Rental Property Investor · Minneapolis, MN · Member since 2019 · 25 posts · 11 votes
I’m recently closing on a duplex it is occupied, so if I decide to keep tenants (which I’ll probably do) on a month to month lease. My question is how do I come up with a Comprehensive straight forward renters lease.
#1 should I make it mandatory for them to get home renters insurance?
#2 No pets?
# no smoking ?
What are some of the things I’ll need to include?
Of course do date on rental and late fees I have that part but I feel I’m leaving out a lot.
My final question is what is the best method to collect rent my fiancé like the old fashion way to collect in person but I want to cut that completely out and set it up online. Which is the best option? Thank you so much in advance
Lender · White Bear Township, MN · Member since 2016 · 1k+ posts · 1k+ votes
6y
@Jarvis Naylor I operate similar to @Dillon Dale. I used the MN Bar Lease which I believe is the lease that Dillon is referring to. It is the most common lease in MN. There is another widely used lease from the Minnesota Multifamily Association, it is a suitable alternative. You can get the BAR lease at this link
I also have 4-5 pages of addendums that cover rules and fines, which are important because not every lease violation will result in an eviction so you will need fines for minor violations.
My thoughts on your questions in bold
#1 should I make it mandatory for them to get home renters insurance? I do not make it mandatory, which leaves some risk if the renter is at fault. The BAR lease does warn tenants in writing that your insurance does not cover the tenant's belongings.
#2 No pets? We have always allowed neutered cats. We do not require a cat be declawed but require they have a scratching post for the cat, and that they sign in writing that if the cat urinates they agree to pay for carpet replacement (so far this has never happened with an authorized neutered cat) we had one tenant sneak in an unneutered cat that did urinate. We replaced the carpet and pad at the tenant's expense.
We allow small dogs in some properties dependant on the finishing. We have many restrictions for breed and size and we have higher minimum criteria for a tenant with a dog.
We limit total pet count to 2 pets regardless of type (no fish allowed) all pets must be declared and approved by us.
No pet rent or extra deposit on cats, both pet rent and extra move-in fee for dogs.
In general, I recommend you come up with a reasonable pet policy that you can live with and allows you to rent to some pet owners.
# no smoking ? I recommend you do not allow any smoking of any kind indoors in your properties. I would not bend on this item, the smoking damage is real and will turn off many good future renters.
What are some of the things I’ll need to include? You should include rules about, noise, parties, lost keys, local violations about that cause fines, these can include garbage, police calls, sidewalk snow removal if tenants are responsible. Other rules about move-in times, paying rent and deposit by a certain date, what happens if they sign the lease but back out of the lease. You should have conditions related to when they get their keys, parking (# of cars, location, and guest parking), guest damage, overnight guests, communication, and how to report maintenance.
For rent we require tenants pay by cozy.co, I recommend this or a similar service dedicated to rentals. In other words, do not use a generic payment service like Zelle, Venmo, or PayPal. Those services pal in comparison. They do not remind tenants of upcoming payments, they don't help you will easy to use downloadable reports for your MN CRP reporting, they do not remind you of the end of the lease term, they do not automatically add a late fee, and I don't believe they all allow for auto-recurring payments.
Feel free to PM me if you would like to meet up and discuss more.
Investor · Las Vegas, NV · Member since 2013 · 8k+ posts · 10k+ votes
6y
You’ll have to honor their current leases so I would probably look at those before you close and see if there are any problems with the lease or you may be able to use that one going forward.
Google Minnesota landlord laws and you’ll get a pamphlet pdf from the state that answers most of your questions, including the biggie for me from out of state. The security deposit must be in a seperation account and you must pay interest on their deposit.
Rental Property Investor · Minneapolis, MN · Member since 2019 · 25 posts · 11 votes
6y
@Bill Brandt thanks for that advice! And taking the time to answer I’ll get tight in that because it’s a few new things that you mention that is definitely great advice as something I need to look into
Real Estate Agent · Southington, CT · Member since 2008 · 5k+ posts · 3k+ votes
6y
@Jarvis Naylor I would either have an attorney write up a boiler plate lease for you (a template that can be used for each tenant) and/or connect with an experienced landlord in your area and see if they can provide you a remplate they use as a way to guide you.
