9 Documents Needed For Your Tenant/Buyer

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So I see one of my friends that I haven’t seen in a while when I was in Florida, and she tells me I look disgustingly skinny (basically, she calls me a hideous freak). Well, I tell her that I’m training for a marathon, so I’m sure that has something to do with it. And here’s the other reason: I HATE cooking. I have the worst eating habits. If it’s not in the frozen food section, can’t be cooked in a microwave, or made by my personal chef (Mr. Boyardee), then I don’t eat it. Anyways. About two months ago I’m at Giant staring at the TV dinners and Healthy Choice TV dinners are 50% off (yes, you know where this is going). I pretty much bought out the store and now have a lifetime supply of Healthy Choice meals. The problem is, that these meals have about .003 calories. So over the next few months I will probably wither away and die (how come they couldn’t have Hungry Man dinners on sale….gosh!)

Before I start to look like Nicole Richie back in the day, let me go over the paperwork needed when you have found a tenant/buyer. Here are the 9 necessary docs.

  1. Property Condition Move-In Form – Walk through the property with the tenants and note any problems, blemishes, etc….
  2. Renter’s Insurance Form – The tenants have 7 days to fax back the form with proof of renters insurance (I also staple the card to the form of the agent I work with).
  3. New Tenant Information Form – A welcome letter for your new tenants. This letter should list the names and phone numbers of all utility companies, the day the trash is collected and anything else they need to know about the property.
  4. Property Maintenance Agreement – This form states that the tenants are responsible for the first $300.00 in repairs and they must also get a home warranty. (I have my tenants use American Home Shield).
  5. Option Agreement – States that the tenants have a one year option to buy the house at x amount of dollars. And that if they violate the terms of the rental agreement or any other agreements, the option becomes null and void. (This does NOT get recorded at the courthouse. You only record the option agreement between you and the seller).
  6. Payment Policy – This form only has a few sentences in huge font that state: Your company has a zero tolerance policy for non-payment of rent, that evictions start on the 5th and there are no exceptions. (and that you can murder them for non-payment of rent…..I wish).
  7. Property Disclaimer Form – This is the same form you signed with the seller. Each state has their own disclaimer/disclosures about the property.
  8. Lease Option Disclosure – This form says that the tenants understand they have an option to purchase this property. And that you might not be the owner of the property and may only have an interest in the property (this is important….in a sandwich lease option you only control the property and you need to disclose this).
  9. Rental Agreement – This should be iron clad and cover everything. My current lease is 7 pages. Make sure you have your lawyer review it. (Maybe in another post I’ll go over the key paragraphs of my lease).

Well, this week I’m headed to Florida again. I’m driving down, because I’m going to leave a car there….so I’m looking forward to a good ole’ 12 hour road trip. And in my car will be all of my real estate and marketing CD’s so it can be a productive 12 hours. By the way, right now in my microwave is my Healthy Choice mash potatoes (I think that’s how you spell potatoes, but I’d better ask Dan Quayle) and broccoli meal…..de-lic-ious! Til next week.

About Author

Jason R. Hanson is the founder of National Real Estate Investor Month and the author of “How to Build a Real Estate Empire”. Jason specializes in purchasing properties “subject-to” and has purchased millions of dollars worth of property using none of his own cash or credit.

5 Comments

  1. As a former tenant, I didn’t see the point in renter’s insurance. As a bachelor I wasn’t very materialistic. No flat screen tv, etc. I had a mattress on the floor, some basic kitchen items, toiletries, and my computer. I waited to buy furniture, etc until I had bought my own house.

    Situations vary, that’s all. If you want your tenants to have renter’s insurance require it as part of the lease agreement. I don’t think the state needs to nitpick your life or business.

  2. The real nice thing about renters insurance is that it protects your personal property as well. For instance, I have a friend who is a student and had her apartment broken into outside of Vegas and all of her valuables stolen. She has since bought a new laptop and has renters insurance just to protect that if nothing else. It is worth getting renters insurance to protect your personal property from being stolen really anywhere in the world. It can also run as cheap as $9 so you really have nothing to lose getting it.

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