For many tenants, property condition is a deciding factor when renting a home. If you’ve been renting for a while, you’re probably already in the habit of documenting any damages prior to move-in. But how often do you think about the carpet condition in your rented home or apartment? Probably not often (until it starts to look visibly dirty or worn) and you probably don't know anything about the Landlord Carpet Replacement Law.

Without proper cleaning and maintenance carpet can become a health-risk even before it begins to look dingy. Carpet can hold four times its weight in dirt and debris, which settles into the fibers and cannot be removed by dry vacuuming alone. Food, hair, skin cells, as well as debris, dragged in by pets or shoes can build up in the carpet, making it a perfect breeding ground for mold and dangerous bacteria.

Even if you are scrupulously clean, you will still have some level of build-up in your carpet. There’s also no guarantee that a property’s previous tenants shared your standards of cleanliness. Knowing your rights as a tenant and asking your prospective landlord a few questions before signing a lease, could spare you a few headaches down the line.

Property Condition Laws

Colorado has passed a number of rules and regulations governing the landlord-tenant relationship, which includes laws about property condition. The Colorado Warranty of Habitability, for example, was designed to protect tenants from unscrupulous landlords and requires rentals to be adequately waterproofed, have working heat, plumbing, and electricity, as well as proper sanitation. Under this warranty, the landlord is responsible for any necessary maintenance and upgrades to keep the property habitable.

Beyond the general requirement of habitability, which would ostensibly include properly maintained flooring, there are no state laws regulating carpet replacement or maintenance. As a result, landlords are only legally required to replace the carpeting in rental properties if it makes the house unlivable, such as in cases of mold or pests.

Under these laws, how frequently carpets should be replaced is left to the landlord’s discretion. When touring a rental, you may want to ask when the carpet was last replaced and when the landlord intends to install new carpets. With normal wear and tear, a carpet can last approximately 15 to 20 years, but the Department of Housing and Urban Development recommends replacing a rental property’s carpets every 5 to 7 years.

Your Options When it Comes to Rental Carpet Replacement

So what should you do if you’re touring a house or apartment with dingy carpets that have never been replaced? As a potential tenant, you have a few options—

  1. Don’t rent the property. If the landlord seems unconcerned with the carpet condition or is resistant to the idea of replacing it, keep searching. You should feel comfortable and safe in your rental home and not be worried about what might be lurking in the carpets.
  1. Attempt to negotiate with the landlord to have the carpet replaced. Consider offering to sign a longer lease or paying a slightly higher rental rate to cover the cost of the carpet. Most landlords are willing to make a few compromises if it means they can find a good, long-term tenant for their property.
  1. Live with the carpets as-is. Most debris and bacteria can be eliminated from your carpets with regular steam cleaning, which should be done at least once a year. Many landlords will have a property’s carpets cleaned between each tenant, which is another great question to ask during a property tour.

Depreciation and Damages

Landlord Carpet Replacement LawsAs a tenant, you may also bear some responsibility for replacing damaged carpets, which is why it’s important to document any potential issues before move-in. You do not want to be charged for damages that you did not cause and disputes over security deposits are common but avoidable. The deposit that you pay at the beginning of your lease will be used to make any necessary repairs when you move out, which could include cleaning or replacing carpets.

If your landlord decides to withhold part of your deposit, he or she must give you a written report explaining the deductions. Deposits can only be used to cover damages, not normal wear and tear. When it comes to carpet, wear and tear includes issues such as matting, dirt or wear in heavily trafficked areas, and impressions from furniture. Burns, stains, or tears in the carpet would be considered damages, and your deposit could be used to pay for cleaning or replacing the affected areas.

In most courts, the cost of replacing the carpet would be prorated over the course of five years, since that is considered the useful life of carpeting in a rental home.

In other words, if the carpet is already 3 years old when you moved into the house, you could not be charged the full cost for replacing a damaged carpet, since it was already halfway through its expected lifespan.

The method of carpet installation can also affect how the carpet depreciates. Since tacked-down carpet is easily removed, it is not considered “attached” to the property and would depreciate over the span of 5 years. Glued-down carpet is considered more permanent and would depreciate over 27.5 years like most other types of flooring.

Conclusion

Though you may not think of carpet condition as a deal-breaker in a rental property, take a moment consider the extent of damage or wear before committing to a lease.

Considering the amount of bacteria and dirt that can live in a carpet, negligence in cleaning and replacing the carpet could put you and your family at risk.

Asking for the carpet cleaning and replacement schedule during a tour is a great place to start and could help you and your landlord come to a better understanding of each other’s priorities and expectations.

If you are a landlord in Colorado, you should have a basic understanding of the Colorado Eviction Process and applicable Colorado Eviction Laws. Why? For a landlord, nothing derails your cash flow quicker than dealing with an eviction and it is important to know your rights and responsibilities.

You vetted the tenant –as carefully as possible. You pulled credit reports, did a background check, verified their job, and called their previous landlords to make sure everything checked out.

Colorado eviction processAt first, they may have been an ideal tenant; paying the rent on time, and rarely causing problems.

But somewhere along the way, something changed and a tenant that was once considered qualified –is no longer abiding by the terms of the lease.

In most cases, this violation comes in the form of late rent. Maybe they’re having trouble paying due to a job loss that results in a sudden loss of income, or income being cut in half due to a divorce. Other times, lease violations involve a tenant moving a new roommate in, without seeking permission first; or even adopting an undisclosed pet or two, and bringing them into your ‘no pets’ rental. Sometimes, there may be more serious issues involved; such as drug-related activity or criminal activity.

The fact is that even the most carefully vetted tenant, can sometimes slip through the cracks. And things come up that can transform even the most ideal renter into one who’s in violation of the lease.

No matter what the issue is, for landlords, it’s extremely important to ensure that you take action as soon as possible, to help prevent the problem from compounding or getting worse. Once a tenant falls too far behind on the rent, it can be all but impossible for them to get caught up. It may seem like an insignificant detail, but for many landlords who depend on rental income, a tenant who falls one month –or longer behind on the rent, can represent a serious loss.

For tenants who may be violating the lease in other ways, such as moving pets in without permission, taking action to address the issue sends the message that you care about your rental, and expect all of the residents to abide by the rules. Letting things “just slide” for too long can lead to complacency and the start of a downward spiral.

If you’ve reached the point of no return, where a tenant who is in violation of the lease isn’t complying with your warnings, the next step is usually to begin the eviction proceedings.

Notice for Termination With Cause

For a landlord to evict a tenant in Colorado before the tenant’s rental term has expired, they must have legal cause. The Colorado Eviction laws defines legal cause as:

  • Failing to pay rent
  • Violating the lease
  • Committing a serious act, such as a crime

The first step in the Colorado Eviction Process involves giving the tenant a 3-day notice. This notice states your intention to evict the tenant and informs them that they have three days to fix the lease violation or vacate the property.

The procedure for the 3-day notice is something we discussed in detail in our previous article.

Once they’ve received the 3-day notice, the tenant usually has two options:

  1. To pay rent, or remedy or, ‘cure’ the violation, or
  2. Move out.

The tenant has three days to correct the problem or move, and if they fail to do so, then you may begin the eviction procedures through the court. This process can be initiated on the 4th day after the tenant receives the notice.

The Formal Colorado Eviction Process

According to the Colorado Eviction Laws, if the 3-day notice doesn’t result in the tenant paying the rent, or ‘curing’ the violation –or moving out, you can then proceed with the formal Colorado eviction process.

This involves filling out a few forms including JDF 99, or, Complaint in Forcible Entry and Detainer, plus a CRCCP Form 1A –Summons in Forcible Entry and Unlawful Detainer, and a CRCCP Form 3 –Answer Under Simplified Civil Procedure.

Once you’ve filed the complaint with the court, you have one day to mail a copy of all of the forms to the tenants. Do this via first class mail with prepaid postage.

Next, the court clerk will schedule a hearing. This is usually between 7 and 14 days from the date that the summons is issued. However, the tenants must be given at least 7 days between the date they are formally served and the court date itself.

The summons can be issued by the sheriff’s department or a private process server –or by another adult who isn’t involved in the eviction. If the tenants cannot be served in person, the papers can be posted on the door of the rental.

After the tenants have been served, they must show up in court, or file a counterclaim to the allegations in your complaint. If you’ve filed everything correctly and the tenants do not make a counterclaim, you may receive a summary judgment in your favor.

If the Tenant Contests the Eviction

If they feel they have legal grounds, a tenant may try to contest the eviction. They could do this by filing an answer on or before the time set by the court.

