Follow the steps below to rent your property easily:
Step 1 – Show Your Rental Unit to Tenants
The first step in renting out a house or an apartment is to allow people to view the property. If tenants like the property and want to move in, they will likely inquire about the rent amount and other details.
Hosting viewings can be inconvenient if you have multiple properties, so many landlords hire a property management company to show their rental units to potential tenants.
Step 2 – Give the Tenant a Rental Application Form to Fill Out
Once you agree on the rent price, the tenant should complete a rental application. This form helps the landlord screen the tenant, and it includes information such as the applicant’s:
- Name
- Current address
- Place of employment
- Income level
- Rental references
The tenant can confirm their workplace using an employment verification letter. This document is accessible for renters to show proof of income.
Typically, landlords require a small, non-refundable fee from the tenant to process the rental application.
Be aware of what you can and can’t ask on a rental application to abide by federal laws and prevent discrimination in the selection process.
Step 3 – Run a Background and Credit Check
After reviewing the tenant’s application, you should run a background check (and/or a credit check).
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Running a credit check as part of the tenant-screening process can help avoid scams and problem tenants. The tenant usually pays for the cost of a credit check.
A background check shows if the applicant has a prior criminal history, and a credit check confirms whether the applicant has good or bad credit. Bad credit may signify poor financial planning, resulting in missed rent payments.
Although these checks help you avoid dealing with bad tenants, you shouldn’t base your decision to rent the property solely on the results.
Many states have strict guidelines on tenant discrimination. Refusing tenancy because of minor criminal offenses or bad credit may justifiably violate federal anti-discrimination law.
Step 4 – Check the Tenant’s References
Next, you must check the tenant’s references in their rental application form mentioned in step 2.
You should contact the references and ask questions such as:
- Did the applicant pay their rent and utilities on time?
- Were there any noise complaints at the tenant’s previous apartment?
- Have the police ever been called to the tenant’s last rental unit?
- Would you consider renting to this person again?
Rental references are usually from current or previous landlords and can give insight into the tenant’s character and behavior.
Step 5 – Create a Lease Agreement
Once you’re happy to rent your property to a tenant, you must create a lease/rental agreement in the correct format.
You make a lease agreement by writing it yourself from scratch, filling in a blank lease agreement template that includes all the necessary clauses, or using a lease agreement builder to create a lease specific to your property.
Remember to include the following:
- The move-in date
- The monthly rent payment amount
- When the rent is due each month
- How you’ll handle late rent payments
- Who should pay or manage the utilities
- The penalties, if any, for breaking a lease
Both parties sign the agreement after you create the lease contract and review all the details with the tenant. You may need to calculate prorated rent depending on when the tenant moves in.
Step 6 – Hand Over the Keys
Once the lease agreement is completed and signed, give the tenant the keys to move into the property.
Remember to conduct a unit walkthrough alongside the tenant to finish the process. Bring a rental inspection checklist and document the property’s condition before the tenant moves in.
Step 7 – Renew or Terminate the Lease
Allow the tenant to remain on the property until the lease termination date. If you thought your tenant was responsible and you want to renew their lease (and they also want to renew), use a lease renewal agreement to renew their tenancy.
If you don’t want to renew the lease, use a lease termination letter.
Landlord and Tenant Laws by State
Federal law recognizes that landlords and tenants have individual legal rights and obligations.
Find out what the law in your state says about your rights using the table below, or check the following specific laws for your property:
Landlord-Tenant Acts
Here are the general landlord-tenant acts by state:
Landlord’s Access
Tenants have the right to privacy when they rent a property. However, there may be reasons why a landlord needs to access the property, such as for maintenance or inspections.
