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Posted by Jordan Muela in Property Management Articles
Make sure to read our introduction to this series on property management contracts.
While contracts can range in size from 3-10 pages, 5-6 is average. Some are comprehensive, while others are very basic. While we can't tell you what exactly what the agreements you see will look like, there is a good bet they will contain some of the items outlined below. Remember that each management company must be viewed in its entirety when compared against another. While some issues are more important than others, making a true comparison between the property management companies you interview requires taking into account the full scope of their management fees and services.

Here are some things to pay attention to in the property management contracts you review:

Introductory paragraph(s)

Most contracts start off by stating this is a legally binding exclusive management agreement and then naming the parties to the agreement and the legal address of the property being managed. This is also typically the section that communicates the broker will be working on behalf of the owner in the managing of the property. Terms like "Grant", "Employ", and "Appoint" all communicate that the owner is transferring agency to the broker. Agency is defined as:

Agency: n. the relationship of a person (called the agent) who acts on behalf of another person, company, or government, known as the principal. "Agency" may arise when an employer (principal) and employee (agent) ask someone to make a delivery or name someone as an agent in a contract. The basic rule is that the principal becomes responsible for the acts of the agent, and the agent's acts are like those of the principal ( dictionary.law.com)

Broker Responsibilities (AKA "Authority and Powers")

This is the section of the contract that should specify exactly what services you will be receiving and how those services will be performed. We have already covered the majority of this section in the following posts:

Handling Tenant and owner Funds

Property Maintenance and Inspections

Setting and Collecting Rent

Marketing, Screening and Retaining Tenants

Make sure that the contract contains a due diligence clause (AKA "best effort") where the management company states that they will do their best in the management of the property.

Extra duties

Some contracts contain a list of services that the agreement does not include or qualify as "work exceeding normal management duties". If this clause exists you need to find out what items are listed and what the billing rate is for these services. If a billing rate is listed, it likely may be "an hourly fee equal to the current monthly management fee". Otherwise the contract may state the fee shall be agreed upon before the work begins, in which case you want to find out more so there are no surprises down the road in the event you need any of these services. If the list is simply services they don't provide under any circumstances then make sure you are comfortable foregoing, or outsourcing the items listed. Services typically listed are things like modernization, refinancing, fire restoration, rehabilitation, process serving, advising on proposed new construction and assisting sales agents or appraisers. That said, sometimes the list can be more comprehensive and include things you might have assumed would be included in the management fee so its important to check the contract.

Legal compliance

Some contracts have a section entitled "Equal Housing Opportunity" which outlines compliance with fair housing laws. This is only part of the equation. Here is an example of a more comprehensive legal compliance clause:

"The parties will comply with all obligations, duties, and responsibilities under the Texas Property Code, fair housing laws, and any other statute, administrative rule, ordinance, or restrictive covenant applicable to the use, leasing, management, or care of the property." ( austinlandlord.com pdf)

Advances

This clause addresses the issue of the Agent expending its own funds to pay owner bills. Many contracts clearly indicate that the management company is not required to advance the owner funds. Others go further stating that while not required to advance funds, the firm retains the RIGHT, at its sole discretion, to advance funds to cover necessary expenses. The owner is of course obligated to make immediate repayment, and there may be fees if repayment is late (1.5% of invoice per month is average).

Owners representation

The purpose of this clause is pretty straight-forward, you are simply disclosing the facts about the property, your ability to enter into the agreement etc. Read it carefully and make sure you let the company know if there are any potential conflicts or if you are not sure about certain points.

Owners responsibilities/Duties

Here is where the owner's responsibilities in the relationship are outlined; pay close attention to see what you will be committing yourself to. The following are some of the items that may be included, some being more common than others. The contract may specify that the owner agrees to:

Not hire any other company to lease or manage the properties included in the agreement while the contract is in effect.

Not take any action that would jeopardize the management company's ability to offer the property for rent in compliance with fair housing laws.

Abide by restrictions on entering the property. This will vary, but the basic idea is that owners can not enter their property whenever they want once it is occupied as this would be in violation of the tenants rights. The restriction may only require informing the tenant before hand, or it may require the owner to notify the agent and work through them to schedule a visit.

