Many homeowners in the United States and different parts around the globe rent their apartment or some of the rooms of their home to people traveling for short term. This is one of the ways most people do to raise money especially during hard financial times. The money goes a long way in helping one supplement his income and take care of the basic needs like paying tuition in college. While this is a common practice which has been made more efficient by the use of online platforms to get tenants, it is incumbent for the owner of the property to consider a number of risks that may arise.
One of the unfortunate things that may happen during the rental period is accidents that may occur and expose the homeowner to potential liability. There may be an accident where the tenant may be injured while in the property and open you to a possible law suit. It may also happen that arising out of the negligence of the tenant, certain property is destroyed and leads to loss in replacing the property. The tenant may also refuse to pay you’re the money agreed as rent during the term he or she stays in one of your rooms or takes up the whole of your apartment.
Due to the unfortunate occurrences that may happen, it is important for one to have at the back of his or her mind, the legal implications that arise out of this kind of tenancy. In most cases insurance firms refuse to pay for claims that arise out of short term tenancy agreements where loss occurs in a home insurance policy. This is because the policy that one took with his or her insurer did not cover business liability but only misfortunes that happen out of using the apartment as a home. It is imperative that if you rent your apartment regularly to people visiting through online rental platforms to take up a business liability policy or talk to your insurer to upgrade your policy.
Some jurisdictions require compliance for people in the rental business. It is necessary to familiarize yourself with the requirements to avoid penal sanctions if you do not comply. You can seek the advice on a lawyer to inquire if there are any legal requirements like licenses.
Richard Blair is a registered investment advisor at Wealth Solutions in the Austin area in Texas. The firm deals with advising clients on investment, retirement and strategies to preserve and grow their wealth. His expertise in finance and investment has enabled him steer the firm to where it is today. He is a graduate of the University of Houston with a degree in finance.
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