- How Much Money Is Needed To Invest In Rental Property?
- Should A Real Estate Investor Get An Agent’s License?
- 5 Big Factors That Affect The Costs Of Renovating Your Home
- SIBOR Hike – What You Can Do With Your Current Loan
- 6 Basic Don’ts Of Real Estate Negotiation Tactics
- Will New Condo Relaunches Trigger The Great Property Sale We Have All Been Waiting For?
- 10 Proximity Amenities That Add Value To Real Estate
- How To Get Personal Loans More Easily With Good Credit
25 Real Estate Forms To Prepare Before You Need Them
If you fail to prepare real estate forms before you actually need them, then you are preparing to let small administrative issues affect your operations.
What’s worse is when a lack of a proper document encouraged you to make commitments without proper paperwork to backup whatever was done or agreed upon.
For example, how professional, or lack of it, would it make you look if a tenant had you agree to allow a dog in the house… but you forgot about it and made no mention of the special agreement anywhere.
Either you are a phony landlord or an incapable one.
Scrambling to draft a form within time constraints can make you prone to mistakes. It’s best to get this over with before you run into an ad-hoc situation where they are necessary.
Here is a list of forms to prepare and keep in your drawer so that you can access them whenever a need arise.
1) Application Process
This is a great document to give to prospective tenants so that they understand that you mean business and have a proper systematic process towards operations.
It can give all the right impression… that you are a responsible and credible landlord.
It should state the criteria and requirements to be accepted as a tenant. And more importantly what is the next step to take to move forward.
2) Tenant Application Form
There’s a reason why insurance agents and bankers carry application forms with them wherever they are. This is because they understand that the hottest prospects can appear anytime, anywhere.
And it’s best to strike when the iron is hot. Losing a customer for the lack of an application form can be a hard pill to swallow.
This is one of those forms that you want to carry with you everywhere. At least leave some of them in your car.
3) Employment Verification Form
You can’t take a stranger’s word as it is. People lie for every thinkable reasons. And one of those things they lie about is about their employment and income. This is so as to present a false impression that they can actually afford your property when in reality, they can’t.
This is when you need to verify tenants’ income claims by checking with their employers.
Make a mental note that a lot of corporations will resist responding positively to your request. But if, in fact, the prospect is not an employee of theirs, they’d often let you know.
That’s probably a key piece of material information.
4) Landlord Reference Form
If you are one of those landlords who just have to contact the tenant’s previous landlord, you might want to send the previous landlord a cordial document so that they would provide you with the information that matters to you.
Mention the name of the tenant you are making diligence checks on. And list down close-ended questions with at most a couple of open-ended ones.
You don’t want to make it a chore for the previous landlord in answering your inquiry.
5) Denial Letter
When you have declined an application, it’s only polite to respond to the applicant. More than that, the way you conduct this process of tenant screening can have legal implications.
So it’s best to have this template document to inform of applicants the reason(s) they were denied.
6) Letter of Acceptance
Buyers remorse can affect a huge number of people. Once you have reviewed an application and approved it, you’ll want to let the potential tenant know as soon as possible so that he/she can stop looking at alternatives.
Putting your acceptance into a formal document gives the prospect something concrete and also a peace of mind.
You’ll want to provide information here about what are the next steps to take in order to officially move in as a tenant.
7) Deposit to Hold Agreement
Money is a sensitive issue. And anything concerning the exchange or transfer of money should be documented properly.
Non more so than the security deposit (which will eventually be the security deposit) because it can be a significant amount.
It should also state the terms of the handling of this money and forfeiture criteria.
Don’t confuse this with a deposit receipt that ascertains the tenant has paid and you have received.
8) Lease Agreement
This is probably the most important document which you cannot afford to screw up on.
Take note that some people identify this contract as a Tenancy Agreement. So you might want to take that into consideration when drawing up this document.
This document is a legal contract that spells out the terms and conditions of leasing. Including the responsibilities of both parties.
To make sure a tenant understands and agree to each of your devilish terms, you might want to have them countersign on each term listed in your contract… or at least have them sign on each page.
9) New Tenant Guide
For all you know, you might have to deal with tenants who are renting for the first time. So a simple guide to help them understand industry jargon and basic processes could be very helpful in orientating newbies on how things are done.