Transfer security deposits paid by existing tenants to the management company (This may not be applicable depending on the laws in your state).

Provide broker with all necessary records and documents the management company will need to do their job.

Reimburse the management company for expenditures they make on behalf of the owner in the management of the property.

Immediately notify the management company in the event the owner's representations as described in the contract are no longer valid or if other circumstances have arisen that are legally required to be disclosed to the agent, are necessary for the agent to know to perform their duties, or would affect the habitability of the property.

Immediately inform the manager in the event the owner has missed payments (becomes delinquent) for financial obligations related to the property such as property taxes, insurance, HOA fees, and most importantly, the mortgage payment.

Not rent the property to anyone without the management company's prior consent.

Not deal or negotiate with current or prospective tenants about anything related to the management or leasing of the property, but instead refer them directly to the broker.

Maintain property in a condition necessary for it to comply with all relevant laws.

Set-up and maintain a reserve
These funds are used to paying day to day operating expenses making sure that services are performed promptly and bills are paid in a timely manner. A reserve of $200-$500 is normal for single family properties. The owner is obligated to maintain this reserve fund.

Maintain Insurance - See below.

Insurance

Find out what kind of insurance and what amount of coverage they require you to maintain. The contract will likely require that the policy cover the management company in the same manner as the owner and require notification in the event coverage is changed in the future. In some cases the contract may actually authorize the manager to purchase insurance on your behalf (at your expense) in the event you lack sufficient coverage now or in the future.

Keep reading to find out how the terms of your management contract will effect your, or your management companies decision to break off the relationship early.

Next: Contract Termination.

Back to Hiring a Property Management Company - The Complete Guide.

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Posted by Jordan Muela in Property Management Articles Make sure to read our introduction to this series on property management contracts. While contracts can range in size from 3-10 pages, 5-6 is average. Some are comprehensive, while others are very basic.

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This is a video based on the legal rights of Tenant and Landlord

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Insights In Law: Landlord and Tenants legal Rights

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The following video will help answer some of your questions about landlord and tenant law. When you rent a house or an apartment you enter into a legal contract, As a tenant you have certain rights and responsibilities. Insights In Michigan Law is a weekly video series to help those with legal questions during these challenging times.

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This is a video of tenants conference where the views of the tenants are heard and where they discuss on how to improve tenant lifestyle

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HUD Tenants Conference, Feb 29 1996 | Video | C-SPAN.org

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Committee members heard testimony from HUD officials and others concerning the investigation into an August 1995 tenant management conference in Puerto Rico on which the department spent $300,000....

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This is video of a landlord trying to prevent gun ban for public housing tenant

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By Scott Thistle, Sun Journal *

AUGUSTA, Maine - The plight of a disabled Rockland man who shot an alleged intruder in his apartment last August has prompted legislation that would prohibit gun bans in publicly subsidized housing.

Assistant Senate Majority Leader Andre Cushing, R-Hampden, said a bill he is sponsoring, LD 1572, An Act to Ensure Nondiscrimination Against Gun Owners in Public Housing, will at least start a conversation in the Legislature about the conflict between the rights of private property owners and those of tenants.

Cushing's bill is a response to an incident involving Harvey Lembo, who is now suing the owner and property management company of his Section 8 apartment.

Lembo, who uses a wheelchair, shot an alleged intruder in his home. He said he was defending himself after being robbed of his prescription medicines several times previously. But after the shooting, Lembo's landlord informed him tenants are prohibited from having firearms in the apartment building he has lived in since 1991.

"My feeling is when you have individuals who are in subsidized housing, in essence what you are looking at is housing of last resort for some people," Cushing said. "So they have a different position than a private-sector tenant who has discretion to perhaps move to an alternate location if their landlord doesn't allow smoking, pets, guns, parties - you know."

Cushing said landlords who accept public money for programs - such as the federally funded Section 8 voucher program - should not be allowed to squelch an individual's constitutional rights.

"This is an area where the landlord is receiving public monies to subsidize the rolls of their tenants and they are denying that person the right to have ownership either for hunting or personal protection," Cushing said.

