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Leasing 101: A Comprehensive Guide for Property Investors

Landlord and Tenant Discussing Lease Agreement Getting and owning single-family rental properties can be a thrilling and satisfying investment. Unlike other types of investments, there are several factors you need to understand to successfully go from a property owner to a landlord. Suppose you are a Semmes rental property owner getting ready to lease for the first time. Because of that, it is imperative to fully understand the basics of leasing strategies and, even more importantly, the laws that now apply to you and your renter. We’ve put together a comprehensive guide to get you started on leasing your first property. Implementing these easy guidelines can make your first experience a great one.

Renter Screening Process

One of the first and most significant stages in leasing your rental property is tracking down the right renter. What’s more, the way to achieve that is to have a good tenant screening process for each applicant. You’ll need to get information from your prospective renter to assist you in determining whether they are the ones you’re searching for. At a minimum, ask that they fill out an application that incorporates all intended home occupants’ names and birth dates (counting those under 18), five years of employment history, and at least three past rental references. You’ll also need to gather Social Security numbers for all adult renters and run a background check on each one. Then, call and verify the information on their application. Ideally, communicate with any previous landlords and get details on their renting history. It may take a little longer, but the more research you conduct before you sign that lease, the less likely you will be surprised in the future.

Avoiding Discrimination

As you advertise to and screen renters, it’s essential to avoid discriminating against potential renters, even if it’s unintentional. Various federal laws make it prohibited to discriminate against a renter based on race, sex, color, national origin, religion, handicap, and familial status. These laws include:

  • Fair Housing Act (FHA): The Fair Housing Act (FHA) is a federal law that prohibits discrimination in housing based on race, color, national origin, religion, sex, familial status, or disability. The FHA addresses all components of the rental process, including advertising, tenant selection, and terms and conditions of tenancy.
  • Americans with Disabilities Act (ADA): Also covered by FHA is a federal law that prohibits discrimination against individuals with disabilities. Landlords who own multi-unit buildings of 4 units or more are compelled to make reasonable accommodations for people with disabilities, such as offering accessible parking spaces or installing grab bars in bathrooms.
  • Age Discrimination in Employment Act (ADEA): The Age Discrimination in Employment Act (ADEA) is a federal law that disallows discrimination against individuals 40 years of age or older. Although the ADEA is primarily intended to protect employees, it also disallows discrimination in housing based on age.
  • Equal Credit Opportunity Act (ECOA): The Equal Credit Opportunity Act (ECOA) is a federal law prohibiting discrimination in credit transactions, including rental transactions. Under the ECOA, landlords may not discriminate against individuals based on their race, color, national origin, religion, sex, marital status, age, or because they receive public assistance.

Along with federal law, it’s critical to research state and local law. There may be other protected classes depending on local regulations.

As you write your rental ads, avoid using language that could be considered discrimination, such as declaring that you will not rent to seniors or people with children or that you won’t rent to those who live on government assistance. Then, as you receive applications and screen renters, fairly assess your applicants based on the information they provide and not on other criteria. By maintaining professionalism and applying an unbiased screening system, you can avoid discriminating against any potential renters.

Understanding Reasonable Accommodations

Similarly, it is vital not to assume that someone with a disability is naturally not a decent candidate for your rental property. Under the Federal Fair Housing Act, Semmes property managers are required to allow “reasonable accommodations” for their renters, should they be essential. By definition, a reasonable accommodation is “a change, exception, or adjustment to a rule, policy, practice, or service that may be necessary for a person with a disability to have an equal opportunity to use and enjoy a dwelling.” If your prospective renter otherwise meets the criteria for renting your property, accommodation should not be a reason to turn them down. The accommodation a renter requests would be paid for and installed by the renter, with the arrangement that they will return the property to its original condition upon move-out.

Other accommodations include allowing service and emotional support animals in the rental property, even if you have a strong policy banning pets. Service and emotional support animals are excluded from a rental pet policy. You may not pay additional rent or fees should a renter keep a service animal on the property.

Following all of the laws and best practices for leasing rental properties might be tricky. Why not assign this vital responsibility to a professional property manager? At Real Property Management Azalea City, we give clear and anti-discriminatory screening and leasing services to help our rental property owners select the best possible renters. Contact us today or call us at 251-345-6224 to learn more.


Originally published on June 4, 2021

We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.

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