Some common legal defenses that a tenant may use include claims that you failed to maintain the rental unit, or that you are retaliating against them. Fighting an eviction could increase the amount of time that the tenant is able to stay at the rental property.

If the tenant files an answer with the Justice Court, then a hearing will be scheduled. A notice of the hearing date will be mailed to all parties.

However, if the tenant fails to answer or appear on the date indicated in the eviction papers, you can obtain an eviction “Order” by default.

If the Tenant Does Not Contest the Eviction

If the judge makes a decision in your favor, you can then file for possession of the property. To do this, you’ll want to complete the Motion for Entry of Judgment (JDF 104). After reviewing it, the court will give you a signed copy of the Order for Entry of Judgment (JDF 107).

Next, the countdown begins. The tenant will have 48 hours from the date of the judgment to vacate the unit. If they don’t, then you can then complete the Writ of Restitution (JDF 103) and present it to the court.

Once the judge approves it, they’ll contact the sheriff’s department to execute it; that is, to remove the tenant.

Removal of the Tenant: What Happens if a Tenant Refuses to Leave?

If the tenant hasn’t vacated the premises, then the actual eviction will take place.

You’ll receive a time and date from the court or sheriff’s department, stating when they will arrive to execute the writ.

You can then arrange to have the tenant’s personal property removed from the rental at the date and time that you received from the court. This is generally done with the help of a local moving company. You will have one hour to remove the tenant's belongings, so make sure you will have enough manpower available to remove everything during this time.

On the day of the eviction, the sheriff will serve the Order to the tenant and then will remain on site.

In some jurisdictions, such as El Paso County, the Sheriff will generally “Pre-Serve” the tenant by posting a notice letting the tenant know they will be back to take possession. This is done to encourage the tenant to leave instead of waiting for the eviction itself to take place.

Keep in mind that the only person who is authorized to remove a tenant from the rental unit is a law enforcement officer. A landlord must never try to force the tenant out of the unit. If you attempt to do this yourself, the tenant could take legal action against you.

Neither the sheriff nor the landlord has any responsibility to safeguard the tenant’s property once it is removed. If you find that a tenant has left behind personal belongings, you aren’t required to contact the tenant before disposing of them. However, if you do decide to store them for the tenant, you can charge storage.

After the Eviction

Once the tenant has been evicted; the landlord or property manager can take steps to get the property ready to rent again.

In most cases, the first step is getting the property re-keyed.

At this point, the cleaning and repairs can commence as well. This involves a walk-through inspection of the unit, taking note of any damage that the tenant caused.

You also process the security deposit that you obtained from the tenant when they first moved in. If there is any back rent owed or damage to the rental, you can apply the security deposit to this, and send the remainder to the tenant. Keep in mind that general wear and tear is not the tenant’s responsibility, and cannot be taken out of their security deposit.

If additional back rent or money is still owed, even after the security deposit has been applied, you can start the process of seeking this as well.

While evictions can be a stressful and often-confusing time, it’s important for landlords to ensure that they follow the law to the letter. Complying with the law will help the eviction proceedings to go much more smoothly. If you were to attempt to take the law into your own hands at any point, or neglect to send out the right form, a tenant could have a reason to contest the eviction, and the judge could end up throwing your case out. In this case, you may have to start the proceedings again.

Evictions are never pleasant but they do get easier over time. Once you have a clear understanding of the Colorado Eviction Laws and the Colorado Eviction Process, it’ll be a lot easier to navigate the process and ensure that you do so in a way that’s in compliance with the law.

If you’re not sure where to start, you could always consult with an experienced attorney, to make sure you’re clear on the Colorado Eviction Laws, the Colorado Eviction Process, what’s required of you as a landlord or tenant, and what steps you should take.

Note: The information in this article is intended to inform and educate, it should not be taken as a substitute for legal counsel. If you have any questions about the eviction process or your rights as a landlord please contact an attorney.

Is Renting a Townhouse Right for You?

If you have lived in Colorado Springs for a few years, it may come as no surprise that the average cost of rent has risen 27.41% since 2015. But is renting a townhouse the right housing option for you?

Though a booming job and housing market offers certain benefits to the Colorado Springs community, the increase in housing costs makes renting a single-family home less realistic for many, including young professionals and single-income households.

As you examine your budget and weigh housing options, you may find yourself wondering if a townhouse or condo is a better option for your lifestyle and financial situation.

On average, renting a townhouse is 16-17% less expensive than renting a single-family home, while offering some of the same amenities. townhouses do require some sacrifices in terms of autonomy and privacy, however, so make sure it is a good fit for you before signing a lease

Why Consider a Townhouse?

In addition to their affordability, townhouses require less upkeep than a traditional single-family home. If you dread lawn maintenance and repainting your home’s exterior every 5-10 years, buying or renting a townhouse may be a great investment.

The HOA in these communities are responsible for all exterior maintenance, including snow removal in the winter. Shoveling your driveway and walk after a Colorado snowstorm is essential for avoiding slick and hazardous surfaces, but it can also be a chilly and physically taxing chore.

Townhouses also offer advantages over a traditional apartment unit or condo. Though not as private as a single-family home, townhouses typically have private entrances, eliminating the shared hallways of an apartment complex.

Most townhouses are narrow two-story structures, meaning that you would have neighbors on either side of you, but none above or below. This layout decreases the likelihood that you will hear your neighbors through shared walls and vice versa.

In most communities, each townhouse has its own in-unit laundry, rather than the communal laundry areas popular in apartment complexes. This feature, in addition to the small private yards that exist in most townhouse communities, results in a more house-like feel than most multi-family structures. For a more detailed comparison of apartments or condos and townhouses, read “Condos vs. Townhouses—What’s the difference?”

Despite the more private nature of a townhouse, you will still be living in relatively close proximity to your neighbors and utilizing many of the same common areas, so it may be worth thinking about whether you would enjoy the social element of a townhouse community.

If you prefer to keep to yourself and can afford a single-family home, that may be a better option.

Townhouse Rules and Regulations 

Living in a townhouse does require adhering to the covenants and by-laws of that community which are enforced by the HOA. These rules vary greatly from community to community, but may include noise restrictions, rules about parking, and regulations regarding the external appearance of the townhouse.

Though these rules are designed to preserve the appearance and desirability of the community, some individuals may find the covenants restrictive.

If you are considering renting in a particular community, ask the landlord, previous tenant, or the HOA for a copy of the community’s governing documents.

Noise

Many HOAs enforce quiet hours at night, and some may also have ordinances regarding acceptable noise levels during the day.

Parking

Though you may have a one-car garage attached to your townhouse, many communities use carports or street parking. Parking regulations will determine where you can park and what types of vehicles are allowed. The HOA may also enforce a parking lot speed limit.

Pets

In addition to leash laws and restrictions on the number of pets per unit, HOAs often enforce breed or weight restrictions. The most common restrictions are placed on dogs over 50 pounds or “potentially dangerous” breeds, such as Pit Bull or Staffordshire Terriers, Dobermans, Rottweilers, and German Shepherds.

External Appearance

Other common rules deal with uniformity within the community. The HOA may have regulations regarding size and type of holiday decorations, as well as deadlines for removing the decorations. They may also prohibit landscaping or gardening in the front yard.

The Townhouse HOA

When you lease in an HOA community, you assume the owner’s responsibility for adhering to the community’s regulations. Most leases will pass the penalties for violations onto the tenant.

The only exception being if the owner (rather than the tenant) was responsible for the violation. These penalties typically include warnings or fines, but multiple violations can result in eviction for violating the terms of the lease, so make sure that you are willing to abide by the rules of the community before buying or renting.

Though an HOA fee may seem like an additional unnecessary expenditure, it covers several of the bills that you would normally be responsible for, such as trash removal, exterior maintenance (discussed earlier), and insurance coverage for the building’s exterior.

Your HOA fees may cover additional amenities, such as a community clubhouse, pool, or gym, potentially saving you money on a gym membership or fitness subscription in addition to offering more opportunities to build community with your neighbors.

How to Begin Your Search

If you are an avid gardener, value seclusion, or like the freedom to leave your Christmas lights up through March, a townhouse may not be right for you. For the right individual or family, however, these inconveniences are made up for by the affordability, community, and lack of exterior maintenance townhouses offer.

If the amenities and lifestyle of townhouse living appeal to you, check out our townhouse listings online. Before signing your lease, remember to talk to prospective neighbors and check out the community’s governing documents to make sure it is a good fit for you. Springs Homes would love to help you find the perfect community, so please contact us if you have any questions or want to schedule a showing.

The end of a lease is an important event for landlords and tenants alike. It can also be a time of conflicting expectations. Both tenant and landlord need to understand the difference between normal wear and tear versus damage.