According to reports in the Bangor Daily News, Lembo said he bought the gun about 12 hours before he was the victim of another burglary.

Cushing said Lembo had been robbed six times previously.

Cushing acknowledged too many rules for subsidized housing programs may cause some landlords to stop offering Section 8 housing to tenants. He said that was among the concerns he will consider as his legislation moves forward.

"It's a factor that we've got to weigh in the discussion, but we have not had a bill for some time where we actually discuss the rights related to people who have limited options," Cushing said. "I'm not looking to go to war with landlords or even public housing properties, but we need to have a discussion."

Lembo used a 7 mm Russian-made revolver to shoot 45-year-old Christopher Wildhaber of Rockland, who Lembo said had broken into his home to steal his medications. Wildhaber was shot in the shoulder and fled the residence before being apprehended by Rockland police in nearby woods.

Wildhaber, who was charged with burglary, theft of medication, attempted theft and three counts of refusing to submit to arrest, pleaded innocent to the charges in Knox County Unified Court in January.

His case is still pending, as is Lembo's civil suit against Park Place Associates of Rockland, the owner of his apartment, and its management company. Park Place Associates has asked the court to dismiss the suit.

Cushing said there's precedent in Maine law from a 1990s court decision involving the Portland Housing Authority that preserved the rights of those in subsidized housing to possess firearms - if they were not otherwise prohibited from possessing firearms under state and federal law.

Other lawmakers backing Cushing's bill include Sen. Eric Brakey, R-Auburn.

Brakey, who ushered through legislation in 2015 that allows adults in Maine to carry concealed handguns without a permit, said the legislation will be a balancing act between property rights and gun rights.

"I think when you have the case that you had [with Lembo] - an older gentleman who is simply defending himself, completely within his rights - and you have a landlord who receives taxpayer money for this housing situation [who] has voluntarily entered into this situation, and the landlord is denying this individual his constitutional right to defend himself, that's really troubling and very concerning," said Brakey.

Brakey said if landlords are not taking subsidies from the government, they should be allowed to prohibit guns on their properties if they choose to do so.

Brakey said Wednesday he would also support a change to state law to allow individuals to carry firearms at the State House if they are not otherwise prohibited from having a gun.

Cushing's bill will be heard at a public hearing of the Legislature's Criminal Justice and Public Safety Committee, which holds jurisdiction over most gun laws in Maine, likely in mid-February.

Sen. Stan Gerzofsky, D-Brunswick, who serves on the committee, declined to say whether he will back the measure.

Gerzofsky did say those who live in publicly subsidized housing are required to abide by certain standards or they risk losing their housing.

"So there are limits, based on conduct," Gerzofsky said. "But possessing a firearm for self-protection is something this committee will have to be able to talk openly about and figure it out. It's really important."

Gerzofsky also said landlords who accept state and federal funds to provide low-income housing also must abide by certain rules and laws, including those that protect tenants' rights.

Cushing said hearings and debate on the bill will help sort out all of the proposed legislation's pros and cons.

"I'm certainly worried we have adverse effects [from the bill], but I think it's an important debate to have just the same," he said.

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Maine bill aims to prevent gun bans for public housing tenants

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The plight of a disabled Rockland man who shot an alleged intruder in his apartment last August has prompted legislation that would prohibit gun bans in publicly subsidized housing.. Maine news, sports, politics, election results, and obituaries from the Bangor Daily News.

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This article contains the tenant obligations and rule under a landlord 

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This article contains the tenant obligations and rule under a landlord 

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Landlords are not the only ones who have to obey laws. Tenants also have certain obligations they must follow under landlord-tenant law. These obligations may differ slightly on a state by state basis, so you should always make sure your tenant knows what is expected of them in your location.

A tenant's main obligations are threefold:

1. Adhere to the Lease Agreement

2. Maintain the Premises

3. Allow the Landlord to Enter the Premises

Adhere to the Lease Agreement

When a tenant signs a lease to rent an apartment, he or she is agreeing to adhere to the terms of that agreement. Every lease is different. Some may only be one page long while others can be as much as twenty pages. As long as the lease terms are legal and not outlawed in the state or municipality where the rental is occurring, the tenant is required to follow them.

