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

4. Late fees and Penalties If you don’t have any late fees or any penalties for unpaid rent or rent paid late, then it’s going to be hard to enforce payment on time. You need to ensure your late fees and penalties are clearly stated in the lease.

5. Security Deposit

Explain the amount of security deposit required upfront — before the tenant moves in — and all the rules that go along with it. This includes your right to “go after” the security deposit if there are any issues with the tenant or your property, and especially if there’s damage to your property to the extent that repair is required on your end to fix damage done by the tenant.

6. Non-Payment of Rent

Just as you need to detail late fees and penalties, you also need to spell out what happens if they don’t pay you the rent at all. Include your right to file for eviction within a certain timeframe, etc., but also include any grace periods, if applicable. Above all, you need to protect yourself. Your tenants must pay you in full, on time, every month, and if they don’t, there will be consequences, such as eviction.

7. Alterations

Stipulate whether a tenant can make any type of alteration(s) to your home and property. For example, can they repaint a room? Replace the floor? Remodel a certain area? Think of every possible scenario; find out what is legal, find out your rights, and spell it out in the lease.

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