Sign lease or sign deposit to hold agreement

[Walt Dockery]

I apologize if this has been asked and answered already.  I searched and didn't find a response to this particular question.

I have an existing tenant who's lease expires July 31, and she will be moving out.  I have recently begun marketing property with availability August 1.  Funds to move in are first and last months rent plus a security deposit.  My question is, if I line up a qualified tenant now (or soon):

Do I have them sign a lease now (for a lease term obviously beginning Aug 1) 

or 

Do we sign a deposit to hold agreement now, then sign the lease Aug 1 when they move in, hand over keys, and provide first and last month rent via certified funds.

In either case I plan to take a deposit to hold now that would roll into their security deposit.

Obviously the above assumes their application, credit check etc. all checks out.    

[JD Martin]

You have them sign the lease and pay at the same time. Your risk here is if the existing tenant doesn't bail you are going to have some problems, because you have legally agreed to rent a place that isn't available for the tenant. They can sue you for damages, which might include everything from staying in a hotel trying to find another place to having to eat at restaurants because they don't have a kitchen. You could attempt to recover that money from the tenant that didn't leave, but I wouldn't count on it.

If it were my property, I would leave some space between the last tenant leaving and new tenant coming in, at least a few days to allow for proper cleaning and repair of anything that needs done. Unless your rental market is so bad that you need a whole month to try to find a qualified renter. In general, I don't bother marketing our properties until the tenant is gone and the unit is empty. We might lose a week's worth of rent with this approach but the couple of hundred dollars is just the cost of doing good business.