Some examples of common lease terms would include:

A tenant's failure to follow the terms of the lease he or she signed would be a breach of the lease. The landlord may be entitled to collect damages when a tenant breaches the lease.

Maintain the Premises

In addition to the other terms and obligations spelled out in the lease agreement, the tenant also has an obligation to maintain the premises.

The responsibilities include:

Following Buildings and Housing Codes- Tenants must abide by the sections of these codes that apply to tenants. These portions often focus on safety and health standards.

Keeping the Unit Safe and Sanitary- Tenants must keep their actually dwelling in a "reasonably" safe and clean condition. The unit does not have to be immaculate or free from clutter, it just must be free from safety hazards such as blocked fire escapes or sanitary hazards such as dog excrement.

Disposing of Garbage- Tenants have the responsibility of not allowing garbage, debris, and other waste to accumulate inside their apartments. Such waste must be disposed of in a clean and safe manner.

Maintaining Plumbing Fixtures- Tenants must do their best to keep all plumbing fixtures they use, such as the toilet or shower, in a clean condition.

Properly Operating All Plumbing and Electric Fixtures- Tenants are obligated to operate all electrical, plumbing, heating, cooling or other facilities according to their intended use. Doing so will minimize the risk of damage or sanitary or safety issues.

Maintaining Appliances Supplied by the Landlord- In the same vein, tenants are also responsible for taking the proper care of stoves, refrigerators, dishwashers, washers, dryers or any other appliances that have been supplied by the landlord. These appliances should only be used for their intended purposes and should be kept in a "reasonably" clean condition.

Not Damaging the Unit- It is the responsibility of the tenant to make sure he or she, any of their guests, or anyone they allow onto the property, does not damage the unit or any other part of the premises they have access to, including the common area, basement, or backyard. This includes deliberately damaging or destroying, damaging by neglect, or removing any part of the property.

Respecting Other Neighbors' Peace and Quiet- Tenants and any individuals they allow onto the premises have the obligation to conduct themselves in a way that will not be disruptive to their neighbors. This could include refraining from playing loud music or from allowing children to run and scream around the property.

Refraining from the Use of Illegal Drugs or Other Controlled Substances- Tenants or their guests must not use or distribute any controlled substances or other illegal or dangerous drugs on the premises. This could not only result in violating their lease agreement, it could also result in legal action being taken against them by the local government.

Not Tampering With Smoke or Carbon Monoxide Detectors- Tenants must never tamper with smoke or carbon monoxide detectors. This includes removing batteries, removing the detector completely, or damaging the detector.

Not Disturbing Paint in Homes Built Before 1978- Homes constructed before 1978 may contain lead-based paint and thus could also contain lead paint hazards. If it is a required condition in the lease agreement, tenants must notify their landlords before they paint or perform any actions or alterations that could disturb painted surfaces.

Preventing Mold Growth- Tenants must make an effort to prevent moisture accumulation in their unit that could lead to the growth of mold. This includes not allowing standing water. If the tenant notices any moisture accumulation, soft spots caused by water in walls or ceilings or any visible mold growth, they must immediately notify the landlord.

Allow the Landlord to Enter the Premises

Since a landlord is responsible for the premises, he or she has a right to enter the tenant's dwelling. There are certain rules which apply to both the landlord and the tenant.

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3 Main Responsibilities of Tenants Under Landlord Tenant Law

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Landlords are not the only ones who have to obey laws. Tenants also have certain obligations they must follow under landlord-tenant law. These obligations may differ slightly on a state by state basis, so you should always make sure your tenant knows what is expected of them in your location.

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This is an image of a tenant handing down a contract stating the rules of a tenant and a key 

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This is an image of a tenant handing down a contract stating the rules of a tenant and a key 

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This is an image of a tenant performing his responsibility 

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This is an image of a tenant performing his responsibility 

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This is a picture of a tenant and landlord discussing of their responsibility as both tenants and landlord

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This is a picture of a tenant and landlord discussing of their responsibility as both tenants and landlord

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These is a article based on the right and duty of a tenant

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When you rent a house or an apartment, you enter into a legal contract with someone. With this contract begins what is known as a landlord-tenant relationship. As a tenant, you have certain rights and responsibilities. First of all, you have the right of exclusive possession, which means that even though the landlord owns the property, you generally have the right to your privacy.