Regarding the things you mentioned I would definitely clearly spell out in your lease how you are planning to handle renters insurance, pets, smoking, etc.. You want everyone to be on the same page with these issues and others that come up commonly in a landlord/tenant relationship.
Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
6y
@Jarvis Naylor lawyers can be a good start but their leases can be lacking in coverage and too confusing with legal jargon that neither you or your tenant will understand.
BP has a Lease and other documents available for purchase of included as a PRO member. It's vetted for each state and I think it's pretty strong.
You can also find a local investors group and try to get recommendations from someone locally.
Another option I recommend is to search "residential lease agreement PDF" on Google and you'll find hundreds of examples. Collect the clauses, format, or language that you prefer and then take it to an attorney to build what you want. But that's probably overkill for most Investors.
Real Estate Agent · Owatonna, MN · Member since 2017 · 221 posts · 152 votes
6y
@Jarvis Naylor I use the standard Minnesota residential lease agreement and add anything else not stated as an addendum. As for rent collection, I've used both cozy and zillow rental manager. I prefer cozy because it seems to be more comprehensive.
Lender · White Bear Township, MN · Member since 2016 · 1k+ posts · 1k+ votes
6y
@Jarvis Naylor I operate similar to @Dillon Dale. I used the MN Bar Lease which I believe is the lease that Dillon is referring to. It is the most common lease in MN. There is another widely used lease from the Minnesota Multifamily Association, it is a suitable alternative. You can get the BAR lease at this link
I also have 4-5 pages of addendums that cover rules and fines, which are important because not every lease violation will result in an eviction so you will need fines for minor violations.
My thoughts on your questions in bold
#1 should I make it mandatory for them to get home renters insurance? I do not make it mandatory, which leaves some risk if the renter is at fault. The BAR lease does warn tenants in writing that your insurance does not cover the tenant's belongings.
#2 No pets? We have always allowed neutered cats. We do not require a cat be declawed but require they have a scratching post for the cat, and that they sign in writing that if the cat urinates they agree to pay for carpet replacement (so far this has never happened with an authorized neutered cat) we had one tenant sneak in an unneutered cat that did urinate. We replaced the carpet and pad at the tenant's expense.
We allow small dogs in some properties dependant on the finishing. We have many restrictions for breed and size and we have higher minimum criteria for a tenant with a dog.
We limit total pet count to 2 pets regardless of type (no fish allowed) all pets must be declared and approved by us.
No pet rent or extra deposit on cats, both pet rent and extra move-in fee for dogs.
In general, I recommend you come up with a reasonable pet policy that you can live with and allows you to rent to some pet owners.
# no smoking ? I recommend you do not allow any smoking of any kind indoors in your properties. I would not bend on this item, the smoking damage is real and will turn off many good future renters.
What are some of the things I’ll need to include? You should include rules about, noise, parties, lost keys, local violations about that cause fines, these can include garbage, police calls, sidewalk snow removal if tenants are responsible. Other rules about move-in times, paying rent and deposit by a certain date, what happens if they sign the lease but back out of the lease. You should have conditions related to when they get their keys, parking (# of cars, location, and guest parking), guest damage, overnight guests, communication, and how to report maintenance.
For rent we require tenants pay by cozy.co, I recommend this or a similar service dedicated to rentals. In other words, do not use a generic payment service like Zelle, Venmo, or PayPal. Those services pal in comparison. They do not remind tenants of upcoming payments, they don't help you will easy to use downloadable reports for your MN CRP reporting, they do not remind you of the end of the lease term, they do not automatically add a late fee, and I don't believe they all allow for auto-recurring payments.
Feel free to PM me if you would like to meet up and discuss more.
Rental Property Investor · Byron, MN · Member since 2015 · 71 posts · 34 votes
6y
@Tim Swierczek Thank you as I was looking for similar information! I have the BP lease as a pro member but there is more to include to protect our investment! Thanks Tim!
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