How Bulletproof Are Your Vacation Rental Agreement Tools? - Part 1

By Author: Michael Canson
Total Articles: 7
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In my previous article, How To Close A Vacation Rental Deal Like A Pro, we talked about how to better your renter inquiry / booking ratio by improving communications with potential guests. Now that your guest is ready to book and he's passed your screening operation, let's make sure that your rental agreement and related documents are doing the job they're intended to do - protect you as a property owner and your guest as a consumer. And maintain that trust-based relationship you've worked so hard to establish with your guest.

Create a comprehensive set of rental documents

The following six documents will enable you and your guest to quickly and comfortably reach a mutual understanding regarding the terms and conditions of his stay at your property:

1. Rental Agreement - This contract, signed by you and your guest, lays out all your terms and conditions, rules and policies and consigns any special arrangements to which you have agreed. It basically stipulates what each of you promises to do or refrain from doing. Below we'll look at what articles should be included in a solid agreement.

2. Invoice

...
... 3. Credit Card Authorization form

4. Guest's Emergency Contacts form - Ask your guest to provide you with names and phone numbers of a couple of family members or friends whom you could contact should he have an accident or other emergency

5. In Case of Emergency sheet - This document provides contact information that your guest might need during his stay - police, fire department, physicians, clinics, hospitals, your housekeeper, your contact info or that of your representative, etc. Leave a copy inside the property as well.

6. Welcome letter with directions - We'll review this document in an upcoming issue.

Your rental agreement - a few guiding principles

- Depending on your rental strategy, you may want to create different templates to deal with different lengths of stay - daily rental, weekend, short-term, long-term. Or a template for families and a different one for groups. Finalize one template first, then work from that one to create the others.

- Try to structure and visually format your agreement so that reading will be easy and pleasant - although a rental document is not exactly exciting reading, you still don't want guests to feel like they're reading the fine print on a credit card agreement! One useful technique is to consign certain topics to appendices - for instance, your rules and policies.

- A rental agreement is a legal document, so you need to be specific, precise and clear in your wording. It is important to aim for a well-structured, comprehensive document that is as detailed as necessary but still as concise as possible. Read it over like your guest will, looking for any questions left unanswered or any ambiguous or contradictory statements or loopholes that could lead to confusion and eventual frustration.

- Once you're satisfied, have your attorney review your templates to make sure they comply with municipal and other laws in the region where your property is located. He should be looking at zoning, taxes, health code regulations and safety requirements.

- Now that your agreements have legal value, you're ready to use them with your guests.From a legal standpoint, it's acceptable to email your rental documents to your guest. But before doing so, convert your Word documents to Adobe PDF documents so that no modifications can be made by the guest. If you agree to any changes with him, make these changes yourself and return the document to him for validation. An exception to the PDF rule is the Credit Card Authorization form or any form you want the renter to fill out by computer.

- Once you and your guest are comfortable with the agreement, ask him to print and sign it. He can either fax or mail it to you, along with the deposit check or the Credit Card Authorization form. Don't accept payment without the signed agreement, and always wait until the check or charge has cleared before considering the booking final.

- Once the payment has cleared, you can send a confirmation email to your guest with the Welcome and Directions letter, key instructions, etc.

Does your rental agreement include these articles?

You should be aware that the laws governing rentals differ depending on your place of residence and other factors. We are not attorneys - the information provided here is done so in the spirit of steering you in the right direction.

Continued in "How Bulletproof Are Your Vacation Rental Agreement Tools? - Part 2"

References

1. Cliff Roberson, The Landlord's Book of Forms and Agreements (McGraw Hill, 2006)
2. Christine Hrib Karpinski, How to Rent Vacation Property by Owner, 2nd edition (Kinney Press Pollack, 2008)