Watch the small print on your rental agreement. Protect your (the owner) interests or your client's interest!
If you are unable to sell your house and decide to rent, make sure, when you sign those property management papers with the rental agent, you read the whole contract.
You might miss some important clauses that can cost you big bucks.
Watch for;
- Exclusive listing rights when you decide to sell your house; this has become common place however some property managers haven't a clue how to market a house. These fair market listing agreements are based on what the property managers deems to be a fair market commission...
- Automatic percentage rate increase of what you pay your property manager; on one occasion I reviewed a property agreement that was a 3 year deal. The first year was a 10% fee, the second year 15%, and the third year was a 20% fee of the rent collected...
- Who is entitled to late fees? If you have a mortgage to pay you better make sure that you (the owner) receive the late fees to cover yourself.
- Repairs made without permission up to $1000. On my personal rental, I have a $250 limit. Anything over, I want to know about the repair before it is subtracted from the rent collected. I also want the invoice for said repair. For $1000, I want bids, not a handyman or the property manager's significant other.
These are but a few of the small print concerns my clients have found on property management agreements. Some are leget, some are of true concern, but all need to be addressed and understood.
Don't become a loser before your house is rented. Read and if you don't understand something ask questions or consult a professional.
Authored by Paul S. Henderson, Realtor ®, RE/MAX Professionals, Dupont & Lacey, WA.
(Specializing in Internet marketing strategies for positive results!)
(http://phenderson.net) or http://www.lacey-washington.com
©2009 Paul S. Henderson,Rentalnomics, All Rights Reserved
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