This cry for help came from one of my clients through a voicemail message. Owning a rental property provides great tax breaks and potentially good financial returns, but it also exposes the individual to significant legal liabilities. This client didn’t know, but he was in a lot of trouble and needed to take a quick lesson on Landlord 101. My 25 years as a professional investor, owner, and real estate agent allowed me to put together the following list of 7 rules for my new one to study. investor-client.

* Learn about your duties, responsibilities and obligations as a homeowner. It is a business in which ignorance is NOT a defensible argument. If you have to go to court to collect your rent, evict someone or worse; Being sued by one of your tenants, you better know your job very well and be prepared, it could cost you the entire investment property and more if you are not.

* Join a group of “Apartment Owners Associations”. Become a subscriber and get involved in their discussions. This group provides career guidance and will help and support you to make your business of providing housing for others more profitable, easier to deal with, and more enjoyable. They will have real-time alerts on new local laws and proposals that may affect the business of apartment owners.

* Choose your tenants carefully! Be fair and color blind when interviewing potential tenants. There are strict rules on discrimination of any kind. Your own personal beliefs should not dictate who you rent from. Develop a consistent and clear procedure to always use when choosing your tenants. Fair Housing authorities test regularly and the penalties are severe.

* Keep your rental properties! Landlords who do not spend money on maintenance or repairs will invariably spend much more money defending their actions or will default in court when a tenant is injured or injured due to lack of maintenance. The value of a rental property is based on income and general physical condition. A clean, safe, and well-maintained property will always provide high rental values ​​with less rental turnover.

* Don’t get personal, seek legal advice when dealing with troubled tenants. There are a number of steps that must be followed exactly when enforcing lease or lease agreements. The correct forms must be used, time must be absolute, and even the wording of the document must be specific and appropriate for each situation. If not done correctly, the whole process must start over. Let the professionals handle these situations.

* Know your limits …! Even if you consider yourself a “handyman” and know how to swing a hammer or use a power tool, know when to call in the professionals. Can you really tackle a plumbing or electrical problem? Hiring the right professional could protect you not only from personal injury to yourself or your tenants, but from legal liability as well. The key here is to get it right; Don’t think of “expenses”, think instead of “tax cuts.”

* Assemble a team to help you run your business. Don’t wait until you need a lawyer to find one. Start by asking other homeowners in the area if they know anyone in the area. If possible, get to know them, find out what their rates are, their working hours, where they are located, etc. Do this for everyone. You will need a good plumber, electrician, roofer, flooring specialist, and painter.

By doing your homework, you will know exactly who to call when an emergency arises. Addressing tenant issues immediately is a good solid building block on which to build a strong relationship with the most valuable partner you will have in your rental business – YOUR tenant.