Rental requirements up front

[Zachary Stein]

Hello! My fiance and I just purchased our first property and look forward to renting it out in the near future. I wanted to get some insight on a few things. 

1. Is it unusual/excessive to require first, last and deposit? I really want to protect our investment and the items that would also be coming with the rental (couch, bed, tables etc..). I plan on screening with rentprep but still, people can be terrible.  

2. I plan on consulting with a lawyer and real estate agent but I want the guidelines for living in the rental very specific when it comes to how/when to pay rent. what happens when it is late. What loses your deposit.. etc.. Is this ridiculous to want to include? Does anyone charge a penalty for late rent?

[Nathan Gesner]

Quote from @Zachary Stein:

Collecting last month's rent is not "unusual" but it also isn't "standard" for most Landlords. Study your market to see what other Landlords are doing. I personally charge a deposit equal to one month of rent or up to two times the rent. How much I charge is based on the strength of the applicant. The higher the risk, the more they pay. It works well for me and with 400 rentals under management, I rarely have Tenants leave owning more than the deposit.

There are a lot of questions, many that you probably haven't even thought of yet. I recommend reading a couple books that you can get an understanding of what management entails and start developing a plan for how you will deal with problems like late rent, unauthorized tenants or animals, lease violations, early terminations, etc.

Check out "Managing Rental Properties" by Brandon Turner or my personal favorite, "Every Landlord's Legal Guide" by NOLO. Written by attorney investors, it's full of practical advice pertaining to management of investment property, has sample forms that can be edited, and - most importantly - they tell you what your primary state laws are and where you can read them. It's updated every year and is the best $40 you'll spend as a Landlord. There is one book for 49 states and a separate book for California. They also have a great website with the same information, but a book is easier to read/reference.