Tenant Selection

[canadablue]

Hi

I have triplex and I have been in this business 2.5 years now. I have to select a tenant for my 3 bedroom unit and I had
good number of potential tenants inquires.
I have 3 rental application from which to select and I think I am more cautious now then in the beggining of me being landlord
because of all the information that is available to me about potential trouble with tenants.
I intend to use tenant verification service, and phone references and confirm employment.

My question is: when I enter into a lease agreement with tenant, could I draw my own lease agreement form with
clauses that could prevent future problems? For example: if tenant pays rent on time but does not pay utilities and they are
disconnected.... I would like to put that in agreement and have tenant sign it that it is a reason for eviction. Is that possible?

My other concern: some tenants seem a little bit too eager to get the place. Offering deposit right on the spot, offering help to get the place ready for renting sooner etc. Is that a red flag?

Your thoughts?

Thank you very much.

 

[bizaro86]

QUOTE (canadablue @ Oct 25 2010, 09:13 AM) Hi

I have triplex and I have been in this business 2.5 years now. I have to select a tenant for my 3 bedroom unit and I had
good number of potential tenants inquires.
I have 3 rental application from which to select and I think I am more cautious now then in the beggining of me being landlord
because of all the information that is available to me about potential trouble with tenants.
I intend to use tenant verification service, and phone references and confirm employment.

My question is: when I enter into a lease agreement with tenant, could I draw my own lease agreement form with
clauses that could prevent future problems? For example: if tenant pays rent on time but does not pay utilities and they are
disconnected.... I would like to put that in agreement and have tenant sign it that it is a reason for eviction. Is that possible?

My other concern: some tenants seem a little bit too eager to get the place. Offering deposit right on the spot, offering help to get the place ready for renting sooner etc. Is that a red flag?

Your thoughts?

Thank you very much.

The rules are different depending on what province you are in, so anyone needs that information to give you advice.

Regards,

Michael

 

[housingrental]

Where are you located?

 

[canadablue]

I am located in Ontario.

 

[bizaro86]

QUOTE (canadablue @ Oct 25 2010, 09:25 AM) I am located in Ontario.


My understanding of Ontario`s rules is that anything you add to the lease that isn`t mentioned in the act is unenforceable. I`m not in Ontario, though, so seek your own council.

A link for the FAQs on the Ontario Landlord Tenant board is here:

http://www.ltb.gov.on.ca/en/Key_Informatio...L02_111232.html

Michael

 

[invst4profit]

You are correct about leases in Ontario Michael.

And yes overly eager applicants can definitely be a red flag but may also only be overly eager people.
Doing a thorough credit and back ground search should alleviate your concerns. Make sure you insist on getting both present and previous LL contact info, SI#, employment info, photo copies of photo ID etc.

If a applicant balks at providing any of the info you request you should, to save time, immediately reject that applicant. Applicants with trust issues or those being evasive are generally headaches as tenants.

 

[creditinfocanada]

Well I think you may have been given some wrong advice.

I will agree with seeking your own council, adding instruments into you own tenancy agreement may in fact not be allowed or if anything not be honoured by any provincial court body, this happens all the time in Alberta. i.e. a landlord specifies they want late fees for late rent, ------ the court and the residential tribunal typically wave them.

Now, as per having perspective tenants that are overly eager, take into consideration this, if and I stress if, if your rental is desirable than your going to have an eager base of applicants, in other words if someone sees what they want of course they are going to be eager.

Use your credit tools, screen the applicants and pick the best ones.

 

[Berubeland]

In Ontario, with residential tenancies, there is almost no point to a lease because the Landlord & Tenant Board will not enforce clauses that are not part of the RTA.

Having said this... most tenants will in fact honor the contract they signed. Not every tenant is a deadbeat, most are decent folk. The key is understanding, people must understand their lease. It must be simple and clear.

Here`s a list of items that should be included in your lease if you have one.

Your name and address. * required by law
Rent Amount
Day and method of payment
If a condo, that tenants must follow condominium rules
The 2 page pdf from the Landlord & Tenant Board *required by law

Here`s some other items that are useful

When & Where to put out the garbage
List of appliances
List of lawn snow equipment
A page to orient the tenant in the area - laundromats, grocery stores, pharmacies etc.
Other rules you may have about noise or other issues

The lease should be a maximum of 4 pages, (2 pgs come from L&T Board)
It should be easy and simple to follow and read.
Make sure they read it and understand your rules.

 

[housingrental]

I do not agree with Berubeland`s above post.
What about items like tenant insurance?

Canada blue : your other questions have answered in the above posts so I won`t repeat. Go get a lease from your local apartment managers association and then add an extra last clause to it as a schedule A. Write in items as appropriate for your property on a schedule A (for example - tenant can`t pay rent by cash. payment by certified cheque, bank draft, or money order. additional phone numbers. what to do in even of X. tenant needs to provide rent to X location. Rent will not be picked up. Etc.)

 

[Berubeland]

You don`t agree with my post because I forgot to add tenant insurance?

You`d rather have complicated leases that no one reads and understands? I`d rather use it as a communication tool.

 

[housingrental]

Correct I do not agree with your above post. It is not correct and not in the interest of most property owners. Go ask a number of real estate lawyers that specialize in residential rentals and experienced property managers in residential rentals. You might be suprised at what you hear from them too.