10) House Rules and Regulations
This usually takes a form of a booklet or a set of paperwork that outlines property specific rules that your tenants have to adhere to.
Remember that too little rules can make you look like a pushover. And too much can make you look like a sadistic dictator.
11) Change in Terms of Lease Addendum
You cannot just change the terms of agreement according to your mood swings.
Any changes towards the terms of the lease must be acknowledged, and preferably agreed, by the tenant.
This form makes these changes a formal process where tenants acknowledge changes and updates to your terms and conditions.
Have a backup strategy in place in case the new terms are challenged.
Sometimes, potential tenants just do not fit the qualification criteria that you have set. It could be their profile or even their income level.
But you might not mind leasing out the property if there is a credible guarantor/co-signer involved.
This happens often when you are renting out to students or even expats. This is a form to make the 3-party relationship legally binding.
13) Estoppel Agreement
An estoppel pretty much explains itself. This is usually a formality when you encounter inherited tenants.
It’s basically a one-page form for tenants to fill up declaring the terms of their existing lease agreement to the best of their knowledge.
14) Pet Addendum
Dogs and cats are very common household pets that families like to keep. But they can be trouble as well.
This document would mention the specific identifiable pets allowed on the property. And state clearly the responsibilities of the pet owner including its’ behavior and actions.
15) Moving In and Moving Out Checklist
It goes without saying that you should itemize items in the house and document their conditions when tenants move in. And you’d want the tenants to acknowledge and endorse it.
This is so that when they move out, you can check the condition of your items to determine if expenses will be incurred in repairing and replacing damaged items.
This document is often also known as a property inspection checklist.
16) Lead-based Paint Declaration
Disclosing whether lead-based paint is used in the house is a necessity by law.
On top of that, tenants must acknowledge receipt of your declaration and pamphlet.
17) State specific regulatory forms
Each state would most probably have different documentation to be given to tenants. You need to find out what applies to your territory/geographic region and follow the requirements set by authorities accordingly.
18) Work Order
You might run into necessary maintenance works more often than you think. And you have to inform tenants of the types of works that will be conducted including when they will be conducted.
This is so that tenants know what is going on in the house they are living in!
Include fields in this form to fill in the description of the works that will be undertaken.
19) Pay or Vacate
Eviction is not as easy as it sounds on paper.
If a tenant fails to pay rental, it’s not as if it’s enough of a legal basis to chase them out of your property.
You need to give them legal notice in the form of a “Pay or Vacate” document.
20) Notice to Comply with Lease
It’s not enough to orally notify tenants to comply with the terms of lease. You need to document this so that you have something to back you up should you take further action in future.
When tenants break the rules, the usual practice is to serve them this document as some sort of warning.
21) Notice to Enter
Although the property legally belongs to you, you cannot simply barge in uninformed. The right to privacy is at stake here.
You need to serve such a notice before entering your property when it is tenanted. The advanced notice period varies from state to state.
So do a check with the agencies to find out what applies to you.
22) Moving Out Procedure
This should explain the process of handing over the property back to you when the tenant moves out.
Just like hotels, you would need a proper process of checks before signing off a tenant. Just that yours would probably contain more instructions and details.
23) Disposition of Deposit
One of the things that a tenant will never forget is to collect back the security deposit they initially paid from you.
And in most cases, they expect to get it back in full even when you feel otherwise.
This document will list down in detail why they are not getting back the full amount citing damages and miscellaneous stuff that they are being charged for.
24) Deposit Refund
Sometimes you are dealing with housemates and roommates. And the balance or whatever that is left from the security deposit requires the money to be split among the tenants.
To ensure that each tenant gets his/her share, you need to draft this form listing the persons and their new addresses to forward the refund checks to.
Get at least 3 points of contact including address, phone number and email.
25) Lease Renewal
What better way to avoid the awkward conversation of renewing a lease than to send a letter instead.
List down the possible options of renewal and inform the tenant(s) of how to proceed in renewing the lease.
This is an easy way to extend a lease. Even if tenants refuse to renew, they will inform you about it and you have time to work your magic in convincing them otherwise.