The landlord will usually expect their property to be returned to them in the exact condition that it was in when the tenants moved in –and if this doesn’t happen, are often happy to use the tenant’s security deposit to make it this way. Tenants, on the other hand, more often than not will expect their full security deposit back, even if there has been some damage to the rental.

Normal Wear and Team vs DamageIn order to help manage expectations, and make the move-out process as simple and straightforward as possible, it’s important for both landlords and tenants to be on the same page. This includes having a good understanding of security deposits, and what they can and cannot be used for.

At the Time of Move-Out

At the time of move-out, the landlord or property manager is responsible for repairing any damages to the property, as well as assessing and documenting normal wear and tear. A good Property Manager will have a move-out routine that includes items like:

  • Making sure the property is clean
  • Replace all furnace filters
  • Check smoke and CO detectors are in good working order
  • Replace burnt-out lightbulbs
  • etc...

They’re also responsible for deciding who will pay for any repairs, maintenance, and cleaning that’s required to bring the property back into rentable condition.

This is the part of the process that’s often full of contention. When it comes to assessing damages, the landlord’s job is to assess the property and determine what falls under the category of damages, and what should be considered simply normal wear and tear. While damages are the tenant’s responsibility, things that fall under the category of normal wear, should not be taken out of the security deposit.

It's important that landlords not use the security deposit to pay for things that go above and beyond the scope of normal wear. They may attempt to use it for things like worn carpeting or faded paint on the walls, things that aren’t damages, but instead are just the result of normal usage. In most cases, landlords know to use the security deposit as intended, to repair damages to the property, only for the tenant to contest this, and seek to get it back. One important exception to this rule pertains to items spelled out in the lease. Examples might be cleaning or carpet cleaning. If these items are stipulated as tenant responsibility in the lease, the landlord is within their rights to use security deposit funds to pay for them, if the tenant left these items undone.

When it comes to repairs, though, the law stipulates that the security deposit should only be used for repairs to damage that goes beyond what’s considered to be ordinary wear and tear.

Colorado Law (C.R.S. 38-12-102) defines “normal wear and tear as “Deterioration which occurs, based upon the use for which the rental unit is intended, without negligence, carelessness, accident, or abuse of the premises or equipment or chattels by the tenant or members of his household, or their invitees or guests.”

That’s a bit confusing for landlords and tenants alike. To help clear things up, here’s a list of examples of both normal wear and tear and damage.

Normal Wear and Tear vs. Damage

Normal Wear and TearDamage
Worn out CarpetTorn, Stained or Burned Carpet
Faded Window CoveringsTorn, Mutilated or Missing Window Coverings
Worn out KeysLost or Missing Keys
Dirty WallsHoles in Walls
Dirty WindowsBroken Windows

When determining costs, the landlord will also make decisions about repairing versus actual replacement. In some cases, repair is the best choice. A good example of this would be a recent experience we had. A tenant had backed a car into the side of a home damaging a section of masonite siding. The siding was already in rough shape and the product was failing and the particular pattern was no longer available. The owner was planning to reclad the home in stucco in a couple of years anyway, so we just applied a patch using every the favorite body putty of every motorhead, "Bondo".

Wear and Tear

This repair worked out well because the owner already had a plan in place for new exterior stucco and was willing to kick the can down the road. Had this not been the case, the repair could have cost the tenant a lot more money. It’s important to note that in some cases, a landlord may charge replacement cost for an item that could be repaired with a short-term fix. So, for example, suppose a tenant punches a large hole in a wall. The landlord may choose to repair it in the short-term by simply patching it. While this temporary fix is fine for the short-term, the underlying fact is the wallboard is not the same, and the owner may choose to go back at some point and replace the entire wallboard so they are within their rights to charge for replacement.

Calculating Repairs Cost

If the item can be repaired, though, in most cases the landlord will choose to go that route. In this case, the landlord will deduct for labor, materials, and travel.

  • Calculating Average Repair Costs-It’s also important for the landlord to determine material and labor costs based off of averages. This will help to avoid conflicts, and in the event of litigation, the courts will also require a list of repairs, and having average costs will make it easier to prove your case.
  • Factoring in Depreciation-Depreciation also factors into how much the tenant ends up being charged for damages. Depreciation takes into account the fact that things have a life expectancy. This includes carpet, appliances, paint, tile, and more. This life expectancy needs to be factored into the cost of repairs or replacement.

For example: if a five-year-old carpet is destroyed and that particular type of carpeting had a 10-year life expectancy, the landlord may only charge the tenant 50% of the replacement cost. This is a good practice, and extremely important as it helps to prevent landlords from using deposit funds in order to upgrade their properties.

Here is a Sample Life Expectancy Chart:

Water Heater10 Years
Carpeting (builder grade)5 Years
Air Conditioning Units7 Years
Ranges20 Years
Refrigerators10 Years
Interior Paint-Enamel5 Years
Interior Paint-Flat3 Years
Linoleum Tile5 Years
Window Coverings (shades, screens & blinds)3 Years

These are estimates are produced by HUD. Manufacturer estimates will vary.

Assessing the Condition of the Property

Assessing the condition of the property is the responsibility of the landlord or property manager.

This will allow the landlord to determine whether there are any damages that are the tenant’s responsibility, and therefore should be paid for out of the security deposit. It also allows them to set the condition baseline before a new tenant moves in.

The challenge is determining and documenting the condition of the property before the damage occurred. This is important in the event that the tenant disputes the damages, or if the case goes to court, as having proof that the affected or damaged area was in good condition before will generally resolve the issue.

Documentation Methods Include:

  • Written Reports: Written reports are an old method, but one that’s still in use today. With a written report, the landlord or property manager does a walk-through of the property and takes notes on its condition. Relying solely on written reports isn’t the best option, since it can be subjective, and doesn’t really provide much proof of the condition one way or the other. In most cases, property managers and landlords would be better served by using another form of documentation in addition to, or instead of a written report.
  • Apps: Some landlords prefer to use an app that prompts them for pictures and notes. Although this certainly is a step above the old-fashioned written report, in that it makes it easy to capture images and notes to go along with your report, in some cases, they just aren’t thorough enough.
  • Video: Video footage is an especially good method of documentation. To capture video footage, the landlord or property manager will perform a walk-through inspection of the home with a video recorder or phone, compiling a detailed video of the condition of the unit. However, this method can be problematic. When it comes to finding the affected item in question, having video footage means that the landlord will have to fast forward and rewind through quite a bit of footage. This can be time-consuming and uncomfortable in court. Just imagine fast forwarding and rewinding while the judge waits! Of course, you could capture image stills before you go to court, but again, this could be a time-consuming process.
  • Pictures: Taking photos is one of the best ways to document the condition of a property. And it’s especially affordable since the advent of digital photography and affordable storage options. You can take hundreds of pictures of a property and if there's damage, it's fairly easy to go back and find the photograph that references the newly-damaged area. If you choose this method, just make sure you use your digital camera’s time and date stamp feature.
  • 3D Imagery: Another new method for documenting the condition of a property, using 3D photography like the Matterport 3D camera allows landlords to do realistic virtual walkthroughs on properties. Since the footage is stored in the cloud, you can use the mouse to walk right up to the area that’s damaged and check to see what the condition was prior to their move-in. You can also take additional pictures inside cabinets, closets, and other places the camera can't see. A secondary benefit from these tours is showing prospective tenants –especially out-of-state applicants, the property before they agree to lease it.

Tenant Should Protect Themselves

Of course, there’s a lot that tenants can do to help ensure that they’ll get their deposit back at the end of their lease.

First, of course, tenants should ensure that they keep the property in good condition while they live there, and avoid anything that might cause damage to it.

Secondly, if a tenant would like to contest the landlord’s decision to apply the security deposit to damage, they can do so. The best way to do this is by being able to furnish proof of the condition of the property. In most cases, tenants should consider taking their own photos. Generally speaking, the more documentation, the better. Photos that are taken at the time of move-in could provide proof of the condition of the property, and images that are obtained, say; a month into the lease could be used as proof of damage caused by movers. It’s also a good idea to use a camera with a time and date stamp feature and to show any pictures of post-move-in damage to the landlord.

It’s also worth noting that if a landlord fails to follow Colorado security deposit laws, the tenant could be awarded up to three times the amount that was wrongfully withheld, plus attorney’s fees and court costs, so it’s important for landlords to ensure that they remain in compliance with the law, and handle the security deposit properly.

Being Clear on the Terms of the Lease

For tenants, it’s important to remember that normal wear and tear versus damage are broad definitions, and much of the detail about the condition that you’re required to leave the property in at move-out will be specified out in your lease.

