Having been in real estate for 30 years as a licensed agent, I understand the desire an agent feels to help out, and more importantly to look out for the best interests of their clients. However, sometimes even with the best intentions, a client you helped to either rent a place may find themselves at odds with the landlord and wants to sublease; or may suddenly need a roommate, or need to replace one. Here are four common mistakes someone in your client’s position should be aware of and which you could advise them of.
1. Not going over the contract extensively
Before they sign the lease go through each section to ensure that they can legally have a roommate. Your client should communicate with the landlord that they are interested in having a roommate, so they can be added to the contract, and thus held to the standard and terms that have already been agreed to. If they’re allowed to have a roommate, be sure to create a list of all the details for the roommate, this includes: parking space, how the utilities will be broken up, how you will keep the common area rooms clean, and of course how they will be splitting the rent. Be sure the roommate agrees to and understands this contract. In other words, communication with your roommate and landlord is key.
2. Not doing a walk-thru prior to signing a lease
Your client should always do a walk-thru before signing the lease. During the walk-thru they should make sure all systems are operating, look for cracks, stains or anything that can be considered damage that they did during your time in the property. Take notes and pictures as you go thru the property. I would recommend creating a second walk-thru checklist that they and the new potential roommate each sign, or have the new roommate sign the original checklist.
3. Not having renter’s insurance
As a multifamily property investor, I find that many renters do not carry renter’s insurance. I highly recommend finding a good carrier and spending the money on a good policy. Renter’s insurance is especially useful when having roommates as mishaps can and will happen. A good policy may cost as little as $12-$15 per month but it will cover a replacement of your TV or laptop if it is stolen or damaged by a leak (many leases carry a clause that the landlord is not responsible for your personal property if it is damaged by a leak). Many policies will also cover property loss even if it was off premises, so if your car is broken into and your laptop is stolen it may be replaced. Some renter’s insurance policies may even cover you if your dog bites someone in the park.
4. Not screening your prospective roommate
If your client is going to sublet a room, be sure they screen their potential roommate even if they are a friend of someone they know since their friend may not know the true reason this individual is looking for a new place to live. A thorough tenant screening, which often includes a credit check, criminal background, and an evictions/liens and judgements search, may help shed some insight as to the renter’s motivation for moving to a new home.
Renting a great place to live can allow your client to create an environment in which they can excel; but they shouldn’t take short cuts when looking for a roommate as it can make your new home a living hell. Following the tips above can help save time, effort, money and lots of headaches for landlords, current and prospective tenants.
