The phone rings. You have an apartment to let and someone is interested in renting it. Good news. However, this situation doesn't always work out well. Sometimes people don't pay the rent or they may cause damage to your property or belongings. So what can you do to minimise the risk of this happening and protect your interests? José Luis Galeote is a lawyer who specialises in such matters. He is on the governing board of the College of Lawyers of Malaga, and we asked him what landlords can do to protect themselves from a bad experience.
A written contract
Although a rental contract can be agreed verbally, that is definitely not advisable and is in neither party's interest. José Luis Galeote explains that with a 'gentlemen's handshake' type of rental there is no way of proving what you have agreed if there is disagreement between landlord and tenant at a later date.
It is always advisable, therefore, to have a written rental contract. In fact, José Luis insists that the contract should be drawn up by a lawyer, because he or she will know what they are doing. “I have seen private contracts which are a mishmash of bits of others and in the end they are completely chaotic. They are not worth the paper they're written on,” he says.
Ask to see proof of income
When signing the contract, the owners usually ask the potential tenant to show them proof of their salary or their employment contract. José Luis says this is a way of proving that the tenants are solvent and can pay the rent.
Draw up an inventory
It is very important to attach a complete inventory to the contract, showing the furniture and equipment which is in the property and the condition it is in. José Luis says this is something people do not often do, and it is a safeguard in case tenants damage something in the home, which the owner may not notice until the tenants have moved out and he or she takes possession of the property again.
“We have seen cases where the property has been completely destroyed. For example, the tenants have even taken the TV with them, but if it is not shown on the inventory it is difficult to prove who it belonged to,” he explains.
When someone is going to rent your property, it is always a good idea to ask for a deposit. José Luis Galeote explains that landlords can sometimes obtain a bank guarantee, which is “very good,” but he admits that some banks are reluctant to give these, especially in the case of individuals rather than companies or businesses.
If that is the case, he suggests that another person, who is not the tenant, should act as guarantor and sign the contract as such. “For example, if you are renting to a young person or couple, you can ask that their parents act as guarantors, to protect your interests if the tenants don't pay the rent,” he says.
The Law of Urban Rentals says that an owner can ask a potential tenant of a residential property for a one month deposit, or two months in the case of commercial premises. However, in some cases people ask for more. José Luis says that some owners ask the tenant for a sum of money which is equal to several months' rent, to cover themselves in case of non-payment. It gives them a margin. This is fairly common in the case of commercial properties, but it is not requested as often for residential lets.
Something which is becoming more common nowadays is for landlords to take out an insurance policy, so that the insurers pay the rent if the tenant fails to do so. Even so, José Luis recommends reading the clauses carefully to make sure that the insurance cover is adequate.
If a tenant doesn't pay, says José Luis, you need to act quickly. He recommends taking the tenant to court, because that can take months, and it could mean that you receive no rent during that time. “The earlier you do it, the less time the tenant is living in your property without paying,” he insists.