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These is a article based on the responsibilities of a tenant.

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When we rent an apartment, we have to respect a certain number of obligations: paying the rent, doing minor maintenance, respect for our neighbours... In exchange, the landlord also has certain responsibilities.

What are the basic responsibilities of tenants?

As a tenant, you have these responsibilities:

pay the rent mentioned in the lease on the date required by the lease

use the rental unit carefully and responsibly

make necessary minor repairs

to not change the form or destination (type of use) of your unit

when you move out, return the unit in the same condition as when you moved in

avoid disturbing the other tenants

When and how must tenants pay the rent?

Paying rent is an essential responsibility under the lease you signed with your landlord.

Unless you agreed to some other day in the lease, you must pay your rent on the first day of the month. If you pay it the next day, namely the second day of the month, you will be considered late in paying your rent. Your landlord could then apply to the Tribunal administratif du logement (TAL, formerly the Régie du logement or rental board) for an order requiring you to pay the amount owing.

If after three weeks, you have still not paid your rent, your landlord can apply to the TAL to have your lease cancelled. You can avoid cancellation by paying the landlord the rent owed, plus any interest owed, before the TAL hearing or at the time of the hearing, before the TAL issues its decision. Also, if you frequently pay your rent late and this causes the landlord serious hardship, the landlord can apply to cancel your lease.

To learn more, see our article Paying the Rent.

What does it mean to use my rental unit carefully and responsibly?

Because your right to live in your rental unit is temporary, under the lease you signed with the landlord, you must use it responsibly.

This is a general obligation and it covers the unit's accessories and all aspects of its use. This means that you must do the following:

Repair any damage due to deterioration. But if you can prove that the damage was not your fault, you won't have to repair the damage.

Notify the landlord of any defects or deterioration within a reasonable time so that the damage doesn't get worse. For example, if you don't notify your landlord of a major plumbing problem and the pipes burst because of your negligence, the landlord can claim all or part of the cost of the repairs from you.

As a tenant, do I have to do any work or make repairs?

You must do minor repairs and maintenance that don't involve much work. For example, you would be responsible for touching up paint and filling small holes in the walls. The TAL can tell you what would be a minor repair.

By law, you are required to give the unit back in the same condition you received it.

However, you are not responsible for normal wear and tear or for deterioration or defects that are not your fault. To avoid conflicts, when you move in, it's a good idea to take photos or prepare a document describing the condition of the unit.

Am I allowed to make changes in my rental unit?

Unless your lease allows it, you need the landlord's permission to make major changes to your rental unit. For example, you can't put up or tear down a wall to change how your unit is divided.

If you build anything in the unit on your own initiative, you will have to remove it when your lease ends. If they cannot be removed without damaging the apartment, the landlord can choose to keep them and pay you for their value. If it's simply impossible to remove them, the landlord will not have to pay you anything.

Can I turn my apartment into a commercial space?

This is usually not allowed for residential rental units. You can't turn your basement into a hairdressing salon or a ceramics studio. But you can do this if your landlord gives you permission and the zoning laws allow it.

What is the obligation to not disturb other tenants?

Under the law, you have an obligation to act reasonably and not disturb other tenants in the building. In other words, you must behave in a way that lets them peacefully enjoy their units.

The obligation also means that you can be held responsible for the actions of people living with you and anyone else you let into your unit. You could be sued for your - or their - behavior, and for any damages caused. The landlord could even apply to the TAL to cancel you lease. If the request is granted, you would have to leave your apartment.

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When we rent an apartment, we have to respect a certain number of obligations: paying the rent, doing minor maintenance, respect for our neighbours... In exchange, the landlord also has certain responsibilities. What are the basic responsibilities of tenants? As a tenant, you have these responsibilities: pay the rent mentioned in the lease on the [...]