6 Mistakes That Landlords Should Avoid

Cameron Cowan | Knowledge Steward

Rental housing has a variety of pitfalls. One false move and a simple mistake could adversely affect your property investment business. We’ve identified 6 areas where all landlords should take special care to get the process right, comply with the law, and make sure that your protecting your investment.

Insufficient Tenant Screening

Failing to screen applicants adequately. RHA recommends as a best practice that landlords run a credit, criminal and civil background check on all applicants signing the lease. Criminal and civil background checks should be run on any other occupants living at the property but not signing the lease. Spending time reviewing and checking the information a tenant provides you is not only time well spent but will also save you money in the long run. Renting to an applicant based on your emotional reaction can lead to a fair housing lawsuit.

Not Enforcing the Rules

Allowing a tenant to break a rule of the lease. If you allow a tenant to break one rule, chances are they will try to break another one as well. Items such as unauthorized occupants, pets being noisy, and keeping the yards clean are important. The tenant agreed to the rules at the beginning of the lease, enforce them. Rules are there to ensure your asset is being taken care of properly.

Taking a Deposit Too Soon

Taking a security deposit without obeying the law. You cannot accept a security deposit without a signed property condition checklist. Have the tenant look through the unit and note deficiencies before you sign the lease. This way if you don’t agree, you aren’t already bound by an agreement to rent to the person. There are other laws regarding the security deposit as well such as providing a receipt and providing the tenant of which bank the monies are held at and after tenancy sending a statement of deposit refund. RHA has an online class if you need more detail.

Not Using the RHAWA Lease

This is a huge mistake. As a member of RHAWA, you have access to lawyer prepared, Washington specific leases. Some people end up using a generic lease purchased at an office supply store or a lease borrowed from an aunt, uncle, or friend. While they had the best intentions, you need a lease that is state-specific and current with changes in the law. Not having the right clauses in your lease could cost you money. Also, while you can write anything you want into a lease, that doesn’t mean those clauses will all be legal.

Not Inspecting the Property

A landlord’s responsibility is to provide a rental unit that is fit to live in. Many times a landlord will need to make some repairs on a unit during tenancy. Many of these may be preventive maintenance. Addressing potential maintenance issues will save you money and time in the future. An annual inspection will help you keep the unit maintained and has the additional benefit of allowing you to see how the tenant takes care of the unit.

Not Returning the Deposit on Time

RCW 59.18.280 states that within 21 days after the termination of the rental agreement of the premises, or if the tenant abandons the premises as defined in RCW 59.18.310, the landlord shall give a full and specific statement of the basis for retaining any of the deposit together with the payment of any refund due the tenant under the terms and conditions of the rental agreement. The notice shall be delivered to the tenant personally or by mail to his or her last known address. If the landlord fails to give such statement together with any refund due the tenant within the time limits specified above he or she shall be liable to the tenant for the full amount of the deposit. Landlords must also take note of their lease, however, as the 21 day timeline was a change in law effective July 2016. Leases signed prior to then which state the landlord has 14 days follow the 14 day period, and do not enjoy the benefit of the new 21 day law.

These may seem like simple things but one false mistake can have unfortunate consequences. It’s important to stay on the right side of the law to make sure that if you have to go to court with a tenant or have any other legal problems, you are covered and protected.