It’s important to read the lease before signing it and to make sure you ask questions to ensure that you’re clear on what’s expected of you. For instance, in some cases a landlord may state that the carpets are to be professionally cleaned at the time of move-out, others will require you to perform regular, outdoor grounds keeping maintenance, so make sure you fully understand your responsibilities and requirements before you move in.

Successful and straightforward move-outs are always the result of good documentation and communication, from both parties. It’s important for landlords to spell out their expectations in the lease document, and for tenants to ensure that they’ve read the lease –and are clear on their responsibilities both in terms of maintenance, and the condition that they’re expected to leave the property in at the time of move-out.

 Additional Resources:

It all starts with being "Move-In Ready"

Rental Security Deposit disputes usually occur because of a misunderstanding between a landlord and a tenant. At the end of a lease term, the tenant is usually required to leave the property in “move-in ready” condition. This means the same condition in which they received the property, minus any normal wear and tear.

Since normal wear and tear are well defined, most landlords or property managers should have a strong grasp on what constitutes damage vs normal wear and tear.

At the end of the lease term, usually, after one to three years, the landlord inspects the property. This move-out inspection determines if the property is "Move-in ready" for the next tenant.

If the property needs cleaning or repairs to be move-in ready, those costs are paid from the previous tenant's security deposit.

Landlord Rights and Responsibilities

Each individual state regulates its own landlord, tenant laws. In spite of this, most state laws are very similar. Most states allow deductions from security deposit funds for the following:

  • Unpaid rents
  • Cleaning to return the property to move-in condition
  • Repair for any damages that are not normal wear and tear
  • Repair or replacement of personal property, things like keys, appliances, furniture or televisions.

When using security deposit funds, the landlord is responsible for:

  • Providing the tenant with an itemized breakdown of costs for deducted items.
  • These charges must be reasonable and within industry standards.

Inappropriate use of security deposit funds can cause problems for the landlord. When security deposit disputes go to small claims court the guidelines are clear. The landlord can incur penalties for failing to adhere to the appropriate guidelines.

Avoiding Small Claims Court

Because of the dollar amounts involved, security deposit disputes that cannot be resolved without the help of a judge end up in small claims court.

The small claims process is very straight forward, the Judge looks at the following:

  • State Law
  • The Lease Agreement
  • Evidence:
    • Documentation of Condition before and after (photos, videos, etc…)
    • Receipts
  • Any other pertinent documentation

The rules about security deposits are clear so disputes are usually about what "move-in" condition is. The responsibility falls to the landlord to document the condition of the property prior to any new tenant moving in. 

Problems occur for the landlord if they fail to adequately document the condition of the property. In these cases, it becomes about the landlord's word against the tenant's word and the courts can be more sympathetic to the public. 

When a landlord fails to appropriately document the condition of a property, it speaks volumes about how they do business. There are instances when the damage to a property occurs someplace so obscure the landlord could not have been expected to document that area. This is, of course, the exception, not the rule.

Proper documentation of the property and open communication with the tenant are the best way to avoid small claims court.

Documenting Rental Property Condition

There are a number of methods available to facilitate the effective documentation of a property. Digital imaging and cloud storage have made it very simple to record and share any media or reports.

Photos are a great way to document property condition. Digital storage is cheap and photo-documenting a property is easy. Sharing photos with the tenants enables them to check out the original property condition. Just being able to see move-in photos goes a long way to heading off any potential condition disputes.

Another advantage to photographs is that in the event you end up in court, you can print before and after pictures. This saves time in court and shows that you've done the proper documentation.

Video has become another popular method of documenting the condition of a rental property. Lightweight high-quality cameras make this an attractive option for landlords and property managers. One advantage of video is that the person shooting the video can also comment about what they are seeing. This avoids having to make notes or guess about what the photo is about.

Like photographs, videos are easy to store and share. Videos can be more difficult to deal with in a courtroom setting. Patience can run thin while fast-forwarding or rewinding as you look for something specific. Higher quality cameras allow you to take good quality still photos from video clips. We recommend this if you need to go to court.

Virtual tours have become very sophisticated over the last five years. Matterport is a 360-degree camera that produces so pretty awesome virtual walkthroughs. This is a great way to share the current condition with the owner as well as creating a record for the tenant time of move out.

In the event we need to go to court, these virtual tours allow us to zoom into an area and take a very high-quality still photo. Our Colorado Springs Property Management company uses this method and it's working great.

Reports are another effective way of documenting the condition of a property. Popular property management software usually comes with some type of reporting module. These modules usually come in the form of an app for a mobile device. The landlord walks through the property and takes photos of any issues. These apps have a place to write comments as well.

We have used these apps in the past and they produce a really attractive report. The only problem we have found is that they only capture current problems. We have found that it's best to have a comprehensive snapshot of the entire property. This way if a problem arises, we have documentation of how the area looked.

How to Avoid Security Deposit Disputes

Security Deposit Disputes and How to Avoid Them

A little transparency, communication, and participation can also go a long way in reducing security deposit disputes. Move outs are easier when both tenant and landlord are on the same page. One way to accomplish this is to get participation from the tenants right at the beginning of the lease period.

It's a good idea to get the tenants involved in documenting the condition of the property right from the beginning. We like to give out tenants the opportunity to take pictures of any damage or dirt they find prior to any big furniture or appliances being moved in. If you have set up a file for move-in documentation, these tenant photos can be incorporated.

Obviously, there needs to be a reasonable deadline for these types of discoveries. But, we have found that this one simple action has really helped reduce our security deposit disputes.

Another effective action is to perform a pre move out inspection walkthrough. This is an informal walkthrough where the landlord can point out or make a list of any items that might be an issue. 

This gives the tenant heads up and allows them the opportunity to make the item right before they move out. If they choose not to repair or clean something found on this walkthrough we always interpret that it's something they're willing to have taken out of their deposit. This pre-inspection walkthrough gives them a clear picture of what's going to happen so they don't feel blindsided. 

Another good way to avoid any misunderstanding about expectations at move out time is to provide the tenant with a cleaning checklist. In most cases, a general checklist works well. If the property is really unique the landlord may need to provide more detailed instructions for the tenants.

Unexpected surprises are the primary cause of disputes over security deposits. Transparency and communication help eliminate surprises. While the tenant may not appreciate the deduction, knowing that it’s coming and why it’s coming goes a long in avoiding a trip to small claims court.

What is Renters Insurance?

Renter's Insurance

Renters insurance is a type of policy that is designed to cover the tenants and their belongings in a rented residence. While landlords have their own policies that cover their structures and financial interests, these policies don’t generally extend coverage to their tenant's personal property.

This means that if a tenant’s property is damaged or stolen, a landlord's insurance is not likely to cover the cost of replacing those items.

Most renters don’t think about protecting their belongings, much less their potential liabilities as a tenant. In many cases, tenants will look to their landlord for compensation of damaged destroyed or stolen items.

If the landlord is responsible for losses due to negligence, the tenant may have a case but this is the exception, not the rule. In most cases, the responsibility for their belongings falls to the tenant.

This is why many landlords require tenants to have renters insurance before occupying a property. They do this to avoid disagreements that may arise as a result of theft or damage.

A renter's policy also helps protect the landlord in case the renters or guests get injured on the property.

How Does Renters’ Insurance Work?

How Does Renters Insurance Work?

This type of insurance works just like most insurance policies. The purchaser chooses a coverage level which in turn determines the cost of the renter's monthly premiums.

In the event that anything happens to the tenant or their belongings, such as fire, theft, or other types of damage, the tenant simply files a claim with the insurance provider.

The insurance provider will then pay the amount that’s equivalent to what’s covered by the policy after paying any deductible.

Apart from covering your property, renters insurance can also cover other types of disasters.

For example, let’s say someone falls on your stairs and sues you for the medical bills, renters insurance can cover it. If you have to move out of your house after a fire tragedy, most policies will take care of the cost of living in a hotel room as well.

However, it’s important to go through your renter's policy and coverage and identify its strengths and weaknesses. The elements covered by policies differ, and maybe less detailed if you choose a relatively low premium.

What Does Renters Insurance Cover?

Renters insurance primarily covers tenant's belongings in the event of damage or destruction. But keep in mind that the policy doesn’t cover for every type of damage or accident. Renters insurance coverage typically has four types of coverage. These are;

  • Personal Property Damage or Loss: In the event that your personal property gets damaged in an event named in your policy, your renters insurance policy will cover the cost of those damages equivalent to your policy’s limits. Examples of covered perils include fires, theft, or wind.
How Does Renters’ Insurance Work?
  • Personal liabilities: In case a visitor gets injured while on your premises or their property is damaged, and you are responsible for the damages, renters insurance can cover all the liability costs. This includes the cost of hiring your lawyer, for as long as it doesn’t exceed the maximum liability coverage.
  • Additional Living Expenses: If a covered aspect makes your rental apartment or home uninhabitable, your renters insurance policy will cover all the expenses incurred after interrupting your normal living expenses. This is referred to as loss of use coverage.
  • Medical Payments: Renters insurance also offers limited coverage for any medical costs in the event that a guest gets injured on your property.

