rental property: landlord legal basics

In short

A friend of mine bought a small duplex a few years back and thought the hard part was over once the lease was signed. It was not. If you rent out a home, you are running a small business, and the law treats you that way. The first step is to learn the rules where the property sits, since states and cities write most of them. Every promise belongs in a written lease. The deposit has to stay apart from the landlord's own money if the state requires that. The place must stay livable, proper notice must come before anyone enters, and every applicant gets the same standard. A landlord may never lock out a tenant or shut off the water to push someone out. Those steps protect the landlord, and they protect the people who call the property home.

The whole of it

What it is

I once watched an older landlord hand a young couple their keys with nothing more than a handshake. They were kind folks, and it still went sideways in a year, because nobody could agree on what had been promised. If you are holding a deed to a rental, you have probably felt that pull between being generous and being safe. The law offers a path through it. Landlord and tenant law is the set of rules that governs a rental. It covers the lease, the deposit, repairs, entry, fair treatment, and how a tenancy ends. Most of it comes from state and local law, so a rule that holds in one town may not hold in the next. A few rules come from federal law, and the biggest is the Fair Housing Act, which bars discrimination in housing. Know both layers and you stand on firm ground. Simple enough.

How it works

A neighbor of mine likes to say that a good lease is a friendship written down. There is wisdom in that. A lease is a contract, and it names the rent, the due date, the length of the term, and who pays for what. Many states require a landlord to put certain items in writing, and some limit late fees and deposit size. The deposit is held as security. In many states the landlord must keep it in a separate account, and a state law sets how many days the landlord has to return it. The landlord must also list any deductions, and normal wear and tear usually cannot be charged to the tenant. Repairs matter too. In most places the landlord must keep the home safe and fit to live in, which covers working heat, running water, and sound locks. Entry has rules as well. The landlord must give notice before coming in, except in a true emergency. When a tenancy has to end, the landlord must follow the court process. That means written notice first, then a case before a judge if the tenant stays. Changing the locks or removing the tenant's belongings is called a self help eviction, and most states forbid it.

The numbers, and where to find yours

If you are wondering what the limits are on your own street, you are asking the right question. The numbers vary by place, and they change, so I will not guess at yours. The maximum security deposit is set by state law, and in some states it is a multiple of one month's rent. The exact cap for your state is the current figure, which the official source publishes each year, and it comes from your state's landlord tenant statute. The number of days allowed to return a deposit is also set by state law, and it is the current figure, which the official source publishes each year. The notice a landlord must give before entering is set the same way, and so is the notice before ending a month to month tenancy. For fair housing, the federal rules come from the Fair Housing Act, and the U.S. Department of Housing and Urban Development explains them on its website. For lead paint, a home built before 1978 brings a disclosure duty, and the Environmental Protection Agency publishes the required pamphlet. Your state attorney general or housing agency often posts a landlord guide for free. Start there. It costs nothing.

A worked example

Let me tell you about a landlord named Margaret. She owns a two bedroom house and rents it to a man named Daniel for $1,400 a month. In this story her state allows a deposit of up to two months' rent, so she asks for $2,800. That is 2 months at $1,400 each, or $2,800. She writes the amount in the lease and puts the money in a separate account, as her state asks.

Daniel stays for two years and moves out in good shape, apart from a broken screen door and a wall that needs a patch. The repairs cost $180 for the door and $120 for the wall, so the total is $300. Margaret sends Daniel a written list of the two items with the receipts. She also returns the rest within the number of days her state sets. The math is $2,800 minus $300, which leaves $2,500 owed back to Daniel. She does not charge for faded paint or worn carpet, since that is normal wear and tear after two years.

Notice how little drama there was. Margaret had a clear lease, a record of the condition at move in, and a habit of fair dealing. Daniel got what he was owed, and she kept her good name. That name is worth more than any single deposit.

Where it goes wrong

I have heard enough porch stories to know where landlords stumble, and I have stumbled myself. The first trouble is the handshake deal, which leaves no proof of what was agreed. The second is mixing the deposit into personal funds, which can break state law and cause real harm if the money is gone when a tenant moves out. Third, a landlord who ignores a broken furnace in winter may owe the tenant, and some states let a tenant withhold rent or make the repair and deduct it. Fourth, a landlord who walks in unannounced breaks the tenant's right to quiet use of the home. Fifth, and most serious, is any step that looks like discrimination. The Fair Housing Act bars it based on race, color, religion, sex, national origin, familial status, and disability, and states and cities often add more groups. Then comes the self help eviction. It feels quick, but it can bring heavy damages. The landlord has to go through the court. Patience wins.

Questions to answer before you leave this page

Do you know which state and local laws cover your rental, and have you read your state's landlord tenant guide from the housing agency or attorney general? Is your lease in writing, and does it state the rent, the term, the late fee, and who pays for each utility? Do you know your state's deposit cap and the deadline for returning it, and is the money held the way your state asks? Have you written down the condition of the home at move in, with dated photos, so a fair comparison is possible later? If the home was built before 1978, have you given the tenant the lead paint pamphlet from the Environmental Protection Agency? Do you apply the same screening standard to every applicant, and could you explain it plainly if asked? Do you know how much notice your state sets before a landlord may enter, and when an emergency lets a landlord skip it? And if a tenant stops paying, do you know that the court process is the only lawful road, and who you would call first?