Managing Your Risk as a Property Manager/Real Estate Agent

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Whether you are dealing with a management agreement, a lease agreement, accounting records or a decision made by a board of directors, documentation is the best practice for every situation as a property manager/real estate agent.

  • Keep all information, especially emails, organized and easy to find
  • Follow up on in-person and telephone communications with an email or a memo (“As we discussed, …”), and file it accordingly
  • Do not sign any documents you do not fully understandPersonal holding contract.

Although documentation is the first line of defense, below are additional best practices that will help you reduce your liability risks.

Wrongful Eviction Claims (Property Managers)

  • Always read the lease terms on how to terminate the lease and under what circumstances you can do so
  • Be sure to follow the legal process exactly as stated
  • Document all communications in the event you need to refer back to them

Discrimination Claims

  • Familiarize yourself with the protections guaranteed to tenants, such as the Fair Housing Act
  • Local protections may allow for more tenant protection than what the Fair Housing Act provides
  • Consider contacting local agencies for training and materials
  • Ensure all employees are following local and federal requirements

Professional Liability Claims (Real Estate Brokers)

  • Familiarize yourself with licensing requirements — review materials used to obtain your license as they will outline your dutiesReal estate agent showing the house to a couple.
  • Your duties may vary depending on whether you represent the seller or the buyer
  • If you have dual representation, disclose that to both parties and follow jurisdictional requirements and duties for both parties
  • When you are managing assets and bookkeeping, review the management contract as to your duties and responsibilities
  • Comply with all contract terms, including notice provisions
  • If you are dealing with a homeowners association, review the association’s documents

Indemnity Claims

  • Know whom you agreed to indemnify
  • Know what you agreed to do by agreeing to an indemnity provision

Although not every claim can be prevented, taking these simple measures will help when a problem arises. Consider joining local associations or groups to familiarize yourself further in the above areas.

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