8 Important Landlord Legal Responsibilities in Michigan
As a landlord, you need to be aware of any and all legal responsibilities pertaining to your rental property and your tenants. Navigating the legal framework of the state is one of the most crucial elements to success in this business, ensuring fairness for both you and your tenants. With this in mind, we gathered some of the biggest points to consider and organized them into a handy collection for your reference.
The following is a list of the eight most important legal responsibilities you need to know as a landlord to avoid legal problems in Michigan.
Use a Legal Written Lease/Rental Agreement
Your rental or lease agreement lays out all the legal rules that you and your tenant must follow, under local, state, and federal laws. When you and your tenant sign the agreement, you’ve established the contractual basis of your relationship. This will set in paper all crucial business details of the relationship, including the length of time that the tenant will occupy the rental unit and the amount of rent itself. It’s square one for legal responsibilities as a landlord.
It’s also potentially rife with pitfalls. Sometimes landlords add illegal clauses to the agreement; for example, they may include a waiver of landlord responsibility to keep the premises habitable, which is one of the legal responsibilities outlined below. Landlords can also make the mistake of omission, failing to make all legally required disclosures in the agreement. Even beyond specific legal requirements, landlords will want to define any potentially disputable issues to prevent problems in the future. A great example would be outlining when and how the property can be accessed, or specifying the date rent is due.
While verbal leases that are less than a year in length are legal in Michigan, they don’t make good business sense and are difficult to enforce. Preparing a truly effective and fully legal lease or rental agreement will clarify all rights and responsibilities—for you and your tenant alike.
Provide All Legally Required Disclosures
We mentioned legally required disclosures above because it is one of the most common mistakes landlords can make and because it comes with serious ramifications. The law in Michigan specifies a number of specific disclosures to tenants, including: the name and address of the landlord, information regarding security deposits and notices of damage, text regarding the rights and obligations of both parties, requirements if a tenant is exposed to domestic violence, and more. These are in addition to state and federally required disclosures regarding lead-based paint on the property. Failure to disclose these will result in large financial penalties and/or lawful termination of the lease by the tenant.
These are the required landlord disclosures.
Comply with All Anti-Discrimination Laws
Fair housing laws are the foundation upon which equal housing rights exist in this country. Thus, before you begin to advertise an open rental unit, you need to understand fair housing and its effect on what you are able to say and do when selecting a tenant. This is an important prerequisite because it affects how your rental unit is advertised, what questions you may include on your rental application or ask when interviewing applicants, and how you will deal with anyone who becomes a tenant on your property. Remember, failing to follow fair housing laws can result in expensive discrimination lawsuits and damage your reputation as a landlord.
In Michigan, landlords are legally allowed to reject applicants for a number of reasons. These include bad credit history, negative references from prior landlords, a history of late rent payments, and other factors that make them a bad financial risk. However, fair housing laws specify the criteria for which potential tenants may not be rejected or discriminated against. As a landlord, you are not legally allowed to discriminate based on race, religion, nationality, sex, gender, family status, or physical or mental disabilities. These are all considered protected classes under the federal Fair Housing Act of 1968. Michigan adds two additional protected classes: marital status and age. Local laws often add additional protected classes such as sexual orientation, source of lawful income or height and weight of the prospective tenant. Be sure to check your local ordinances. Note that the law does make exceptions for owner-occupied buildings with four or fewer rental units and single-family houses—in the case where the owner operates no more than three rental houses at a given time.
Observe State Rent and Eviction Rules
As a landlord, you naturally want your tenants to pay their rent on time and without much coaxing. Similarly, you will want to be sure to comply with the laws here in Michigan in the event you need to raise rent or evict a non-paying tenant. State law regulates several important rental issues, including how much time a tenant has to pay rent—seven days—or move out before a landlord is legally able to file for eviction.
Follow State Security Deposit Limits and Return Rules
To avoid problems when it comes to security deposits, you’ll want to know the limits state law puts on how much can be charged. Here in Michigan, that limit is one and a half times the monthly rent and the deposit must be returned within thirty days after the tenant moves out—unless there are legal reasons the landlord can retain the deposit for damages. Note that security deposits are a common source of dispute between landlords and tenants. This is why Michigan requires the use of a “beginning and ending inventory checklist” when the tenant moves in and out of a rental unit. Including the checklist in your rental agreement is the easiest way to incorporate the process. Seeking money for damages after the tenant has moved out without the checklist can be problematic.
Provide and Maintain Habitable Housing
The law requires landlords to keep any and all rental properties habitable; this falls under the legal doctrine of “implied warranty of habitability.” This means taking care of all important repairs, including broken heating and cooling, plumbing, and electric, within reasonable time. If not, tenants have recourse—they have the right to withhold rent and even pay to have the repairs performed themselves and deduct the cost from rent.
Never Retaliate Against Tenants Exercising Their Legal Rights
Here in Michigan, it is completely illegal to retaliate against any tenant exercising their rights under law. What does this mean? One clear example would be raising the rent or starting the eviction process for a tenant who complains about non-habitable housing or unsafe living conditions. To avoid any chance of problems in this area—and to prevent false retaliation claims—you will want to be diligent about documenting all repairs and other official interactions with your tenant. With a full, legal paper trail to clarify the tenant-landlord relationship from the beginning, you’ll be on the best legal standing possible in the unlikely event of retaliation claims when, for example, you have to raise rent.
Follow Legal Procedures for Eviction or Termination of Tenancy
The laws in Michigan are very clear about the amount and type of termination notice you must serve tenants, specifying when and how the landlord may end the tenancy. The law states that landlords must give non-paying tenants up to seven days’ notice before they can file for a non-payment eviction. Failure to observe the law can result in lengthy delays, undermining the very purpose of an eviction—so be sure to always keep these limits in mind, especially when dealing with the likely stressful situation that leads to this moment.
A Final Note
The above list showcases the most important legal responsibilities for landlords in Michigan, but there are further guidelines to be aware of and a whole host of potentially sticky legal situations to navigate. For further information, be sure to check out the other resources available on our website. You may also want to check out information provided by relevant government or related agencies, including the U.S. Department of Housing and Urban Development and local fair housing agencies. These can provide important legal information on their respective websites. If you find yourself with more specific legal questions about your own rental units, don’t hesitate to consult with a local landlord-tenant attorney. Several attorneys offer free limited legal advice for RPOA members.
Disclosure: This Knowledge Base article is accurate as of the last update. Laws and policies are subject to change. If you have any questions, please call the office. Click here for contact information.