Choosing to Rent Out Your Home

Posted by Steve Minino on Monday, April 13th, 2015 at 1:35pm

In the current housing market, some people find it difficult to sell their homes. Downsizing to a house payment that is less than the amount that they are currently paying can be the only option for a homeowner whose home simply isn't selling. Rather than taking a significant loss on the value of their home, many sellers opt to rent out their home rather than sell it at a reduced price to buy themselves some time. This scenario isn't all that uncommon across the country. Many homeowners have become unwitting landlords, even if it's only until they can sell their home in a more favorable market.

Know the Local Rental Laws

Most homeowners would rather not become landlords, but if it's the only viable way to avoid taking a huge hit when they sell their home, many end up finding themselves in this situation. This can be a difficult and emotional time. For those who will become landlords for the first time, it is of the utmost importance to familiarize yourself with your local laws, and do some research into home renting in your area. You may want to plan ahead because there are sometimes delays and waiting periods that could end up disrupting your plans.

Choose the Right Rental Price

It can be a challenge to find the appropriate rental price if you aim to at least cover your monthly mortgage payments. At the end of the day, however, you'll have to take into consideration the current rental prices of similar homes in the area that you live. Also, consider that you will end up paying more for insurance if you turn your home into a rental property. It's best to contact your homeowners' insurance company to speak with them about rate increases.

Choose Your Tentants Carefully

It is absolutely necessary to perform due diligence when choosing your tenants. After all, you will have no choice but to put your trust in the people who you decide to rent your home out to. Some of the things that you can do on your own to gather information on your potential tenants include: contacting current employers, asking to view paycheck stubs, and phoning to check references of their previous landlords.

Because there is so much time and effort that can go into performing a thorough background check on renters, many would-be landlords opt to hire a tenant screening company to do the work for them. These companies will perform criminal background checks, eviction and credit checks. In the long-run it may be your best decision to hire a rental management company to look into the history of your potential tenants. It could end up saving you time, money and inevitably peace of mind.