Investing in rental properties is a common way to make money. You buy the properties and charge people to live there. It's a win-win.
But you must take steps to protect your investment. One way is by requiring security deposits from every tenant.
A security deposit gives you money you can keep if a tenant violates their lease. But do you know the rules of security deposits?
Continue reading this guide to learn some vital details about security deposits in Charlotte, NC.
Charge the Right Amount for Rental Properties
As a rental property owner, you must know landlord-tenant laws. There are also security deposit laws to know. You must know these laws to follow them.
The first is the amount of security deposit you can charge. The law in NC lets you charge up to two months of rent. This rule is for leases longer than month-to-month.
You can only charge 1 1/2 times the monthly rent for month-to-month leases.
Charging the maximum amount gives you more protection. You may want to conduct rental valuations on your properties occasionally. These help you select the best rental rates for all your units.
Use a Move-In Checklist
If you ask a property management firm for landlord advice, they'll suggest using a move-in checklist. You can provide this form to every tenant that moves in.
When a tenant moves in, walk through the rental property with the tenant. Ask the tenant to complete the form by noting the issues they see in the apartment.
Afterward, review the form and sign it. This form confirms an apartment's condition when the tenant moved into it. You can use it to prove damages when they move out.
Follow the Laws With Returning Security Deposits
One of the most critical things to learn is tenants rights with returning security deposits. The first thing to know is timing. You must return a security deposit within 30 days after the tenant vacates the unit.
Additionally, you must include a written form stating the reasons for withholding the security deposit. You can keep this money if you have valid reasons.
For example, you can keep the money if the tenant owes rent money. You can also keep it if the tenant damaged the apartment or left it dirty.
To protect yourself, inspect the unit as soon as the tenant moves out. Grab the move-in checklist to see the differences.
Finally, learn about the things you can't charge a tenant for. The most common thing is normal wear and tear.
Get Professional Property Management Help
Determining the right rent amount to charge for your rental properties is the best place to start. Then, you can base your security deposits on that.
Do you need help with this aspect of your rental property business? Look no further.
PMI Charlotte is a full-service property management firm. We specialize in excellent customer service and transparency. We can help you with security deposits and other aspects of running a rental property business.
Get in touch with us today to learn more.