These are the common types of coverage that renters insurance provides to tenants. Some Renters insurance policies may even cover your belongings when you’re traveling.

As much as this insurance policy protects you against unexpected events, it’s still important to realize the type of scenarios that are not covered by this type of insurance.

What’s not covered by Renters Insurance?

Renters insurance coverage won’t protect you from everything. Most service providers don’t cover damages caused by natural calamities, events related to dangerous dog breeds, among many others. Here are some things that aren’t covered.

  • Property Damage- Most of the renters insurance companies will not cover damages caused to the property itself. The landlord's policy generally takes care of the property itself.
  • Damage caused by Pests- Most renters insurance policies don’t cover damage costs caused by bed bugs, ants, and rodents. These are classified as a maintenance issue and failure to provide ongoing maintenance doesn't meet the standard for coverage. It's important to note that most residential leases leave the tenant responsible for pest remediation. The exception to this is in the event the pests at the property prior to moving in. 
  • Flood and Earthquake Damages- Earthquake and flood damages are also not covered by a renters policy, especially in areas prone to these natural disasters. Nevertheless, some companies offer coverage of these disasters at premium rates.
  • Car Damages or Theft- If you have a car, its theft or damage won’t be covered by your renters policy. You’ll need a car insurance policy that offers comprehensive coverage. However, renters insurance will cover the belongings that were inside your car when it was stolen.
  • Roommates- A renters insurance policy doesn’t cover damages to your roommate’s belongings. If you want them covered, you should include the items in your insurance policy.

How Much Does It Cost?

Fortunately, a tenant's insurance policy isn’t that expensive, these policies can cost you as little as $10 to $20 a month and about $200 to $250 per year. This is a fraction of the replacement cost for the average renter's belongings. It just makes sense to obtain this type of insurance even if it's not required.

The price of your policy is determined by the type of policy you need. Individuals who own expensive and sophisticated gadgets will pay more than those who’ve simple and less expensive items.

Do You Need Renters Insurance?

It’s all up to you to decide whether you need renters insurance or not. If you’re finding it hard to make this decision, start by evaluating your personal finances and your possessions. If you live in a small studio apartment with simple furnishings, and you’re sure that you can replace them from your pocket without any struggles, you may not want renters insurance.

On the flip side, if you own more household items that you can’t afford to replace at once, a renters policy will benefit you.

Start by going through all the rooms in your house and make a list of the items and how much they will cost to replace them.

Don’t forget to include the smaller items, i.e., dishes, books, clothes, even pots ,and pans. Now, sum up the total and if the total amount exceeds the amount you can afford to replace your inventory, you should consider getting a quote for a renters insurance policy.

How Can I Get Renters Insurance?

Obtaining a renters insurance policy is very easy; in fact, you’ll wonder why you haven’t already done it. After you’ve taken stock of all your belongings, find out what’s covered by your landlord’s insurance and note down everything that isn’t covered. 

You can then start researching different insurance companies online and make comparisons before choosing. Most insurance companies offer free quotes online, over the phone, or even in person. You can contact them, and they’ll take you through the best insurance coverage plan for your situation.

Other Considerations When Purchasing a Tenants Insurance?

Once you’ve decided that you need renters insurance, there are several things to consider before purchasing this type of insurance policy. They include:

  • Price and Coverage: Insurance companies will give you a fixed amount for all your belongings, and not on separate items. The higher the amount, the more you’ll pay for your insurance.
  • Deductible: It’s also good to consider how much you’ll be required to pay before your insurance kicks in. Remember, higher premium means a lower deductible and vice-versa. 
  • Replacement Cost vs. Actual Cash Value- A policy will either pay you for the replacement of a similar item or pay you with ACV. ACV represents the value of the property when it was damaged. Although replacement premiums cost more, they’re worth every penny.
  • Previous Claims in your Location: If you live in an area that sees a lot of claims, you’ll probably pay more for your renters insurance. If you or your neighbors have had lots of claims, this may also impact the price of your policy.

Final Thoughts

  • Even if you feel that your personal property isn’t worth an insurance policy, simply having the liability coverage is worth the cost. 
  • Most importantly, ensure that you’re not paying for the coverage you don’t need. See what’s covered by your landlord’s insurance policy and make a comparison with what you need before proceeding to purchase a renters insurance policy.
  • If you need more information about renters insurance, you can contact renters insurance experts to get estimates or contact us and we can point you in the right direction.
Renting to Tenants With a Criminal Record

Landlords who have a rule banning applicants who were convicted of a crime-may want to rethink that policy. Recent guidelines issued by the US Department of Housing and Urban Development (HUD) on April 4, 2016 call for landlords to do away with blanket bans, that disqualify applicants based on prior convictions or arrests. Having a general ban on renting to tenants with a criminal record, precludes applicants from housing solely on the basis a criminal record, could be considered a violation the Fair Housing Act.

The Fair Housing Act

The Fair Housing Act signed in 1968, prohibits landlords from discriminating on the basis of race, color, religion, sex, or national origin. While criminal history is not a protected class, under the new HUD guidelines, turning down applicants on the basis of a criminal record, without considering the nature of the crime or facts surrounding the conviction, can’t be legally justified –and could, indirectly, be a violation of the Act.

As many as 100 million U.S. adults, or nearly one-third of the population, have a criminal record of some sort. Additionally, the United States prison population, with 2.2 million adults, is the largest in the world. Since 2004, an average of over 650,000 people have been released every year from both federal and state prisons –and 95 percent of those currently incarcerated, will be released at some point in the future.

For individuals who are released, the ability to secure safe and affordable housing is a crucial part of their successful reentry into society. Yet many individuals who were formerly incarcerated are finding it extremely difficult to secure housing –because of their criminal history.

Troubles Securing Housing

Michael Bowers, a single father, has had his share of trouble finding housing in Austin, Texas.

This is due to the fact that Bowers has a criminal record. As a teenager, he was arrested for stealing a debit card and going on a $340 shopping spree.

“I was young,” says Bowers, speaking of his crime. “We were drinking. There was a card. I was like, ‘I’m going to use that to buy stuff that I want.’ It was a dumb mistake.”

This crime led to Bowers spending a few days in jail and being put on probation. Today, however, nearly ten years later –one consequence of this mistake continues to plague him –most landlords still refuse to rent to him.

“The most frustrating thing is I’m just a single dad,” says Bowers, who lives in Austin with his daughter. “I work hard, and I just want to give my child a place to live.”

The fact remains that many landlords are rejecting tenants on the basis of their criminal history –or even an arrest that never even led to a conviction, without taking into account the nature of the crime, how long ago it occurred, or rehabilitation.

For people like Bowers who are trying to get their life back together, finding housing remains one of the most difficult hurdles.

Renting to people with criminal history

The HUD Guidelines: Disparate Impact

While many landlords refuse to rent to tenants with a criminal record, doing so may be a violation of the Fair Housing Act.

A landlord violates the Fair Housing Act when their policy or practice has an unjustified discriminatory effect, even if the landlord had no intent to discriminate. This is known as “disparate impact” –which occurs when policies or practices that appear on the surface to be neutral, result in a disproportionate impact on a protected group.

“Criminal records-based barriers to housing are likely to have a disproportionate impact on minority home seekers,” the guidelines note. Black and Latino Americans are disproportionately affected, the memo notes since they are incarcerated at rates disproportionate to their share of the general population. Black and Latino individuals comprise an estimated 58 percent of the U.S. prison population, despite accounting for only 29 percent of the total U.S. population.

Under this standard, even a policy that may seem neutral on the surface –could have a discriminatory effect against protected classes, and thus could be a violation of the Act, if it’s not supported by a legally sufficient justification.

It’s important to note that while HUD doesn’t recognize having a criminal record as a protected characteristic under the Fair Housing Act; proponents argue that criminal history-based restrictions on housing opportunities could, indirectly, violate the Act.

Additionally, proponents state, that by making it easier for people with an arrest record or criminal history to find a home, housing providers will help to increase the chance of an individual’s successful reentry to society.

“The fact that you were arrested shouldn’t keep you from getting a job and it shouldn’t keep you from renting a home,” says HUD Secretary Julian Castro. “The ability to find housing is an indispensable second chance in life.”

