Rent Or Not To Rent
Here is the question
I have a house that that I am currently living in and I want to buy another that way I can rent the house I'm in now and start into real estate... However this is my question.. I have a firend that is interested in it, and explains that he will help me fix it up a bit.
Should I have him fill out a lease or not.
Is there any pro's or con's to not having a lease.. Would I have more control since there is no paper work?
Thanks everyone
If it is a business deal you need to document it so everyone is clear and can perform. If you just have an extra house to move your friend into and money and terms don't matter to you then I guess you won't be disappointed if they don't pay. Good luck
A national speaker's - Vena Jones-Cox - number one rule of landlording is not to rent to family or friends.
But if you decide to rent to your friend then you need to treat it like a business. You should have your friend fill out a rental application and you should screen him. Would it surprise you if your friend had an eviction, criminal record, bankruptcy, or charged off accounts? Most people keep their economical ill health to themselves.
At the very least, get a lease signed. There will always be an implied lease, even if you do not sign one. I have a land lord friend that let a friend move into one of his vacant rentals for a week. The friend gave him some money for the use of the house. Guess what - the friend became a tenant. My friend had to evict his tenant because they then refused to move out.
Being a land lord and doing a rehab is serious business. You need get your insurance changed to a land lord policy or you will not be covered. You need to have in writing what repairs your friend will perform, who will pay for materials, by what date it must be done, to what quality standards it should be done and what happens if he fails to perform his end of the repair work.
Not to scare you, but this is the reality of being a landlord.
Brenda