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Want To Rent Out Your Starter House? Talk With A Lawyer First

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If you are purchasing or building a new home and you don't want to get rid of the starter home you're living in, you could be thinking of listing it as a rental. This is a great way to make money, but you want to talk with a business attorney, such as Strauss Troy, before you let anyone sign a lease.

There are several legalities that go into opening your own side business and renting a house. You want to make sure you know what you're prepared for. Here are a few things to consider that an attorney will help you with.

Lease Agreement

Your lease agreement has to be cut and dry, and it has to be legal. For example, legally you have so many days you have to wait until you can evict someone, and you can only charge a certain amount for late fees. The attorney knows all of this information and can put together a great lease agreement for you. Your attorney can also assist with screening potential renters, to ensure their credit and background check is good. It's best to know the person's financial history before renting to them.

Insurance

The rental property will need a different type of insurance than just homeowners insurance. You will be liable for the people living on your property, so you need liability insurance, property insurance and more. The lawyer will look over your policy to ensure everything is included, and so you don't suffer financially if there is a problem. You may need to find a special insurance provider who offers this type of insurance for businesses.

Rental Laws and Codes

There are regulations and codes for properties that are leased out to tenants. The property may have to be inspected by someone from the city before you can rent it out, and your lawyer will make sure that the house is in a zone where it can be rented. Once the house is up to par you can list it for lease.

The lawyer will tell you how much you should be putting away for taxes at the end of the year, and they can help you make sure that everything you're doing with your business is legal. There are a lot of problems and risk that come into renting out your property, but if you go through a lawyer and make sure that your as protected as possible, it shouldn't be a problem. 


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