Pet Deposits, Pet Fees and Pet Rent
Everything Landlords Need to Know
As a landlord, allowing pets into your property is a major decision. Knowing how to go about it in the smartest way possible means looking into all of your options. One thing is for sure, you want to charge extra to cover the damage these life-long companions can leave behind.
To protect yourself, consider picking between using pet deposits, pet rent, or adding pet fees into your standard lease.
Pet Deposits
What are pet deposits?
It's easiest to think of a pet deposit like a security deposit. It's your safeguard when it comes to those furry friends who can easily wreak havoc on a home. You treat a pet deposit the same as you do a security deposit, making it refundable as long as you don't have to cover damages.
Once a tenant moves out, you assess the pet damage and use this deposit to cover the costs. Just make sure you itemize all issues and save receipts. That way you can send a detailed invoice to your tenants that shows why they're not getting their full pet deposit back.
Common repairs to use a pet deposit for include:
- Stained carpet
- Scratched flooring
- Damaged door frames
- Holes in yard or dug up landscaping
Are pet deposits legal?
Within all states, security deposits are legal. But even though this feels like a very similar thing, a pet deposit is not legal in every state. Before deciding this is the route you want to go, it's best to check your local and state laws to make sure you can legally have a pet deposit where your property is located. Make sure to read the fine print of your local laws carefully.
Pet Fees
What are pet fees?
Pet fees come in handy if you feel like no matter what pet is in your rental, there will be costs associated with repairs when they move out. As it is pretty common for a pet to increase the natural wear and tear on a home, this fee allows you to keep the extra money without having to document what repairs you put it toward.
Unlike pet deposits, pet fees are non-refundable. Tenants will pay them upfront when they sign the lease like a deposit, only this is money you're keeping no matter what.
Are pet fees legal?
As with pet deposits, pet fees aren't legal in every state. Do your due diligence to be aware of your local property management laws. Some states will call them pet fees, but make it illegal for a landlord to collect a non-refundable fee when it comes to pets. This makes it confusing for many property owners as a refundable pet fee is simply a pet deposit.
Pet Rent
What is pet rent?
To allow renters to have their pet over the term of their entire lease, you can also collect money as pet rent. This is like a pet fee, in that it's not something you need to refund your tenants, with the exception of it being a recurring fee.
Often, pet rent gets itemized into the lease as a separate charge but rolled up into the monthly rental payment to make it easier for you to collect.
Is pet rent legal?
Rent is legal everywhere, and there are no rules governing how you, as the landlord, want to divvy up using the rent you collect. If you want to designate a portion of the monthly rent for pets, that's fine. It's also okay to raise the rent, so charging more for pet rent is within your rights as well. Again, be sure to familiarize yourself with any local rent control laws.
How much to charge for pet deposits, pet fees and pet rent
No matter which route you go, it's perfectly within your legal rights to set rules around pets. Whether that means charging extra or restricting certain breeds or types of animals, with the exception of service or companion animals. Most states have regulations in place, you just need to know yours.
Should you decide to allow pets, make sure you're charging the right amount. Going too high can turn renters off, but taking in too little money could mean more out-of-pocket expenses for you. There are also state laws to take into consideration. They can help inform what you actually charge, but on average:
- Pet deposits are usually between 40 and 85 percent of the monthly rent price
- Pet fees are usually $100 to $400
- Pet rent is usually $10 to $100 per month
Determining factors for pet charges
There are a few factors that may influence the actual number you decide on for pet charges. The easiest one that impacts the money you collect is the total number of pets. It makes sense to charge more for two pets than for one, and so on. Just make sure you're breaking out your price-per-pet amount in a way that won't exceed state limits.
Animal type and size can also influence how high you go with pet charges. Obviously, a dog or cat has the potential to do more damage than a fish or hamster. You may want to take that into account. It's also valid to assume a dog over 50 pounds may cause more wear and tear than one under 50.
It's ultimately up to you, but remember, these charges are to cover the expenses you'll incur related to letting pets come in with your renters. You don't want to end up with too little at the end of a lease.
What other pet policies should I consider?
There are a few other important things to consider when you decide to allow pets into your rental unit. You'll need to establish a set of rules that help maintain your property, but also keep everyone around the property safe. Consider communal spaces, landscaping, and flooring. Additionally, you'll need to decide if you'll have pet restrictions of any kind, from breed types to the total number of pets.
Write a pet agreement
It's not only within your right as a landlord to set rules for pets living on your rental property, but you can also require certain safety parameters to qualify a pet to move in. These can all get added to a pet agreement, and can include:
- Up-to-date vaccination records
- Completion of obedience training (for dogs)
- Proper pet identification and medical records
- Pet license
You may even consider asking for a referral letter from the vet or a pet sitter, someone who already knows the animal well.
When it comes to rules, you'll want to share details on:
- Proper waste removal
- Leash laws
- Barking and noise disturbances
You can set specific rules related to pet supervision and rules related to leaving the pet in the backyard for long periods of time; if the property has one. It's also okay to ask pet owners to get liability insurance.
Set pet restrictions
Your state may have regulations in place that dictate which pets you can and can't restrict from your rental properties. Make sure you check with those first before setting your own to ensure you're not acting outside local laws.
That said, the restriction landlords most often put in place when it comes to pets is on the breed. More for dogs than other pets, setting restrictions against more aggressive breeds of dogs can help protect you, and the tenant, from any future issues.
Restrictions related to pet size and the number of pets are often related to the size of your property and what you're comfortable with. It's also worth noting that the larger the pet, the bigger the potential damage.
Let the pets in
People like living with pets. They're cuddly, sweet, and are a member of the tenant's family. Pet owners are even quick to share that owning one can help reduce stress or promote a healthier lifestyle. However, pets are also a risk, so whether you decide to let them into your rental properties is truly a personal decision.
If you do decide to take the plunge, don't forget to cover your bases financially by picking whether to charge a pet deposit, pet fee or pet rent. Each option will give you peace of mind that you won't get stuck with a huge repair bill once those furry friends, and their owners, move out.
Created on: 04/11/24
Author: CreditLink Secure Blog Team
Tags: pet policy, pet deposit , pet fees , pet rent , pet damage , urine , pet stains , pet mess , pet agreement , license,