JoAnne Page, President, and CEO of the Fortune Society, which works with formerly incarcerated individuals, also highlight the importance of housing for individuals with a criminal background. “We know that if a person does not have a stable, affordable place to live, being a contributing member of society is extremely difficult,” she says.

Considering a Criminal Record: A Landlord’s Requirements

While the HUD guidelines outline what landlords should not do when weighing up a potential tenant’s application, they’re less clear on what type of criminal convictions can be used when assessing an applicant.

As there are no guidelines on which crimes should be considered acceptable, and which are not, aside from certain drug-related charges. In most cases, landlords are advised to use their discretion, with the HUD guidelines stating that they should consider circumstances on a case-by-case basis.

Case-by-case, means that imposing a blanket ban on individuals with a criminal history, is no longer an option. Instead, landlords and property managers will have to put a bit more care into evaluating applications on an individual basis.

Industry groups, such as the National Apartment Association, are weighing in on the new guidelines. The NAA released a white paper on best practices to members, which advised taking measures such as adjusting screening policies to include only certain types of offenses –rather than a blanket ban, outlining clear justifications for those policies, and giving applicants a chance to explain mitigating circumstances.

While the HUD guidelines are just that, guidelines –and landlords are not bound by law to follow them, the best practice is for landlords to take the HUD guidance seriously, and change any current policies that automatically exclude applicants with a prior conviction; as well as any policies that have not been thoughtfully developed and justified.

Steps Landlords Should Take to Comply With the New HUD Guidelines

While these guidelines may sound daunting –the good news is that for most landlords, they may not be as formidable as they sound.

“Employers have been taking most of these steps for years,” explains attorney Denny Dobbins, “It will not be difficult for good Landlords to comply.”

In order uphold these guidelines, though, landlords will need to need to be a bit more thorough when it comes to documenting their reasons for denying an applicant. They’ll also want to ensure that their policy’s approval criteria, as it pertains to a person’s criminal history, are supported by a legally sufficient justification. For example –if a landlord has an apartment complex, they must also take the safety of the other residents into consideration; therefore they may be able to prove that banning individuals who have committed violent crimes is a justifiable decision. Additionally, landlords who house families with children may not be able to rent to anyone on the Sex Offender Registry. Thus, denying a registered sex offender would not constitute a violation of the Fair Housing Act.

But under these guidelines, landlords cannot institute a sweeping ban on all applicants with a criminal history, and cannot reject applicants for arrests that did not lead to a conviction. Additionally, landlords must take care to ensure that all potential applicants are treated the same; and that comparable criminal histories are assessed similarly; without considering race, national origin, or any protected class.

Consider the Crime

HUD states that a housing provider must show that its policy accurately distinguishes between criminal conduct that indicates a demonstrable risk to resident safety or the property and criminal conduct that does not.

Landlords are advised to take into consideration the nature of an individual’s conviction as well as time elapsed since the conviction. The only clear exception that the guidelines make is for convictions for manufacturing or distributing drugs.

Factors that landlords should consider include:

  • The nature of the crime
  • The facts or circumstances surrounding the criminal conduct
  • Time elapsed since the conviction
  • Evidence of rehabilitation

The Nature of the Crime

Landlords that oversee multi-unit residences must balance out their nondiscriminatory screening policies, with their duty to ensure resident and property safety. This means assessing the nature of the crime to see if there is legally sufficient justification to ban an applicant from the housing. Unfortunately, this is a gray area –and one where landlords and property managers alike much exercise diligence and discretion.

While the HUD guidelines aren’t clear, HUD indicates on their website that for public housing authorities, a criminal background investigation must be performed to determine lifetime registered sex offenders –which then may be precluded from housing. It would seem to follow, that if public housing authorities can draw the line at registered sex offenders that non-public housing landlords could do so as well. But when it comes to offenders who are not on the registry, the guidelines are less clear.

“The nature and gravity of a sex crime may be so serious that even the slightest amount of risk may be too much when contemplating the protection of your substantial and legitimate interest(s),” says Denny Dobbins, attorney. “A case-by-case evaluation based on the facts is necessary for how long to prohibit residency for those with a sex crime who do not have a lifetime sex offender registration status.”

Landlords who are uncertain should consult with an attorney.

The Facts or Circumstances Surrounding the Criminal Conduct

Landlords are advised to assess the circumstances surrounding the criminal conduct. This means that they should consider the age of the applicant at the time of the crime, as well as any other mitigating details. Landlords should also take care not to exclude applicants based on arrests alone since an arrest doesn’t always lead to a conviction.

Time Elapsed Since Conviction

The amount of time that’s passed since the conviction occurred should also be taken into account. Although the HUD hasn’t given a specific timeline that’s reasonable for felonies or misdemeanors, some have suggested a period of six or seven years for some felonies or high-risk crimes.

Evidence of Rehabilitation

If an applicant presents evidence of rehabilitation, this should be taken into consideration as well.

Practically Screening Applicants

There are practical ways that landlords can maintain compliance with the HUD guidelines regarding renting to tenants with a criminal background. Here’s a look at a few things landlords should consider doing:

Run Criminal Background Checks Last

When it comes to the application process, landlords and property managers may want to consider running criminal background checks last; until after an applicant has already passed employment and income verification, credit checks, and previous rental history. Not only will this help to keep housing providers from having to make many potentially difficult decisions, it will also save time when processing applications.

Avoiding Problem Screening Questions

One key area where landlords should tread especially carefully is when screening tenants. Asking potentially problem questions such as, “Have you ever been convicted of a crime?” and instead, looking to ask more relevant questions, such as “Have you been convicted of a crime in the last seven years?” is a better option; one that shows that the landlord isn’t imposing an outright ban on applicants with a criminal history; and instead is asking relevant questions and assessing applicants on a case-by-case basis.

Ask for Proof of Mitigating Circumstances

Landlords and property managers should consider informing applicants that, if they have a criminal background, they are welcome to submit proof of mitigating circumstances at the time of the crime as well as proof of any rehabilitation efforts. Requesting this information is a step in the right direction, and also shows that the landlord isn’t implementing a sweeping ban on applicants who have a criminal background.

Review Existing Policies for Renting to Tenants with a Criminal Record

Finally, landlords and property managers should review their existing rental policies and tenant screening procedures. Landlords should pay special attention to ensure that there are no qualifying questions that could be considered discriminatory against potential tenants. Doing away with sweeping statements, such as disqualifying all applicants who have a criminal background; and instead implementing policies that allow for a case-by-case analysis is an important step that housing providers should take to protect themselves.

Renting to Tenants with a Criminal Record

Landlords should inquire with the current and previous landlord to assess an applicant’s qualification. Questions to ask include:

  • Did the applicant pay the rent in full and on time?
  • Did they abide by all the terms of the lease?
  • Were there any problems with the applicant?
  • Were there complaints from other tenants about illegal activity?
  • What was the timeframe that the applicant rented in the unit?
  • Would you rent to the applicant again?

Landlords should also obtain a consumer credit report and carefully check the information therein. Landlords should:

  • Check the information for accuracy. Ensure that the information on the report matches what is on the application –including the name, date of birth, and address.
  • Was each credit grantor paid on time?

Every landlord should have a written list of rental criteria, and ensure that they uphold it consistently with each rental application. Examples of rental criteria include:

  • Sufficient Income
  • Proof of Income That’s 3x the Rent
  • Good Landlord References
  • History of On-Time Rent Payments
  • A Good Credit Report
  • The Ability to Abide by the Terms of the Lease

If an applicant fails to meet the above criterion, the fact that they may have a criminal record becomes irrelevant. In the end, the best way for a housing provider to avoid claims of discrimination and ensure equality for all applicants –is to ensure that decisions are not based on one single factor; a criminal record, and instead seek to use other qualifying questions when making a decision.

In addition to helping to prevent claims of discrimination, this method will also help to alleviate fears of landlords, who may be concerned about safety implications that come from not having a blanket ban in place. As Chris with Tenant Verification Services writes, “In most instances…individuals who have a criminal record and continue to lead that type of lifestyle, will not meet your criteria anyways.”

Finally, landlords should make sure they have a look at the HUD Guidelines for themselves, as well as this helpful white paper from the NAA. They should also consider consulting with an attorney, to ensure that they are screening applicants, qualifying questions, and applications –before refusing to rent to a tenant with a criminal record.

Tenants: do the HUD guidelines affect your home search?

Disclaimer: The information provided is for and advisory purposes only. Springs Homes for Rent accepts no responsibility for its accuracy. We recommend that you consult with an attorney familiar with current federal, state, and local laws.