I try to ensure all potential renters understand what it is that they are agreeing to.... and the lease documents that are to be found at most management associations in Ontario, and including a schedule A, are not a barrier to accomplishing this.

QUOTE (Berubeland @ Oct 29 2010, 09:03 AM) You don`t agree with my post because I forgot to add tenant insurance?

You`d rather have complicated leases that no one reads and understands? I`d rather use it as a communication tool.

 

[Berubeland]

QUOTE (housingrental @ Oct 29 2010, 08:01 AM) Correct I do not agree with your above post. It is not correct and not in the interest of most property owners. Go ask a number of real estate lawyers that specialize in residential rentals and experienced property managers in residential rentals. You might be suprised at what you hear from them too.

I try to ensure all potential renters understand what it is that they are agreeing to.... and the lease documents that are to be found at most management associations in Ontario, and including a schedule A, are not a barrier to accomplishing this.

I have many years in the business as a property manager and I`ve seen leases and used leases designed by real estate lawyers. They are absolutely incomprehensible to the average tenant, written in 9pt type, on legal paper and usually three double sided pages, at least in most of the buildings I`ve worked in. No tenants read them, in one building it took months and months to get the owner to sign them, and in one case we were dismissed because 9 months into the tenancy the tenant did not have a lease and in Ontario the tenant is not required to pay rent if they do not have a lease 21 days after moving in.

Nor have I seen buildings or real estate agents give out the required by law two page form in Ontario.

I fail to understand how this benefits owners or tenants. Specifically because almost every single item you can think of is already covered by the RTA and you cannot contract out of the law.

 

[ontariolandlord]

Housingrentals is correct.

A proper lease agreement is extremely important in Ontario, especially when a landlord moves to the jurisdiction of Ontario Small Claims Court.

Simply stating "the tenants can`t understand it" or the "landlord didn`t even read it" is not a viable argument for professional landlords and property managers who seek out careful and high quality tenants.

 

[housingrental]

"I have many years in the business as a property manager and I`ve seen leases and used leases designed by real estate lawyers. "

With your experience I`m sure you have see what happens when things go wrong - how unfair the system can be to landlords - and how it is important to pro-actively structure your business to meet property owners interests. There is a disconnect from this in some of your posts. Please refrain from posting on topics where you lack expertise. I trust you aren`t looking to have someone follow your incorrect advice and suffer losses in the future that could have been prevented.


"They are absolutely incomprehensible to the average tenant, written in 9pt type, on legal paper and usually three double sided pages, at least in most of the buildings I`ve worked in.
"

This doesn`t sound ideal. Instead of not using a lease, why not prepare a lease in the future with larger type, single sided, and take the time to explain important information and answer questions from future renters?


"I fail to understand how this benefits owners or tenants. Specifically because almost every single item you can think of is already covered by the RTA and you cannot contract out of the law."

Please re-read my above posts. Please explain how this is not a benefit to the owner having appropriate clauses in writing for items like:

Tenant insurance? - Do you prefer a tenant covers there own lost TV and claim $10,000 of caviar they had in their fridge? or Would you rather have the property owner cover it?

Utilities? - Do you like having the potential for disputes over which utilities the tenant is responsible for? Or do you prefer certainty and minimizing liability? Do you prefer to be able to get tenant to be liable for a default on bill that gets billed back to owner from utilities in many municipalities? Or do you think a property owner should absorb this?

Where rent needs to be provided - Do you enjoy having to pick it up from the tenant at the start of each month if they claim this was what the arrangement was? And rent wasn`t paid because you didn`t come? Or would you rather it be specified where the tenant has to be provided rent to?

Included services - Are you providing garbage pickup from the apartment door? Or is it tenants responsibility for putting the garbage in a far walk away?

Smoking - Interference of reasonable use and enjoyment of premises of other residents? Damage to property?

Clarity on rights or responsibilities - Or do you prefer potential for ambiguity that forms the basis of a tenant complaint against a landlord? Do you like having to waste hours of your time, and have a less happier resident, when they have a different set of expectations than you do?

This can go on and on.... Try reading through a lease you can find at your local property managers association... Chances are each clause is there for a good reason.

Just because you might not have yet encountered a benefit to them, doesn`t mean they don`t potentially provide a benefit.

 

[housingrental]

You are agreeing with one of my posts?? What wonder is next to come?

QUOTE (ontariolandlord @ Oct 29 2010, 10:19 PM) Housingrentals is correct.

A proper lease agreement is extremely important in Ontario, especially when a landlord moves to the jurisdiction of Ontario Small Claims Court.

Simply stating "the tenants can`t understand it" or the "landlord didn`t even read it" is not a viable argument for professional landlords and property managers who seek out careful and high quality tenants.

 

[ontariolandlord]

I never doubted that you an elite property manager and surely in the top 1% of rental expert in Ontario. You are a true professional with standards.
QUOTE (housingrental @ Oct 30 2010, 02:28 PM) You are agreeing with one of my posts?? What wonder is next to come?
t=`96169`]
You are agreeing with one of my posts?? What wonder is next

 

[housingrental]

I like how you left out the part about this being from 98% not having much involvement with rentals

Thank you for the kind thought
QUOTE (ontariolandlord @ Oct 30 2010, 10:23 PM) I never doubted that you an elite property manager and surely in the top 1% of rental expert in Ontario. You are a true professional with standards.