The California landlording quiz below is based on laws and landlording rules that should already be or become a part of your management procedures. The purpose of the quiz is to keep you out of courts, from paying unnecessary fines, to make your job easier, headache-free and save you money.
The quiz was developed from AOA member calls from landlords who found themselves in hot water and paying extensive fines by being unaware or not diligently following California landlord laws, rules and regulations, their instincts … or by making high-priced exceptions to the rules.
Test your knowledge now and possibly save money in the future. Good luck!
- Security Deposit Refund Letter: Without exception, unless a landlord gives a written accounting of monies withheld (actual itemized deductions) from a security deposit along with repair receipts and/or invoices over $125.00 within ____ days of the tenant’s move-out date, if sued in small claims court, he will be liable for up to twice the amount of the deposit in statutory damages. (AOA Form #133 – Security Deposit Refund Letter)
- Tenant’s Right To Pre-Move Out Inspection: BEFORE a final move-out inspection, AB2330 says that a landlord MUST notify the tenant in writing of their legal right to request an Initial Move-Out Inspection to give them an opportunity to correct problems in area for which they will be charged on the final move-out. This initial inspection should be performed no sooner than ______ weeks before the intended final move-out date. If this pre-move out inspection is not offered to the tenant, you will be more likely to lose if sued in small claims court over a disagreement in charges deducted from the security deposit. (See complete instructions including necessary forms on AOA Form #135 – the AB21330 Walk-Through Process)
- Handing Over Keys: Without exception, and under no circumstances, should a landlord give a new tenant keys without first getting these two items:
- Rejecting An Applicant: When rejecting an applicant’s application due to poor credit, it is acceptable to verbally notify them that they do not quality for your unit. TRUE OR FALSE?
- Posting Notices: In the city of Los Angeles, there are two “MUST POST” notices at your building. If these notices are not posted in a conspicuous place, you can and most likely will be cited and fined by city inspectors. What are these two notices?
- Resident Managers – (16 units or more): Name four things that as an owner, you MUST comply with if you have a resident manager in your apartment building.
- Credit Reports: It’s okay to hand your applicant a copy of a credit report you obtained during the screening process. TRUE OR FALSE?
- New Tenants: When executing a rental agreement for buildings built before January 1, 1978, California law requires that you also give new tenants a copy of the _____________________________________ booklet and have the new tenant sign that they received it.
- Interest On Security Deposits: What nine cities in California require interest to be paid on security deposits and when must you pay them?
- Landlord Law Book: Where can I get a copy of Nolo’s California Landlord’s Law Book: Rights & Responsibilities? I understand it is a “must have” for housing providers.
- Tenant Screening: What are the proper steps to take when screening a prospective tenant.
- Bonus Question: How can you possibly realize a substantial savings on your apartment building insurance like other owners are now doing?
ANSWERS
- 21 days
- Two weeks
- The TOTAL of the security deposit and first month’s rent in MONEY ORDER or CASHIER’S CHECK ONLY and a fully executed lease and/or Rental Agreement. (AOA Form #101- Rental Agreement and/or Lease.)
- The Fair Credit Reporting Act requires that you give certain and specific information in writing to applicants that you reject as the result of a report from a credit report agency, a tenant-screening (eviction), reference service or any other third party. These are known as adverse action notices – (AOA Form#140 – Tenant Rejection Notice.) If, however, you don’t rent to someone based on information that you obtained on your own, no written notice is necessary.
- The Toxic Substance Warning Notice (Proposition 65) and the Rent Stabilization Ordinance Notice to Tenants informing them that the building is under rent control. NOTE: All apartment buildings, even if not under rent control, should post the Toxic Substance Warning Notice. AOA Members may download and print these notices from the AOA web site (www.aoausa.com).
- (1) You MUST carry Workers’ Comp Insurance
(2) You MUST provide them with a W-2 form each year by January 31st.
(3) You MUST pay payroll taxes to the IRS whether you compensate your manager with reduced rent or a paycheck.
(4) As an employer – you MUST have an employer identification number.
(5) You SHOULD have a written rental agreement and a written employment/manager agreement.
(6) You SHOULD have your manager turn in a weekly report on actual hours worked.
7. FALSE: You should never give an applicant a copy of their credit report. You can order a “consumer copy” from AOA’s Credit Reporting Department which will then be mailed directly to your applicant. The credit report you receive is for your eyes only and has information an applicant should not see.
8. The Environmental Protection Agency (EPA) Lead Base Paint Booklet. Members may download this booklet from the AOA web site. (www.aoausa.com
9. Berkeley, East Palo Alto, Hayward, Los Angeles, San Francisco, Santa Cruz, Santa Monica, Watsonville and West Hollywood. Each of these cities have separate regulations as to when you must pay these interest amounts, how much you must pay and whether or not an interest-bearing account is required. If you have apartment buildings in any of the above listed cities, please call your city to find out if you are adhering to their specific requirements. Note: A list of all the cities’ specific requirements may be found in Nolo’s The California Landlord’s Law Book: Rights and Responsibilities.
10. Nolo’s Landlord Law Book is available to all at AOA for $44.99 plus tax and shipping, however, AOA members may obtain it at the discounted price of only $28.95 plus tax and shipping. Call or stop in your nearest AOA office.
11. Thorough screening of your applicants is imperative. AOA’s newest form, The Application Screening Checklist, (Form #100S) is a complete step-by-step guideline designed to keep your screening process organized, thorough and in compliance with California rental laws. AOA members can download and print this convenient form at www.aoausa.com.
12. Call AOA’s Exclusive Group Insurance Program to receive a free quote. One of the first AOA members to join the group saved 29.97% on their Workers’ Compensation insurance policy alone! Others have saved anywhere from 31% to 61% on their insurance costs. Call (800) 227-7434 TODAY and see how much you may be able to save!
Patricia A. Harris is Senior Editor of the Apartment Owners News & Buyers Guide. This article is a general guide and has no legal representation. It is suggested that you contact an attorney for legal advice should the need present itself.