Pet Liability Insurance PinterestIf you haven't heard of pet liability insurance before you are not alone. Pet owners who live in an apartment community may be of particular interest to this form of insurance. A pet has the potential to injure another occupant on the property and you certainly will want to have some sort of personal protection.

A vast majority of apartments will require future applicants to purchase a renter's insurance plan, and this may be the easiest avenue to acquire liability insurance for your pet as well.

What is Renter's Insurance

Renter's insurance main purpose is to protect you from unforeseen loss while you are renting an apartment or home.

  • This should cover the damage or loss of your personal property.
  • If a person suffers an injury while in your apartment home you may be held liable.
  • If you are displaced because of a floor or fire, a policy should cover alternative living costs.
  • Items stolen from your apartment home should be covered.

You will have to decide if you prefer replacement cost or cash value in the case that your items are stolen or damaged.

  • Replacement cost will furnish you with a brand new item in case of a total loss
  • The cash value will furnish you with money for the current market value of your belongings. They will no doubt have depreciated over time so this normally won't be enough to buy a brand new item.

Renter's Pet Liability Insurance AgreementRemember that many communities will require that you have a policy upon move-in. If you don't want to take out a policy, your application will be denied. Most landlords will have some sort of property insurance.

You should check with them to see if any of your belongings are covered under their policy.

How Does Pet Liability Insurance Work

There are many scenarios whereby pet liability insurance can protect you from unforeseen loss. This will give you some protection to cover any costs related to injury or damage caused by your pet.

Here are a couple of examples to consider

Pet Injury:

Your dog bites a guest who acquires treatment from an urgent care facility or even a hospital emergency room. These can be quite costly. Luckily your pet liability insurance will cover the costs for you. The company will get involved and negotiate with the injured individual directly. Whatever the outcome is, it won't have a major financial impact upon you.

Property Damage Issues:

pet liability insurance dog bite

Dogs with claws can leave deep scratch marks on wood floors or urinate on carpet causing heavy stains. Either way, this damage can result in the entire carpet in the apartment home requiring replacement. The insurance again will cover the costs associated with any repairs being made to the residence.

Don't assume that your regular renter's insurance policy will also include your pet. You will want to speak with an agent who can answer any particular questions you have about a pet liability insurance policy

What Type of Damage is Excluded

As with all insurance policies, there are items that will not be covered. This means that it's on you to replace or repair items damaged by your pet.

  • If your cat scratches your sofa or couch this won't be covered. This applies to all of your personal items.
  • Many pets have been known to attack their owners. If you require treatment for a dog bite or scratch, you cannot file a claim in this scenario either. Pet injury is only covered when the injury is occurred by someone, not in your household. So if your dog bites your wife, your claim will be denied.
  • It's also possible that some insurance companies won't cover specific pets. In fact, certain apartments for rent in Houston Texas won't accept aggressive breeds. This includes Dobermans and Pit Bulls. Ask the apartment community for a complete list.

Be Aware of Insurance Policy Limits

All types of insurance policies will have a maximum amount that is paid out per incident or for the lifetime of your policy. You can choose the parameters of your policy, but anything over will require that you come out of pocket to fulfill those expenses.

Certain dog breeds will have a greater likelihood of biting or scratching. You should take some time and research on how much of a policy you actually need. You might be surprised at the expense you need to care for a dog bite. An insurance agent can help you pick out a policy that makes sense for you/

According to this law firm, the average cost for dog claims were slightly over 37 thousand dollars per incident.

Policies will have deductibles. This means every time you file a claim, you will have to pay for an initial amount before the insurance policy will kick in.

Take-Aways

  • A pet liability insurance policy will protect you from claims filed against you because your pet injured a person or caused damage to the property.
  • All policies will have exclusions. It won't cover any injury your pet inflicts upon you or a member of your household.
  • Policies will also have limits. This means that the insurance company won't pay out once a certain threshold has been met.

Colorado Warranty of HabitabilityThe Colorado Warranty of Habitability is a statute that outlines conditions that a property must meet in order for it to be considered fit for human habitation.

This statute was established in 2008 to protect tenants from unscrupulous landlords. Since then, there have been a few updates and changes made to the document, with the latest changes taking place in 2018.

Many of the issues that this warranty addresses are things that wouldn’t normally arise in rentals that have attentive and fair landlords, however, some of these problems are things that are found in low-income rentals and student housing; which makes this warranty an important tool in helping to prevent dangerous and uninhabitable living conditions.

This warranty states that each rental lease in Colorado carries what is known as an implied warranty of habitability, which stipulates that a landlord is bound by law to keep the property in a habitable state, regardless of whether this is written in the rental agreement or not.

But what does this mean for landlords? What are the requirements outlined in the law? How can you ensure that you’re maintaining your property in a way that’s in compliance with this statute?

Let’s take a look now:

Is your rental habitable?

What Is the Colorado Warranty of Habitability?

The Warranty of Habitability focuses on the condition of a property.

According to the warranty, residential property is considered uninhabitable if it substantially lacks any of the following:

  • Waterproofing - Waterproofing and weather protection of roof and exterior walls must be kept in good working order. This includes intact, unbroken windows and doors.
  • Plumbing - Plumbing or gas facilities must conform to applicable law in effect at the time of installation and be maintained in good working order.
  • Running Water - Running water and reasonable amounts of hot water at all times must be furnished to appropriate fixtures and connected to a proper sewage disposal system
  • Heat – There must be functioning heating facilities that conformed to applicable law at the time of installation and that are maintained in good working order.
  • Lighting - Electrical lighting, with wiring and electrical equipment that conformed to applicable law at the time of installation, must be maintained in good working order.
  • Clean Common Areas - Common areas and areas under the control of the landlord must be kept reasonably clean, sanitary, and free from all accumulations of debris, filth, rubbish, and garbage and have appropriate extermination in response to the infestation of rodents or vermin.
  • Pest Control Improves HabitabilityPest Control Measures – There must be appropriate extermination measures taken in response to the infestation of rodents or vermin.
  • Sanitation – There must be an adequate number of appropriate exterior receptacles for garbage and rubbish, in good repair.
  • Floors, Stairs, Railings - Floors, stairways, carpets, and railings must be maintained and kept in good repair.
  • Locks - There must be locks on all exterior doors and locks or security devices on windows designed to be opened that are maintained in good working order.
  • Compliance With Codes - The premise must comply with all applicable building, housing, and health codes, which, if violated, would constitute a condition that materially affects or is dangerous or hazardous to a tenant’s health or safety.
  • Absence of Mold - Recent amendments to this bill state that the absence of mold is another requirement of a habitable residence.
  • Appliances – Recent amendments to this bill also state that functioning appliances that conformed to applicable law at the time of installation, and that are maintained and in good working order are another requirement.

Unless otherwise stated in section 38-12-506 of the bill, a residence must comply with these regulations –prior to being rented out. So landlords, make sure your properties are fit for purpose before you start running rental ads!

It’s important to note that the warranty states that no deficiency shall render a premise uninhabitable unless it substantially limits the tenant’s use of the dwelling.

So if something breaks down, or requires repairs, this doesn’t automatically mean that you’re in breach of the warranty. Things will go wrong and break down –and you have a reasonable amount of time to complete the repairs.

What this statute aims to do, is to prevent landlords from allowing their properties to become uninhabitable, and to give tenants recourse should landlords be slow to remedy problems that do arise.

So a landlord is in breach of the warranty if:

  1. A residential premise is uninhabitable or otherwise unfit for human habitation; and
  2. The residential premise is in a condition that materially interferes with a tenant’s life, health, or safety; and
  3. The landlord has received written notice of the condition and failed to resolve the problem within a reasonable time.

Now, if the condition of the property is an issue that was caused by the misconduct of the tenant, a member of the tenant’s household, or a guest or invitee of the tenant –then this condition does not constitute a breach of the warranty of habitability.

Exceptions to Warranty of Habitability:

  • If the uninhabitable condition is the result of stalking, or domestic violence, domestic abuse, unlawful sexual behavior upon the tenant and the landlord has been given written notice and evidence of the domestic violence, abuse, or stalking.
  • If the uninhabitable condition is the result of a casualty or catastrophe to the dwelling unit, the landlord may terminate the rental agreement without further liability

Tenant Recourse: Remedies and Requirements

Tenants have recourse should the property they are renting becomes uninhabitable.

However, it’s important to note that this must be a genuine case of a breach, not simply an excuse to break the lease or stop paying rent. This would put the tenant's security deposit at risk as well as leave the tenant responsible for any remaining rents.

Here’s a look at what the Colorado Warranty of Habitability, as well as the steps the tenant needs to take to remain in compliance with the law.

