The tough economy has prompted more people in recent years to rent out rooms in their home for extra cash and it can be a lucrative deal for both parties.
Before agreeing to allow someone to move in, there are things you should consider for happy living and things you should know to protect you in the event the arrangement goes south.
America Now interviewed a woman in Charlotte, N.C., who agreed to rent a room out in her house. Tina requested that we not use her last name.
Tina lost her full-time job three years ago. During this career transition period, she has worked a variety of temporary jobs.
When her bills started piling up, she decided to search for a roommate to help make ends meet and she posted an ad online.
"Some people said they were glad I was 50 because they were worried I would party every night," Tina says while laughing. "That made them feel better—the older women looking for a place to stay."
When she narrowed the responses to a viable candidate, Tina decided to draft a rental agreement.
"I looked online and almost did one of the ones online, but it was 10 or 12 pages long and I looked through it and just said I don't think all this stuff is necessary," Tina says.
Instead, she wrote up a one-page lease agreement containing only what she deemed important.
America Now Reporter Jeff Rivenbark spoke with Tom Bartholomy, president of the Better Business Bureau serving Southern Piedmont of North Carolina, who says oversimplifying a rental agreement may not be the wisest thing to do.
"You have to act as a landlord would act," Bartholomy warns. "You have to have a lease that protects you, and the person renting that space from you."
He says you have to treat the relationship between the landlord and the renter as a business.
In addition to charging a security deposit, be sure to charge a fee to cover your expense for obtaining both a credit check and a background criminal check.
Most landlords obtain one or the other, but Bartholomy warns that's not good enough.
"Not only do you want to make sure they can pay their rent; you want to make sure they're not a convicted felon," Bartholomy adds.
Don't forget to ask for references, but keep in mind, most applicants are only going to provide you with the names of people they know who will say good things about them. That's why a credit check and a criminal background check are critical.
"You want as much information as you can get because it's your safety, your family's safety, your home security that you're putting at risk," Bartholomy says.
Once you feel comfortable offering someone a lease, be sure to go over the house rules, which could include chores the tenant is responsible for doing, where they should store their food, and any other restrictions they need to know.
"It's very important, because that's what's going to cause the friction if you are allowing someone to live in your house," Bartholomy says.
If you're like Tina and have lived most of your life without a roommate, start out by offering a short-term lease. If things don't work out, you won't be locked into months of misery.
You can find a variety of rental applications and leases online.
If you have never had a renter living with you, be sure to check with your insurance provider to see if having a tenant will cause your homeowner's insurance to increase.
Regardless of the research you do to identify the right roommate, Tina says something is inevitably going to happen that will irritate you and that's why landlords need to be flexible.
"My mother used to say there's no house big enough for two women, but I'm trying to prove her wrong," Tina says.
The following information is from Tom Bartholomy with the Better Business Bureau of Southern Piedmont/Charlotte, NC.
Read Laws on Renting a Room http://www.ehow.com/facts_5028453_laws-renting-room.html for information pertaining to laws that cover both the tenant and landlord.
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