Nearly every state requires a landlord to give advance notice to their tenants before accessing a rental unit. Use the table below to check how much notice you need to give in your state and review the relevant law:
| State | Advance Notice Requirement | Law |
|---|---|---|
| Alabama | 2 days | § 35-9A-303 |
| Alaska | 1 day | § 34.03.140 |
| Arizona | 2 days | § 33-1343 |
| Arkansas | Not required | N/A |
| California | - 1 day - 2 days for move-out rental inspection |
Civil Code 1954 |
Security Deposit
Each state regulates the maximum amount of money a landlord can collect as a security deposit from a tenant. Some states also require landlords to return security deposits to tenants within a specific time (potentially with interest).
Usually, a landlord can deduct the following costs from the tenant’s security deposit:
- Unpaid rent
- Cleaning costs
- Key replacement costs
- Cost to repair damages above ordinary wear and tear
- Any other amount legally allowable under the lease
Use the table below to see the maximum security deposit limit in your state, whether it needs to be held in a separate account, and how much time you have to refund it after the lease ends:
| State | Maximum Deposit Limit | Held in Separate Account | Refund | Law |
|---|---|---|---|---|
| AL | 1 month's rent | Not required | 35 days to return deposit | § 35-9A-201 |
| AK | 2 months' rent, unless monthly rent is greater than $2000 | Escrow account required | - 14 days to return deposit - 30 days to return deposit if tenant doesn't provide proper notice |
§ 34.03.070 |
| AZ | 1½ months' rent, unless tenant volunteers to pay more | Not required | 14 days to return deposit | § 33-1321 |
| AR | 2 months' rent unless landlord owns fewer than 6 rental units | Not required | 60 days to return deposit | § 18-16-304, 18-16-305 |
| CA | 2 months rent (if unfurnished) or 3 months' rent (if furnished) | Not required | 21 days to return deposit | Civil Code 1950.5 |
Lease Terms to Know
Here are some helpful definitions for the legal language commonly present in lease and rental agreement forms:
- Access: The right to enter a property.
- Accidents: Artificial or naturally occurring events that may damage a property (fire, flood, earthquake, etc.).
- Alterations: Modifications made to a property.
- Appliances: Standard home equipment like a refrigerator or dishwasher.
- Assignment: The transfer of an interest in a lease.
- Attorney Fees: A payment made to a lawyer.
- Condemnation: The government is seizing private property for a public purpose, such as highway construction.
- Default: When a breach of contract occurs and persists, such as not paying rent or violating other terms of a rental agreement.
- Furniture: Standard home equipment such as couches, tables, beds, etc.
- Guarantor/Co-Signer: Someone accountable for paying rent if the tenant cannot.
- Guests: Short-term occupants of a rental property.
- Joint and several liabilities: Two or more people are independently held accountable for damages, regardless of who is at fault.
- Late Rent Fee: An additional, reasonable sum of money paid by a tenant after making a rent payment past the due date listed in the landlord-tenant agreement.
- Noise Policy: A provision outlining “quiet hours” in the apartment building, condominium, or neighborhood.
- Notice: A written announcement of some fact or observation.
- Option to Purchase: The tenant’s right to purchase the rental property later.
- Parking: Designated spaces where the tenant can keep their vehicles.
- Pet Policy: The permission or restriction of a tenant’s ability to have an animal in a rental property.
- Property Maintenance: Preserving a rental unit and who is responsible. Such as cutting the grass, removing the garbage, or unclogging the kitchen and bathroom drains.
- Renewal: A tenant’s option to continue the lease.
- Renter’s Insurance: A paid policy that protects personal belongings against theft or damage.
- Severability: A clause of a lease stating that if one part of the agreement is invalid for any reason, the rest of the lease is still enforceable.
- Smoking Policy: The permission or restriction of a tenant’s smoking ability inside a rental property.
- Sublet: A temporary housing arrangement between current and new tenants to rent all or part of the currently leased property. The subletting period must be for less than the lease term.
- Successor: Someone who takes over the obligations of a lease from a tenant or landlord.
- Utilities: A public or private service supplying electricity, water, gas, or trash collection to a property.
- Waterbed: A water-filled furnishing used to sleep and not typically permitted in most rental properties.
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