Nearly 43 percent of residents in Sacramento County rent their homes. Property managers know that managing rentals comes with a host of complexities as their tenants' lives change. One of those big life changes includes adding a tenant to an existing lease.
If you've never dealt with something like this, the process may seem daunting. Thankfully, we've demystified managing tenants for you. Read on to learn everything you need to know about adding a new tenant to a lease.
Why You Should Add a New Tenant to the Lease
It's natural that you'd want to make your current tenants happy and let them have their friend or partner move in without any paperwork. Unfortunately, doing that doesn't help you or your existing tenants in the long run.
Adding a tenant to an existing lease ensures that the new tenant is qualified to live in your property. It also assures that they're held to the terms of the lease agreement.
On top of that, it divides up the financial responsibility between the adult tenants. Your existing tenant may believe that their new roommate is financially responsible, but things do not always work out that way. This is a solid way of framing your reasoning to your tenant if they push back.
Application Process
Your new tenant needs to go through the application process, including a tenant background check, to make sure they're qualified to live in your property. The important part here is applying the same screening standards to the new tenant as you do all of your tenants.
Check their criminal history to ensure that they're safe and trustworthy. Ask for proof of income to demonstrate that they can afford to live there-generally, you want to see 3x the rent. Finally, run their credit to check for things like evictions, repossessions, and collections accounts.
Update Your Lease Agreements
Once you've determined that your new tenant is qualified to live there, you'll want to draft an updated lease with your new tenant listed. All occupants of the property need to sign the new lease agreeing to the new terms. That new lease stays in effect for the remainder of the lease term.
At the end of the lease, if all tenants are still upholding the terms of the lease, then you can proceed with developing the terms of the lease renewal.
Are You Worried about Adding a Tenant to an Existing Lease?
Adding a tenant to an existing lease might seem like an administrative burden, but it's actually a fantastic way to protect yourself and your property. Not only will you know that you have someone safe and qualified in your property, but they'll be subject to the lease contract, too.
Between administrative tasks, navigating California's rental laws, and routine repairs it can feel like there's simply not enough time in the day to stay on top of your rental. There are plenty of reasons why Folsom property owners should hire a property management company. Contact Residential Equity Management today to learn how we can help you!
