Hello from Middle Tennessee!

[Amanda Garcia]

Hello all,

My husband and I currently own a townhouse just a bit south of Nashville (Thompsons Station/Spring Hill area). It's an upper middle-class area with great schools and very family friendly. We bought it in 2006. Now our family has grown and we have outgrown our townhouse. We would like to hold on to it and keep it as a rental. Here are a few details and maybe you all can give us some pointers on this process. First of all, we tend to be a bit risk averse. We purchased the townhouse in 2006 and then refinanced it to a 15 year loan in 2008. We refinanced again to another 15 year loan this past May so that it would cashflow with the new payment. The last thing we want to do is to have to feed money to the mortgage every month. Our mortgage, including taxes and insurance is $840/mo. Our HOA dues are an additional $120/mo. Other units in the neighborhood tend to rent for around $1100-$1200/mo. We have $8000 to set aside as an "emergency fund," so to speak. We don't have any debt outside of our mortgage, so hopefully we can weather any "worst case scenarios." We can still make the mortgage payment each month without dipping into the emergency fund if we have a vacancy.

Now that we have all of that out of the way, what are my first steps? Do we need to set up a separate bank account for rent deposits and maintenance expenses? Obviously, we need to draw up a lease. Do you have any suggestions on how to form a lease? I found a site called myrental.com that we can use to screen tenants. Is this a good site to use, or do you have suggestions for a better one? Is it best to use a real estate agent to search for tenants or do you use other means to do this? What type of insurance do you recommend? Did I forget to ask any questions? :) I can't wait to hear some feedback. Thanks!