Legal issues involved with renting your home

I'm not a lawyer but... my parents did own a rental property while I was at college and I did live in said property - so heres my thoughts.  they are adults and are responsibile for what they do.  They need to knew very firmly what your expectations are of the house and their actions in house.  In our lease it specifically said we could not have keg parties and to do so would result in eviction.  Granted my father would routinely drive by house on way to/from work but stilll.... 

My parents also knew every neighbor and the neighbors had parents phone number and I don't doubt the neighbors would call my parents had we gotten out of hand..... not to mention every police officer knew my father as he had had some hand in their hiring. I do not doubt they would have called Dad had we done something,.

As for liability you do have to keep insurance on the property so I would assume that would cover you.

So we walked a very fine line - kept the noses clean and paid the rent on time!  That's about all you can do 1) very defined rules of renting and 2) liability insurance on house.

I was just reading about a new law (bill?) recently that would apply. I can't find the article, so take my memory with a grain of salt. The law was instituted because of loud college parties /  underage drinking near one of the Florida state schools. In addition to any charges filed against the renters, a written warning was given to the homeowner on the first offense, $1000 fine on the second, and $2000 fine on the third.

I would suggest getting everyone who is going to live in the house to sign the lease and be jointly liable for the rent and responsibilities with the house.  I would further make it a requirement that they get their parents to be guarantors of the lease.  They are adults but they are still young and if they have to get their parents to sign off, they will be a little more conscious of their behavior with your property.  I realize it is your daughter and her friends but college kids don't think when it comes to other people's property. 

You might also just double check your mortgage on the property, if there is one, and make sure that if you are not the primary occupant that they don't have the right to call the note due.  And make sure your insurance policy will cover the property now that it is rental property.

You should check with an attorney who deals specifically with rental contracts.  In some states, you as the landowner may have some exposure to risk introduced by your tenant's actions.  (i.e. in Illinois, the landlord can lose a house where the tenant deals drugs.  This was enacted a few years ago to bring more accountability for who the landlord is willing to have lease the property. ) 

Beyond that, write up a lease specifying all the terms you can think of.  Duration, rent, utilities, insurance, maintenance, subletting, furnishings, etc. are all pretty standard.  You might also include a restriction on non-renters occupation (i.e. they cannot have a 5th friend camp out in the living room for 3 months) or maximum number of people allowed on-site at any one time (maybe 10-15 people).  You can also include a clause (often pretty standard) that the renter can be held liable for property-owner losses caused by the rentor (so, if your house is confiscated because one of the renters is dealing, you have some legal recourse).  Now since one of the renters is your own daughter, you'd be forced to sue your own daughter to enforce this. 

Get your insurance modified to include business coverage since you're having a legal contract drawn up for the lease. 

Also remember, even if you know the people at the residence...if they do not have health insurance and get severely injured, they would be more likely to file suit simply because they don't have the means to pay for their injuries. 

when you get involved in a business deal w friend or family, and this is a business deal, the closer you are to the other party, it becomes exponentially more important to get everything in writing. Your daughter (or you) might misinterprate something you tell her and vice/versa,  but if something is in writing, it's a lot easier to discuss after the fact.

I like the idea of putting the parent's on the lease too-I've done that. If the kid or his parents balk, you've just found out ahead of time you might have a problem. If the parents tell you they don't want to be responsible for their "adult" kid's rent, tell them you don't either either.