My brother @Joshua Smith and I will be finishing a renovation soon and looking to begin leasing up our four unit building. With Washington DC tenant laws as they are, we know it is very important to have a bulletproof lease that is written as much in favor of the landlord as possible. Where is a good place to procure this kind of lease?
If that is your major concern, consult a lawyer that has tenant-landlord experience in the District.
If DC landlords (or landlords in any tenant friendly area) could just write a lease to make the headache of tenant friendly laws, they would have. But what you can have is a lease, while not bulletproof, that will help you when problems arise.
Otherwise, screening is your friend. And I think (I haven't kept up with the legislation) you can't ask an applicant about previous criminal court matters, but there is nothing saying you can't go to dccourts.gov and look them up or the Maryland Court website and look it up yourself.
You know Ive been to housing court about half a dozen times and sat through 50 to 100 cases each time. Ive only seen the judge in all that time ask to see a lease once. So i wouldnt put too much faith in a lease.
@M Marie M. Yes, I figured a lawyer would be the answer, so that may be the route to go. Just deciding whether to err on the side of caution and pay a lawyer to write a very landlord friendly lease, or to use the standard GCAAR residential lease that I found online. Does anyone have experience with how good this standard lease is?
Also, I was planning on using the BiggerPockets tenant screening service.
@Russell Brazil Thanks for your input. I'm just thinking that a well written lease could avoid some instances of issues ever going to court. If a specific situation is spelled out in the lease, maybe a tenant will more easily accept that, rather than take it to court.
Hey @Aaron Smith , M Marie and Russel are spot on with their advice. A lease can't overrule the city laws when it comes to tenant-landlord agreements, so writing an ironclad lease won't really impact things if you go to court. That being said, I think a very clear lease written in layman's terms that lays out your expectations to the renter, as well as how you intend to handle situations (just don't promise more than you can/want to do) will go a long way into setting expectations. Which I think is key. People tend to get upset when they feel like conditions or an agreement has been changed on them - it just feels like you're not being treated fairly. But if it's clear up front what both sides are responsible for, that can reduce that feeling of being wronged or treated unfairly (whether baseless or not) by the tenant. No one really wants to go to court, and if both sides know what they're signing up for that may go a long ways to keeping you out of there.
Also, if you treat people fairly and actually treat them like a person and show that you're invested in your property being taken care of and well maintained, most people will respond to that and in turn treat you and the property well. If you treat them like a cash-flowing machine, they'll treat you like a cash-taking one, which isn't good for either side.
I've had a townhouse here for 8 years now and have had roommates/tenants the entire time, and the only time I had a problem tenant was when I did a lazy job of screening them. A costly lesson. I've used www.mysmartmove.com for screening, but haven't yet used BP's.
The best thing you can do is familiarize yourself with tenant laws, know the situation from their side and what they are able to do, and then act in accordance with any and all landlord obligations your have to meet.
I've found this helpful:
@Robert Brown Thanks, I will definitely read up on the laws. Actually mysmartmove is the tenant screening that BP partners with, so good to hear some good feedback about it.
@Aaron Smith - I perhaps should have investigated who BP suggests. But it's a good check for me to know that I wasn't crazy for thinking they were good.
Depending on where you are in the city and how high demand is for your place, you can structure your fee for the credit check in a variety of ways. My approach has been that I ask for the applicant to pay the fee upfront, and then I'll reimburse the full or half the amount (or take it out of the first month's rent) if we move forward with the application and they move in. It puts a little bit of a burden on them up front to make sure they're serious about the place, doesn't cost you any money if they back out last minute or just never show up to sign the lease and never let you know why (it happens...), and if they move in you've made the first move in creating some goodwill between you two.
@Aaron Smith GCAAR contract is pretty good, however its not going to do much for you when you have an issue with a tenant. Best thing to do is vet your tenants completely and be willing to pass on tenants until you find the right candidate.
Create Lasting Wealth Through Real Estate
Join the millions of people achieving financial freedom through the power of real estate investing