Key Rental Laws In Michigan for Landlords

2022-02-14

Key Rental Laws In Michigan for Landlords

A wooden gavel representing the laws we have to follow in Michigan
Photo by Tingey Injury Law Firm on Unsplash

 

Play by the Rules, Come Out Victorious!

Being a landlord is being your own boss. As long as you have the financial plan to do so, you’re free to buy a home, draft a lease agreement, rent the home out, adjust the rent, upgrade the property, and finally pocket the rental income and appreciation gains you generate.

But you’re still bound by rental laws set about by the government. You can’t escape it. You just have to familiarize yourself with all the rules and see how you can make the most of the regulations.

Key Rental Laws Landlords in Michigan Should Know

Let’s take a look at the Michigan rental laws all state-operating landlords must know. We won’t list every single detail, but we’ll give you a comprehensive summary with hyperlinks for further reading.

Mandatory Disclosures and Small Claims Court

As early as drafting the lease agreement, you need to disclose certain information to tenants under Michigan law. This includes the following details:

  • Security deposit
  • Any nonrefundable fees
  • Condition of the property (with a move-in checklist)
  • Shared utility arrangements
  • Anyone authorized to act on your behalf (like a property management company)

This isn’t the whole list, so head over to Michigan Required Landlord Disclosures for the complete details. If you fail to do this, your tenants may sue you in small claims court for the damages they’ve encountered as a result of the nondisclosure.

For example, tenants can file a lawsuit regarding security deposits in Michigan small claims court for up to $5,500. You’ll have to know how to defend yourself should a situation like this arises.

Security Deposit Limit and Return

You’ll likely ask for a security deposit from your tenants. No problem with that, but be aware that Michigan law limits how much you are allowed to charge. Here are a couple of key points:

  • The maximum amount is one and one-half month’s rent.
  • You need to return the amount within 30 days after the tenant leaves.
  • You need to include an itemized list of deductions with the returned amount.
  • You need to furnish your name and address for receiving communications and the name and address of where you’ll put the deposit within 14 days of the tenant moving in.
  • You need to place the deposit amount in a separate account in a regulated financial institution.
  • You can only use the fund for the purposes allowed by the law (check the Landlord-Tenant Relations Act, MCL 554.601 et seq) or secure a Landlord-Tenant Security Deposit Bond if you want to use it for other means.

Find the whole list of restrictions and rules in this Michigan Security Deposit Limits and Deadlines guide and Tenants’ Security Deposit Rights in Michigan article. Should you want to get right to the main source, you can also go straight to Michigan Compiled Laws sections 554.602 to 554.616 (2020).

Late Rent Fees and Other Rent Rules

The rent rules vary widely from one state to another. In Michigan, you can accept rent payments in any form you prefer—whether that’s through the mail, online payments, bank transfers, or something else. You just have to ensure that it’s indicated in the lease agreement beforehand.

If possible, however, provide online payment methods for your tenants. As our world becomes more digitized, many will be highly appreciative of the convenience of doing so.

Now, Michigan does not have any laws regarding grace periods or late fees. If you wish to charge a late fee, you can simply include the fee in the lease agreement and have the tenant agree with it. (Still, the best way to avoid late rent payments is by screening them thoroughly and only choosing quality tenants.)

In addition, your tenants are allowed to withhold rent or exercise their right to “repair and deduct” if you fail to address urgent repairs. You’ll want to ensure that you keep up with your maintenance and repair responsibilities, so no rent goes unpaid or withheld.

You can see Michigan Termination for Nonpayment of Rent and Other Rent Rules for more information or read your state laws from the Cornell Legal Information Institute.

Termination and Eviction Rules

Much to our dismay, landlords can’t terminate tenancies without a reason. 

For example, you can only give unconditional notice to quit to a tenant if they have negligently or willfully caused serious damage to your property, telling them to leave the premises within 7 days, or you’ll file for eviction. You’ll have to ensure that the situation really is dire and goes beyond the normal wear and tear. Under this 7 day notice, the tenant does have the right to cure.

If you want to read more about state laws, visit the State Laws on Unconditional Quit Terminations and State Laws on Termination for Violation of Lease. If you’re getting geared up to terminate or evict already, then see this article for Michigan’s eviction process and acquire the necessary notices.

Where to Find Landlord-Tenant Statutes

Should you want to read the law itself, visit Nolo’s State Landlord-Tenant Laws for many articles and charts to browse through. You can also see their Michigan Laws and Legal Information section to find your state laws and access the statutes.

Aside from this, you can also visit any public law library in Michigan to find Michigan statutes. These libraries are usually in a publicly-funded law school, county courthouse, or the state capitol.

Moreover, State and Local Government on the Net, Municode, and municipality websites are great sources for you to know more of the local ordinances, often covering health and safety standards, noise regulations, and antidiscrimination rules that you’ll have to observe.

Knowledge is Key to Conduct a Successful Business

Rental laws in Michigan are extensive, and there is no way to cover them all here. It can also get quite complicated, but we have no choice but to understand the landscape and comply with the laws.

If you want some insider tips (or you need help understanding how a certain law applies), feel free to contact our expert property managers in Logical Property Management for in-depth consultation and advice. We’ve been operating as a property management company in Metro Detroit for decades now and are well-versed with the relevant laws.

Get in touch with us today! Our team is ready to help you understand and apply the laws. We can even take over your rentals to manage them on your behalf if you want to make things a million times easier.

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