past. This just gives you an extra bit of peace of mind as you will be able to get information from their previous landlords about what they are like.
Realtor Or Go It Alone?
When it comes time for you to rent out your property, are you going to use a realtor or are you going to go it alone? Some people find that they don’t want to partner with a realtor because it makes the process more difficult, but that doesn’t mean that it’s not the right thing to do. At least if you do partner with one of these professionals, you know for sure that you are getting professional help in renting out your property. They will handle all of the credit checks, the viewings and the legal side for you, taking a whole load off of your plate.
However, it also makes the process longer, and it can put people off renting from you as there are so many hoops to jump through. Sometimes, going it on your own is the easier option, even though it means you have to do all of the work yourself. You can look online and find a free rental agreement which you can print out to be your tenancy contracts. You can then add in or get rid of any bits that you feel necessary. Remember though that once it has been signed by both parties the contract is legally binding, so ensure that you are happy with the content.
What Are You Responsible For
The final thing that we want to mention here is that you need to know what your responsibilities are as a landlord. What are you responsible for fixing if things go wrong and what are the tenants responsible for? What are your rights? How can you make sure the property is being looked after? It’s questions like this that you need to ask so that you fully understand what is going to be expected of you. There’s nothing worse than being blindsided by information that you didn’t have previously, especially if it would have changed your mind.
It might even be worth consulting with a legal professional to get a solid idea of your responsibilities. It can be tricky to work it out based on the information you find online, so your best bet is to consult someone who knows for sure.
We hope that you have found this article helpful, and now see what you need to know if you are thinking about becoming a landlord. It’s not always easy to do this, but the more you know, the more secure you can feel in your decision. At the end of the day, if it’s done right, it’s a fantastic source of income for you!
About the Author: Claire is a technology journalist with extensive experience covering emerging tech trends, AI developments, and the evolving digital landscape. Her experience helps readers understand complex technological advancements, and how they can be implemented in their everyday lives.
