What do the following songs have in common: I Am the Walrus, Time of Your Life, and We Will Rock You? They were all mega hits, but none were primary song on the record.
They were all “B Side” selections: McCartney’s Hello, Goodbye trumped Lennon’s Walrus; Green Day thought Jaded was better than TOYL; and Freddie Mercury and company preferred We Are the Champions.
As multifamily industry professionals, we make a similar mistake when we regard the first page of the TAA Rental Application as more important than the second page. In fact, at the very the bottom of first page of the TAA Rental Application is this phrase: “You must also sign on the back side of this application.” In other words, for this to be considered a valid application, the future tenant must sign the second page.
However, focusing solely on Page 1 and dismissing Page 2 as “just the place where the signatures go” means that you are neglecting the most essential part of the application.
So you don’t make this mistake again, let’s take a long look at Page 2 a.k.a. “the B-side.”
First, notice this heading “Contemplated Lease Contract Information” and the disclaimer below it: To be filled in only if the Lease Contract is not signed by the resident or residents at the time of application for rental. Assuming the applicant(s) is approved, this section establishes the lease contract terms and conditions.
In addition to recapturing information about potential leaseholders and occupants providing on the first page of the application, this section is the first opportunity for you to inform the resident in writing about their financial obligations: security deposit, rent, prorated rent, initial late charges, daily late charges, return check fee, animal charges, utilities connection fee, and reletting charges. Frankly, that is a vast amount of critical information that is absolutely essential for the resident to understand prior to signing the lease.
This section begins the landlord-tenant relationship. Make every effort to ensure that the information contained in TAA Lease is identical to the information in this section. For example, make sure the leaseholders, occupants, term and all the above mentioned financial aspects (rent, late charges, utilities, etc.) are the same in both this document and the TAA Lease. Inconsistency can lead to trouble in Justice of the Peace court if an eviction is necessary.
I cannot emphasize enough the importance of the “Application Agreement” section. In addition to your property, research tells us that (on average) future residents are considering four other apartment communities. That’s five different options. This section lays out the financial consequences if the applicant(s) changes their mind; they are rejected; or they fail to response to your approval.
Take a few minutes to reread this section. Your goal is to fully understand this section and to explain it to the best of your ability to the applicant(s).
Every numbered part of this section is important, but #2 through # 12 and #14 are extremely important for you and the potential resident to understand (helpful tip: have potential leaseholders initial each part as you go over it).
Points to emphasize in this section include:
- application fee and application deposit may or may not be refundable;
- application deposit is NOT security deposit, but may be credited towards the security deposit;
- you have seven (7) days to notify the applicant(s) whether or not they have been approved;
- if they have not been notified after seven (7) days – then they are disapproved;
- if disapproved you have 30 days to the refund application deposit;
- if they fail to sign a lease within three (3) days of approval or they withdraw their application then they forfeit the application deposit.
Just below this section, there is a place to list a doctor in case of an emergency. This section also includes a space to list any important medical information.
Next are two text boxes. The first is extremely important. This box states that the information provided by the applicant(s) is true and that the applicant(s) acknowledge the receipt of rental criteria information.
The second box informs the applicant(s) of their rights prior to signing this document to:
- review the TAA Rental Application; TAA Lease; and community polices; and
- consult with an attorney.
Finally, make sure everyone signs and dates this document. You’ll notice that below the signature line is a space for you to track who, what, and when, action was taken on this application.
As always, if you have questions concerning the legality of any lease form, be sure to contact one of AATC’s member attorneys.
Jim Canon, Milestone, is the AATC Government Affairs Committee Chair. For more information on any of legislative or government affairs topics, contact Perry Pillow at 817-616-0354 or email him at email@example.com.