Renting a property that you own to tenants can be a great way to generate passive income. This is true for both residential and commercial buildings. As a landlord, you should be aware of the rights that you have. This is because sometimes, landlord-tenant relationships can break down and tenants can occasionally fail to meet their obligations. If you don’t know your landlord rights, then you may not handle the situation in an ideal way.
Landlord rights can vary slightly from state to state. However, here are some of the top rights that most states have for landlords, and that you need to know if you will be renting property to tenants.
1. The Right to Enter the Property
There are a number of situations where it is perfectly legal for a landlord to enter the property of the tenant. However, advance warning may be required. The terms of the lease can dictate this. But, a landlord has the right to enter the property to inspect it, to make repairs, to check whether damages have taken place (which will void the security deposit), to show the apartment to prospective tenants, to follow a court order and for a number of other related reasons. So, if you are a landlord, and if you believe that you have a need to enter the property, then you should legally be able to as long as you adhere to the terms of your lease.
2. The Right to Increase the Rent Price
If you would like to increase the rent price for your property, then you can. However, you will have to wait until the current lease expires. Also, you must comply with any rent controls or other rent price restrictions that may exist in your area. Many places do not have such restrictions, however, and therefore allow landlords to increase rent prices to whatever they want. But, if you do raise the rent prices, it could potentially drive tenants away to cheaper alternatives. So, you will have to keep the principles of the free market in mind if you are planning to raise your rent prices.
3. The Right to Charge Late Fees
If the tenant pays the rent 30 days or more after it is due, then you, as a landlord, have the right to charge a late fee. This particular fee can be laid out in the terms of your lease with the tenant. You could run into problems if you try to charge the tenant late fees without specifying what these fees will be in the lease. So, you should always make sure that you specify exactly what the late fees are in the lease. As with rent increases, if you make late fees too high, it could drive renters away, so you should also be careful not to make these fees too high.
4. The Right to Terminate a Lease
Although this is something that you most likely do not want to have to do, you still have the right to do it if the tenant fails to meet their contractual obligations; for example, if a tenant fails to pay rent, if a tenant breaches other lease clauses such as having a pet in a no-pet apartment, if a tenant breaks the law by using illicit drugs in the apartment, etc. No matter how careful you are when you scan your tenants, there is still a good chance that you may have to terminate a lease at some point in time.
5. The Right to Prompt Payment
This essentially means that you can choose to make rent due on the first of the month if you would like. Of course, you don’t have to make it due on this day, but if you would like to, then you are legally entitled to do so.
Although tenants have many rights when renting property, landlords do too. It is very helpful to know these rights and prevent yourself from handling a situation improperly. The rights mentioned above are some of the most important ones that you need to know as a landlord. Use them to protect yourself.