Renting out a property is a significant commitment that requires attention to detail and adherence to regulatory standards. Having the required rental paperwork as a landlord is critical to protecting your investment, maintaining a healthy landlord-tenant relationship, and ensuring a stress-free tenancy.
Limestone Country Properties put together this article to guide you on why you need to organize important rental documents.
Importance of Landlord Documents
Let's first discuss why keeping track of your paperwork is important. Most landlords and property management businesses keep documentation of their lease agreements, payment receipts, and other important paperwork for a variety of reasons.
Accountability
The main reason for keeping records is to hold everyone who is involved in the lease agreement responsible. Keeping a copy of your rental contract guarantees that you understand what was and was not included in the initial contract.
Furthermore, if you have a problem with a renter, you may immediately refer to certain areas of the agreement and easily enforce the rules.
Accountability is important when you are a landlord as you want to ensure that your tenant also holds up on their end of the bargain.
Court Hearings
You may have to appear in court as a landlord when you own a rental property. If this is ever the case, you'll want to have as much rental documentation on hand as possible if the need to evict a renter or issue with a security deposit arises.
While verbal agreements can be acceptable, having a copy of the document with all parties' signatures ensures that the agreement is clear. Making sure you have everything on file allows you to back up your claims with documentation that the renter is aware of the terms you're presenting.
Bookkeeping
Keeping documents on file means you are maintaining more efficient business records and processes. Leases can help you plan your marketing strategies before agreements need to be renewed and understand financial goals based on your data.
Having your security deposit receipts and lease agreements on hand can assist you in tracking the money you’ve received and ensuring that it is properly documented, stored, or reimbursed.
Reliability
Ultimately, keeping your documents organized is a good practice for consistency and business continuity.
Working as a landlord can be challenging at times, especially if you have a mix of month-to-month and long term tenants. There's a lot to manage and monitor, and it can be especially difficult if you’re doing things on your own.
It can be overwhelming to make sure that you have completed all your tasks and have all the necessary information.
Creating an orderly system for papers and forms required for signing, filing, and backing up will assist you in maintaining consistency in your company process.
An established filing system not only guarantees that all necessary documents are handy, but makes sure your company remains organized, which can lead to business growth.
Rental Documents You Must Keep
Now that you understand why you should maintain rental papers on file, let's talk about the documents that should be included in record keeping. These four aspects form the basic structure of landlord documentation.
Lease Contracts
The leasing agreement is the most important document to have on file. Both the landlord and tenant should keep a physical copy for the duration of the lease and for the next year in case any issues come up. It's also strongly recommended to keep a soft copy in case the original is damaged or destroyed.
If you need to declutter, you can easily dispose of the paper copy and preserve only the digital copy once the lease expires.
Lease Modifications
If you and your renter make any modifications to the contract within their tenancy, you should include the updated copy in the lease agreement as well as keeping the signed copy. Just like the lease contract, make sure to keep a soft copy of the updated agreement.
These revisions become part of the original lease and are equally important.
Inspection Reports
Move-in, move-out, walk-through, and regular property inspection reports must always be maintained to have a complete record of the state of your property before, during, and after the occupancy period. This is useful if you need to justify keeping the security deposit and is also beneficial when scheduling repairs after a tenant moves out.
Notices
Everything from late rent payments to letters of non-renewal should be recorded and filed. Keep track of when the notices were issued, received by certified mail, and what steps will be taken next.
These notices are crucial if you need to appear in court, so make sure that they are consistently maintained.
Keeping Your Rental Paperwork Organized
Keeping your rental documents in order can be an overwhelming and time-consuming task, especially when you're dealing with a pile of paperwork and records that you haven't seen in a long time. While it is acceptable to take your time going over your old records, now is the perfect time to start keeping rental documents updated.
Creating templates that you can use for keeping track and recording tenant and property information has proven effective and brought success to landlords. Ensure that the templates you use are easily customizable to meet any property requirements and make both your and your tenants’ experience seamless.
It is much easier to manage paperwork when you know exactly how it looks and how to use it. Starting with a functional template system will make becoming organized easier than ever.
Hire a Property Management Company
If you have other commitments and need help in organizing your business documents on your behalf, you can hire the services of a property management company such as Limestone Country Properties.
We tackle all aspects of property management, from handling tenant applications and screening to bookkeeping and marketing your rental. We will approach each task with the energy and commitment that your investment requires.
Experience a hassle-free rental property business. Contact us today!
