Susan Ormont - RISK VERSUS REWARD: A SIMPLE GUIDE FOR INVESTING IN REAL ESTATE

within the law. Check with your attorney on any legal uncertainties. • How many people will you allow to rent your house at once? For example, will you rent your two-bedroom house to a family of two adults and eight children? They might not seem like ideal tenants, but please be warned: You must make sure that whatever policies you put in place don’t violate any Fair Housing Act (FHA) laws. It’s a good idea to research FHA laws, rules, and other guidelines when considering renting to families with children. • Will you rent your house to people who have filed for bankruptcy? If so, how recent a bankruptcy filing will you accept? In addition, what are the bankruptcy requirements? For example, will you have different requirements for somebody who filed a Chapter 7 bankruptcy vs. someone who filed a Chapter 13 bankruptcy? • Will you rent your house to someone who has been through a foreclosure, short sale, or car repossession? If so, how recently? Many landlords don’t wish to attract these types of tenants, as they’re often viewed as “higher risk” and “lower quality.” • Will you accept Section 8 tenants? The Section 8 program allows homeowners to rent their property at fair market rates to qualified low-income tenants with a Home Forward rental subsidy. Some jurisdictions, which is the case in Massachusetts, require that you accept Section 8 tenants, regardless of your personal feelings. Check with your attorney to see what the requirements are in different states and towns. In the meantime, determine whether you’re willing to deal with Section 8 tenants, because this

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