Being a property owner comes with a set of legal responsibilities and obligations. Understanding the laws that govern property owner-resident relationships is crucial to ensure a smooth and legal rental process.
In this blog, we will discuss the key Wisconsin laws that property owners need to be aware of, including rental applications, lease termination, and other important aspects of being a property owner in the state. We will also discuss the importance of written lease agreements, lease terms, security deposits, lease termination, and the eviction process. Lastly, we will touch on the property owner’s responsibilities for maintenance and repairs.
Rental Application Process
Before renting out a property, property owners in Wisconsin must follow certain guidelines when it comes to the rental application process. Here are some key points to keep in mind:
Fair Housing Laws
Property owners must comply with fair housing laws, which prohibit discrimination based on race, color, national origin, religion, sex, familial status, or disability. It is illegal to deny a rental application based on any of these protected characteristics.
Owners should be aware that these laws apply to all stages of the rental process, from advertising to eviction. Any violation of these laws can result in severe penalties, including fines and legal action.
To learn more about Wisconsin’s Fair Housing Law & Complaint Process, visit the WI Department of Workforce Development website.
Application Fees
Most, if not all, rental applications come with an application fee. It is important to note that these fees are (usually) non-refundable, even if the applicant is not approved for the rental.
You should be transparent about these fees from the beginning of the application process. It is also advisable to provide a receipt for the application fee to avoid any potential disputes.
Background Checks and Credit Reports
As a property owner, you have the right to conduct background checks and request credit reports from potential residents. However, they must obtain written consent from the applicant before doing so. Additionally, owners must provide a copy of the background check or credit report to the applicant if requested.
Furthermore, property owners must comply with the Fair Credit Reporting Act (FCRA) when conducting background checks and credit reports. This includes providing the applicant with a copy of the report and a summary of their rights under the FCRA if the property owner takes adverse action based on the information.
Denying an Application
If a property owner decides to deny a rental application, they must provide a written notice to the applicant stating the reason for the denial. It is important to have a legitimate reason for denial to avoid any potential legal issues.
Additionally, property owners cannot deny an application based on factors that are protected under fair housing laws (stated above). If an applicant believes they have been unfairly denied, they may file a complaint with the Department of Housing and Urban Development (HUD).
Lease Agreements and Termination
Once a resident is approved, property owners in Wisconsin must adhere to specific laws regarding lease agreements and termination. Here are the key points to consider:
Written Lease Agreement
While oral lease agreements are legally binding in Wisconsin, it is highly recommended to have a written lease agreement in place. A written lease provides clarity and protects both the property owner and the resident in case of any disputes.
A written lease agreement should include all the terms and conditions of the residency, such as the rent amount, due date, security deposit, and rules about pets and guests. It should also specify the procedures for requesting repairs and handling complaints.
Lease Terms
The lease agreement should clearly state the terms of the residency, including the duration of the lease (12 months, 6 months, month-to-month, etc.), rent amount, due date, and any additional fees or rules. It is important to ensure that the lease terms comply with Wisconsin law.
The lease agreement should also include provisions for lease renewal and termination. This includes the notice period required for termination and the conditions under which the lease can be terminated.
Security Deposits
Property owners in Wisconsin can collect security deposits from residents. However, certain regulations must be followed. A security deposit is the “total of all payments and deposits given as security and includes all rent payments in excess of one month’s prepaid rent,” according to the Tenant Resource Center Organization (ATCP 134.02(11)). This means after the rent that you pay in order to live there for the first month, ALL of the rest of the money that you pay upfront has to be treated like a security deposit.
The security deposit cannot exceed one month’s rent, and it must be returned to the resident within 21 days of the lease termination, along with an itemized list of any deductions made.
Furthermore, property owners should keep the security deposit in a separate account and provide the resident with a receipt upon receiving the deposit. They should also provide the resident with a written notice of any deductions made from the deposit within 21 days of the lease termination.
Lease Termination
If either the property owner or the resident wishes to terminate the lease before its expiration, specific rules must be followed. In Wisconsin, property owners are required to provide a written notice at least 28 days before the termination date for month-to-month tenancies (Wis. Stat. s. 704.19(3).) For fixed-term leases, the notice period is typically 30 days.
You should be aware that they cannot terminate a lease without a valid reason. Valid reasons for termination include non-payment of rent, violation of lease terms, or damage to the property.
Eviction Process
In cases where a resident fails to comply with the lease agreement or fails to pay rent, property owners may need to initiate the eviction process. It is important to follow the legal procedures outlined in Wisconsin law to avoid any potential legal issues.
You cannot evict a resident without a court order. They must provide the resident with a written notice of eviction and give them an opportunity to correct the violation before filing an eviction lawsuit.
Maintenance and Repairs
Property owners have certain responsibilities when it comes to maintenance and repairs. Here are some key points to keep in mind:
Habitability
Property owners are required to provide a habitable living environment for residents. This includes ensuring that the property is safe, clean, and in compliance with building codes. Owners must address any maintenance issues promptly.
Owners should conduct regular inspections to ensure that the property remains in a habitable condition. They should also respond promptly to any complaints or requests for repairs from residents.
When you hire Performance Asset Management to oversee your property, we offer residents same-day service for all common maintenance issues. Better service translates into better performance, thus it’s crucial to us to honor our emergency and 24/7 repair requests. Not all property management companies offer these “same-day services”, so if that is something you’re interested in, make sure to ask about their maintenance policies.
Emergency Repairs
In case of emergency repairs, property owners are required to address the issue as soon as possible. Failure to do so may result in legal consequences.
It would be beneficial to have a plan in place for handling emergency repairs. This includes having a list of reliable contractors and a procedure for residents to report emergencies (i.e. emergency contacts or online portal requests).
Resident-Requested Repairs
If a resident requests repairs that are necessary for the habitability of the property, property owners must address the issue within a reasonable timeframe. Failure to do so may result in legal action by the resident.
Furthermore, property owners should keep a record of all repair requests and the actions taken to address them. This can be useful in case of any disputes or legal issues.
Property Management Partners
Being a property owner in Wisconsin requires a thorough understanding of the state’s laws and regulations. From the rental application process to lease termination and maintenance responsibilities, property owners must ensure compliance to avoid legal issues. By familiarizing themselves with the Wisconsin laws for property owners, property owners can create a positive and legally sound rental experience for both themselves and their residents.
Running a property can be a daunting task, that is where Performance Asset Management can help! Our staff is well-versed in the WI rules and regulations for housing and would love to assist you with your property management.
Contact us today to learn more about our services!
