8 Things to Consider Before Renting to Tenants

There are great reasons for renting an apartment that is above the garage of your home to earn extra cash, or alternatively, you might want to take an extended vacation abroad while renting your entire home to tenants. If you want to make money from your Greenville home, then there are several things that you should do first.

Check Your Local Zoning Regulations

Before you rent a room or an entire home, you must check the local zoning regulations. You may need a permit to rent to tenants, and in some cases, an inspection of your property is required first. Failing to follow these guidelines can lead to financial fines or other penalties.

Check Your Tax Situation

When you are renting a home or a room, you will need to claim the payments on your federal, state and local tax documents. Contact a tax professional to understand the ramifications of renting rooms or a home to tenants. This can prevent financial problems later.

Protective Insurance Policies

If you plan to rent to tenants, then you should have the proper type of insurance policies in place first. While you may have a homeowner's insurance policy, it won't always cover any of the problems associated with renting rooms or entire homes. Contact your home insurance agent to learn more about protecting your finances with the proper policy.

Safety Features

Do you have the proper safety devices in a home for renting to tenants? You may need to install additional smoke detectors or emergency exits before renting to someone. When you are renting an apartment above a garage, you must have proper ventilation to avoid problems from carbon monoxide.

Screening Tenants First

It is essential to screen a tenant first according to legal guidelines. You may not want to rent a home or a room to someone with a criminal background or a poor credit history. While doing background checks, you should have the tenants pay for the investigations.

Preparing a Lease Agreement

Contact an attorney with an understanding of preparing residential lease agreements. This document will protect you when a tenant fails to pay or damages a building due to negligence. A lease should have dates for moving in and moving out along with the charges for cleaning deposits and rental charges.

Additional Restrictive Guidelines

While renting a home or a room, you may want to have additional restrictive guidelines, including excluding pets or overnight guests. You can also restrict activities such as smoking cigarettes or drinking alcoholic beverages.

Furnished or Unfurnished?

If you aren’t worried about your furniture and appliances, then you can rent a room or a home with its contents, but you can expect to see normal wear and tear on these items. Alternatively, you can store your possessions in a storage unit in another location, but this choice will reduce your profits.

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