If the premises become legally uninhabitable based on the above criteria, the tenant should first notify the landlord.

The landlord must have been given notice of the problem by the tenant. They then have a reasonable timeframe during which they can remedy the problem.

A landlord has 24 hours to respond after receiving the notice, and their response must indicate their intentions for remedying the condition, along with an estimate of when they expect that the remediation will commence and be completed.

Obtaining an Injunctive Relief:

A tenant may obtain injunctive relief for breach of the warranty of habitability in any county or district court. The court will determine actual damages for a breach of the warranty at the time the court orders the injunctive relief.

However, the landlord will not be subject to any court order for injunctive relief if they tender the actual damages to the court within two business days after the order. Upon application by the tenant, the court will release to the tenant the damages paid by the landlord.

If the tenant vacates the rental, the landlord shall not be permitted to rent the premises again until it complies with the warranty of habitability.

Additionally, amendments to this bill also state that a tenant may deduct the cost to repair or remedy the condition themselves; however, the tenant must obtain an estimate for the costs first. If the amount is greater than one month’s rent, then the tenant may deduct over subsequent months until the amount of the estimate is deducted.

The tenant must provide the landlord with at least ten but no more than thirty days’ notice prior to deducting rent.

If a court finds that a tenant has wrongfully deducted rent, the court will award the landlord either possession of the premises or an amount of money equal to the amount wrongfully withheld, or –if the tenant is found to have acted in bad faith, an amount of money equal to double the amount wrongfully withheld.

Colorado Warranty of Habitability

Terminating the Lease

If the same condition that caused a breach of the warranty recurs within six months after the condition had been repaired, then the tenant may terminate the rental agreement. They must provide fourteen days’ notice to the landlord.

If, however, the landlord remedies the condition within fourteen days of receiving the notice, then the tenant may not terminate the agreement.

In the case that a rental agreement contains a provision related to obtaining attorney fees and costs, then the prevailing party shall be entitled to recover reasonable attorney fees and costs.

Prohibition on Retaliation

The Colorado Warranty of Habitability also prohibits retaliation. If a landlord retaliates against a tenant alleging a breach, then the tenant may terminate the rental agreement and recover an amount not more than three months’ rent or three times the tenant’s damages, whichever is greater –along with reasonable attorney costs.

As a landlord, your best option is to keep your property in good, habitable condition, and to respond to any issues that arise –especially those that would render it uninhabitable, in a timely manner.

It’s also important to protect yourself with an airtight lease agreement, one that outlines the condition that you and the tenant are required to keep the property in, and specifies which party is responsible for what tasks.

Also vital, is maintaining good documentation of repairs as well as any agreements, or communication with your tenants.

Finally, it’s important to have a working knowledge of landlord-tenant law so that you have a good understanding of your requirements and responsibilities, as well as the rights of your tenants.

So you’re thinking of renting to relatives and want to know the tax implications After all, it’s something that seems to make perfect sense. Your child; or maybe it’s your mother or a cousin needs a place to stay and you have a rental property.

If you were to let them live there rent-free, or maybe for reduced rent, you’d be doing them a tremendous favor, and they’ll be able to look after your property for you; helping to keep it in great condition. It’s the best of both worlds.

But while your plan does make sense, there’s just one problem: if you’re not careful, renting your home out to family could mean that you’re no longer eligible for certain tax deductions.

While tax law allows generous tax deductions that many landlords are eligible for, it also has strict criteria that it insists landlords meet in order to remain eligible for those deductions. There are a number of things that a landlord could do, even unwittingly, that could push the property outside the definition of a rental, and into the criteria of a personal residence; eliminating many of these tax deductions.

Let’s take a look at renting to relatives and the tax implications to ensure that you’re eligible for those valuable deductions.

What’s Considered a Rental?

Renting To Relatives Tax ImplicationsFirst up, let’s take a look at what, exactly, the IRS considers to be a rental property.

A property is considered to be a rental if it is rented during the year in question, and used by the owner less than the greater of 14 days – or 10% of the number of days that the unit was rented to others; as long as it was rented at fair rental value.

If, however, you occupy the property yourself for a portion of the year – or rent it out for a reduced rent, then limitations may apply to a number of expenses that you’re able to deduct.

Additionally, if the property is mixed use, then it may be rented and used by yourself for more than 14 days of the year, however, it’s important to note that expenses like insurance, mortgage insurance, taxes, and more will be allocated between rental and personal use.

It’s also important to note that if the property’s rented out for fewer than 14 days during the year, then it’s considered a personal residence, and as such you won’t be able to claim as many tax deductions; only mortgage interest and property taxes. You also won’t be required to report any rental income.

However, complications arise when you are renting to relatives.

These issues usually surround the question of “fair-market-value rent,” and how the IRS classifies rental properties that are rented for less than this amount. Normally people decide to rent out to relatives because they’re looking to give that family member a good deal. But it’s important to realize that for each day that you rent the property for less than its fair market value is considered a personal use day.

Too many personal use days, can quickly push the property into the category of personal use. This could mean that you’d end up having to claim the rent as income, but not being able to claim many of those value tax deductions.

Rental Property Deductions

Part of the appeal of rental properties is the myriad of valuable tax breaks that landlords are eligible for. Some available deductions that many landlords are able to take include:

  • Mortgage interest
  • Property taxes
  • Utilities (If you pay them)
  • Maintenance and repairs
  • HOA fees
  • Depreciation
  • Insurance
  • Professional and legal fees
  • Contractors
  • Some travel expenses to and from the rental

These deductions can add up quickly and make a real impact on the amount of tax that a landlord owes at the end of the year. However, if your rental loses its status as a rental, then most of these deductions will disappear. The exceptions are mortgage interest and property taxes, which you’d be able to claim anyway.

Tips for Keeping Your Rental Property Deductions

If you’re looking to ensure that your property keeps its rental status –and your rental expense deductions intact, the good news is that you can rent to a family member; there are just certain rules that you should follow.

First of all, in order for the property to be considered a rental, you cannot use the property yourself for more than 14 days –or more than 10% of the total days that you rent it to others at a fair rental price.

If you’re not residing in the property yourself, then you’ll want to ensure that you abide by the following:

  1. Charge a Market-Value Rent – And Be Able to Prove It - First up, no matter who you’re renting to, you’ll want to ensure that you’re charging a fair-market-value rent. This applies whether you’re renting to a friend, family member, or any other tenant. The best way to do this is to gather evidence that your rent is at fair-market-value. You can do this by printing or screen capping listings that show properties similar to your own, with rent that’s priced close to your own. Check out a website like Trulia or Zillow to see what other properties are going for. You may also want to get an independent appraisal for the property, just so you’re clear on what a fair-market-value rent is. If you do choose to rent the property to a family member at a rate that’s below market value that’s fine, but you’ll want to make sure you’re aware that you’ll need to reflect this on your tax return –and there will be limitations on how many deductions you’re able to claim.
  2. Be Wary of Giving Heavy Rent Discounts - While in some cases you may be able to give your friend or relative a “good tenant discount,” be careful that this discount isn’t too heavy. In some cases, 20% has been allowed, but it’s a lot easier to defend a 10% discount.
  3. Avoid Giving Gifts to Subsidize the Rent - Next, take care that you don’t give your family tenants financial gifts to help them pay the rent. The IRS could deduct the amounts that you gift them from the rent value, which may disqualify your property as a rental; pushing your property into the personal residence category.
  4. Be Sure the Family Member is Using the Property as Their Primary Residence - Finally, if you’re planning on using the rental property as a rental, and continuing to claim deductions for it, then you’ll want to ensure that your family member using it as a primary residence. If they don’t, each day that the relative spends in the property will be considered a personal use day for you. This means that if the relative stays in the house for, say, four months out of the year, but has their primary residence somewhere else; your property won’t be eligible for the rental property classification anymore.

For more information on renting to relatives and the tax implications, be sure to see IRS Publication 527, Residential Rental Property. Remember, neglecting to categorize your property properly, and taking deductions that you may not be entitled to could land you in serious trouble should the IRS decide to do an audit. Your best option is to be informed, and talk to a tax professional if you’d like to learn more about the tax implications of renting to family members or using the property yourself.

At the end of the day, renting to relatives and tax implications is something that appeals to many. Just make sure you’re going into the decision fully informed about the implications of renting out your property to a relative –particularly how it will impact which deductions you may no longer be eligible for.

Resources:

Note: This article is intended to inform and to guide; it is not meant to serve in place of tax advice from an attorney or licensed tax professional. Please consult a CPA for help implementing tax strategies, or for more information on how renting out your home to a family member may impact you from a tax perspective.

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