How to Protect Yourself When Renting Out a Room

How to Protect Yourself When Renting Out a Room

        When renting out a property, one should always consider the safety of the tenant, but the landlord should also focus on protecting themselves. This is because becoming a landlord can come with many risks, from financial liability to even personal safety. Therefore, this article will explore the many distinct options landlords have to protect themselves so they can successfully rent out their rooms. 

Landlord Insurance

        The first and most obvious way to protect yourself is with landlord insurance. Landlord insurance is a valuable way to protect yourself as a landlord, and although many landlords own homeowner's insurance, it does not protect against the actions of the tenants and the damages your house may sustain throughout its renting period. In fact, landlord insurance covers three key aspects of being a landlord, tenant damage, tenant injury, and uninhabitable damages. Tenant damages are basically the damages tenants may cause while staying in their room, such as broken furniture or even a broken window. Tenant injuries, on the other hand, cover medical and legal bills from injuries to a tenant in your property. At last inhabitable damages are the damages to the house that may cause the house to be uninhabitable (Not livable). In other words, let's say a room had a fire accident, you will be unable to rent out the room and suffer losses, but your insurance would cover them. Therefore, landlord insurance is a crucial way to protect yourself.

Create an Entity

        Creating an entity (organization) to rent out your rooms protects your personal assets, as being a sole proprietor ultimately puts those assets at risk, should you be liable for something at your property. For example, if a tenant slips and breaks their back on your property, you could be sued for your own personal belongings such as the house, to cover any damages caused to the tenant. Of course, LLCs can be quite expensive, which is why I would suggest researching what types of entities you can create in your locations.  Another point to consider is that this may not be something everyone needs, as landlord insurance usually covers the basics of what you need. Hence, entities can be advantageous for protecting your personal assets, but it may come at higher costs. 

Analyze Room and House

        Analyzing your room and house is one of the most basic methods of protection, as you would ultimately have to perform this step before renting out your room. In fact, you should first inform yourself about what you are liable for (Responsibilities of the Landlord). Then you should check your house for any factors that could create some problems for you. For example, one of your responsibilities is to keep the tenant safe, and if a smoke detector is not working properly, you would be liable for it. Hence, you should do a thorough inspection of your house, so that you are fully protected by minimizing the potential for violating your responsibilities. 

Tenant Screening

        Another step to renting out your room and one that also protects you is tenant screening. Simply put, when reviewing your tenant applications, you should be conducting various screening tactics. For example, having interviews with your potential tenants to get to know them better (Checking to see if they would make a good housemate for you), while performing background checks to ensure the tenant has not committed any crimes, is who they say they are, and much more. Ultimately, you should be doing your homework and making sure you are bringing in the right tenants. Of course, you should not do this based on discrimination, as another one of our articles emphasizes. 

Set up Personal Security

        This essentially means setting up security protocols and factors for yourself as a landlord. This one is particularly important for landlords renting out individual rooms, as you would be sharing a house with your tenants. For example, you could install locks to your own room and other rooms you don’t want your tenants to go into (Of course, you can't lock them out of rooms your agreement states they have access to). You could keep track of all your personal appliances and objects in the house, to make sure nothing is stolen. You could even install cameras in public spaces (Notice I say public spaces, like the living room or kitchen), although some tenants may find it invasive and could even consider it a factor to not rent with you, potentially decreasing the price of your rental. Nonetheless, you should always consider your own personal security in addition to your tenant’s safety, as one never knows what may happen. 

Security Deposit

        A security deposit, the money given to you at the beginning of the rent, is a self-explanatory safety net to protect yourself. This is because this money covers any unforeseen events such as the tenant not being able to pay rent, breaking something in the house, disappearing without paying, or more. After all, who would not want to minimize their risks of losing income? 

Stay Informed on Laws

        When renting out your room or property, it is of the utmost importance that you keep yourself informed on the national and state laws that may apply to you. For example, as mentioned before, reviewing the responsibilities you have to the tenant or other factors such as reporting the new stream of revenue for your income taxes. It is important to review state laws, and not just the general ones that apply around the country, as many states have different rules that you may not be aware of. If these laws are not followed, you can only imagine the consequences that may follow, from fines to even jail time. 

Maintain Your Responsibilities

        After knowing all your laws that may apply, you should make sure to fulfill them all. For example, as mentioned in another of our articles, you should maintain cleanliness, safety, quietness, while also completing timely repairs and respecting the tenants by safely storing their security deposits, allowing for service animals, not discriminating, and ensuring their privacy. All in all, you should be taking your role as a landlord seriously, and perform your duties and responsibilities accordingly. 

Lease Agreement

        The lease agreement is a great way to get everything in writing, so both parties are on the same page. This ultimately reduces potential miscommunication, and hence, neither the tenant or landlord violates their terms. This ultimately protects you and the tenant in case one of you are not fulfilling their promises as discussed in the agreement. In other words, the lease agreement serves as proof for what each party is responsible for and liable for. Therefore, you should spend quite a lot of time on this aspect, as a poorly done lease agreement could lead to many problems throughout the rental. You should be covering all the details you can think about, as even the smallest ones could turn into a headache for you. For example, if you don’t want parties hosted at your place, you set a specific limit to the number of guests your tenants can bring. 


        Inspections are a great way to not only ensure your tenants are following the lease agreement, but also to ensure the safety and cleanliness for the tenant. For example, with inspections, you can check whether the tenant has brought in illegal substances, whether they have caused damages to the property, while also checking on the smoke detectors and appliances in the room, making sure everything is up to date. Of course, one factor to consider when performing inspections is to make sure you notify the tenant ahead of time, so you are not just barging into their room unannounced, which would ultimately violate their privacy, contract, and the law. Therefore, you should conduct inspections regularly, while also respecting your tenant’s privacy. 


        This is another method of keeping everything in writing. Keeping records essentially means keeping track of your interactions and communication with your tenants, such as emails or even written correspondence. Additionally, this would also involve receipts, such as repairs you may have conducted for your tenant. This protects you from tenants refusing to pay for the repair, or even being suspicious of you overcharging them. In fact, keeping all the records further ensures you are not taken advantage of, should any of the problems results in a court case. Therefore, you should keep yourself well organized, and ready for any outcome or problem that may appear throughout the rental period. 


        As you can see from the previous sections, communication is a significant portion of protecting yourself. After all, many altercations can be primarily attributed to miscommunication. For example, tenants may sometimes do something not specified on the lease agreement, but it’s something the landlord does not like. Hence, it is important to ensure both the tenant and the landlord are on the same page, and well informed about each other’s responsibilities and agreements. After all, communication is not just a great way to protect yourself, by reducing conflicts, but also an exceptional way to make new friends along the way.

        In conclusion, there are definitely many other ways in which a landlord can further protect themselves, and I would encourage you to research more into it. However, I hope this article’s coverage of the most basic protection methods will facilitate your experience as a landlord. 

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