While inviting someone to live in your home sounds innocent enough, renting out any portion of it technically makes you a landlord, says attorney Janet Portman, coauthor of Every Landlord's Legal Guide. "People tend to think of this as casual and don't understand that many of the benefits and responsibilities of being a landlord often apply to them, too," she says. Here’s a list of things to check before taking on a housemate.
Is it legal? Check for homeowner association and zoning restrictions.
Is it fair? In some states it's considered sexual discrimination to run an ad specifying that you're seeking a woman to share a home. Ask.
Screen like a pro You have the right to run a credit report, as well as checks on the prospective tenant's references and employment.
Ask for a security deposit It can help ensure that spilled red wine on the carpet or a naughty dog doesn't destroy a friendship.
Write it down The right lease or rental agreement protects everyone; consider consulting an experienced real-estate lawyer.
Mind the details You're required to claim the rent you receives taxable income. But you can also deduct depreciation and some of what you spend on repairs and improvements.
If you're going to be moving into someone's home, it’s important to go into the arrangement with a businesslike attitude. Before you move in, make sure you:
Do your homework. If there have been previous lodgers, ask if you can speak to them. Talk to neighbors.
Check the fine print If it turns out that zoning or association ordinances prohibit house-sharing arrangements, you'll wind up feeling insecure in your own home.
Test the space Spend time in the house before you move in. If you’ll be sharing common areas, make sure the owner's ideas are compatible with your own.