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I have a somewhat unique situation. I currently rent out 2 rooms in my home (I use the 3rd) to a friend and his friend. Soon I will be moving, but will continue to rent out the house to the tenants that are currently there. There is not currently a lease agreement in place, nor did they pay a security deposit when they moved in. My questions are: Should I require them to pay a security deposit now since I won't be in the house to unsure nothing happens? Should I require them to sign a lease agreement? I'm pretty sure I should do a lease agreement, but not sure about the security deposit. Thank you all for your help.
Why not have them sign a New lease with the LL. They can let your Deposit ride & each give You 1/2 out of their own pockets. Of course all this will depend on the LL.
I have a somewhat unique situation. I currently rent out 2 rooms in my home (I use the 3rd) to a friend and his friend. Soon I will be moving, but will continue to rent out the house to the tenants that are currently there. There is not currently a lease agreement in place, nor did they pay a security deposit when they moved in. My questions are: Should I require them to pay a security deposit now since I won't be in the house to unsure nothing happens? Should I require them to sign a lease agreement? I'm pretty sure I should do a lease agreement, but not sure about the security deposit. Thank you all for your help.
Yes to all. I don’t understand why you wouldn’t do that even if you were living in the house.
From this point forward...if you rent anything get a signed agreement
Why not have them sign a New lease with the LL. They can let your Deposit ride & each give You 1/2 out of their own pockets. Of course all this will depend on the LL.
I think there might have been some confusion. I own the house, so there was no security deposit paid. I am living in 1 room and renting out the other 2. Soon I am going to move out, but continue renting out the rooms.
It's so easy to fall into lease-less renting with people you know, and it is so easy for that to go horribly wrong. They should ALWAYS have a lease and ALWAYS pay a security deposit.
Let them know, "Hey, I should have done this when you guys moved in, but I didn't. That's on me. But now that I'm moving out, it's time to do this right. Here's a standard lease. It covers everything to protect both you and I. I think you'll see it's pretty much what we've had going, so no real changes there, but the biggest change is a security deposit, it's just one month's rent, so it's very reasonable."
How are you going to change things? Are they still going to just be renting rooms and you rent to a third new person? Are you going to offer them market value and they presumably split it, but the exact split and mechanics of how to pay are up to them? Who is responsible for all the maintenance (cleaning, taking trash out, yard maintenance, etc.) you've presumably been doing?
Why are you moving? How far? Why not just sell? Long distance landlording can be a huge pain and is the best way to turn small problems into big expensive problems.
The problem with 'no lease' is that neither you or they have any protection. Without a lease, YOU can raise the rent at any time, in any amount; decide to sell and simply tell them to move; make changes to parking, utilities, common areas, etc., .... etc. Without a lease, THEY can use the property and common areas however they wish; sub-lease or have live-in partners, animals or ??; pay the rent on time/late or in reduced amounts; ignore or deal with repairs/maintenance, etc., ... etc.
While you live on the premises, you have some oversight control of the property, but, once you move out, particularly if you are any distance from the property, someone else will be making the decisions about how the property is used. This is difficult enough if you are renting separate properties, but, trying to rent-out 'parts' of one property is a recipe for disaster.
YES! - Of course you should have a comprehensive lease! -- The damage/pet deposit is also for your own protection, however, this too can be an issue when dealing with common areas. Who is responsible - and to what degree, for damage to areas beyond their private living spaces? -- And what if one moves-out ... will you return their full deposit or pro-rate it on the basis of damages attributed to them? --- and if so, how will you adjust the potential damage liability of the other renter/s?
You may also have some zoning and other issues related to operating a "rooming house."
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