• Gary Sandler
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    Published 19 June 2022

    Whether you’re a tenant looking to rent a house, mobile home or apartment, or you’re a landlord searching for a suitable renter, it pays to know the law. In the Land of Enchantment, that law is referred to as the New Mexico Owner-Resident Relations Act.

    Without a working knowledge of what’s expected and required of landlords and tenants, there’s a good chance a dispute will arise somewhere along the way. The key to avoiding problems is to make sure both parties are aware of the “rules of the road”. While laws can be complicated and sometimes difficult to understand, there are some basics that landlords and tenants should know.

    LEASE VS MONTH-TO-MONTH. Landlords and tenants looking for stability typically opt for a lease, which is an agreement that spans a specific period of time. A tenant who signs a one-year lease at $900 per month is actually committing to pay the landlord $10,800 over a 12-month period. Unless one of the parties breaches the agreement, both are obligated to honor the commitment for the full 12 months. On the other hand, a month-to-month tenancy is an agreement that can be canceled by either party at any time.

    LATE FEES. A late fee of no more than 10 percent of the monthly rent may be charged for each month the rent is late. Landlords typically give tenants a three-to-five-day grace period before the late fee kicks in.

    SECURITY DEPOSITS. Security deposits are designed to cover the cost of repairs required to return the property to the condition it was in at the inception of the lease, normal wear and tear notwithstanding. It is not designed to be used as the last month’s rent. According to the law, “An owner is permitted to demand from the resident a reasonable deposit to be applied by the owner to recover damages, if any, caused to the premises by the resident during his term of residency”.

    In the case of an agreement covering a period of one year or less, the deposit cannot exceed one month’s rent. The law also stipulates that “the owner shall provide the resident with an itemized written list of the deductions from the deposit and the balance of the deposit, if any, within thirty days of the date of termination of the rental agreement or resident departure, whichever is later.” Owners who violate this provision are barred from retaining any part of the deposit and could be subject to a civil fine of $250, plus attorney’s fees.

    GIVING NOTICE. The law is very specific about how and when notices to terminate must be given. In the case of a month-to-month agreement, the law states that “The owner or the resident may terminate a month-to-month residency by a written notice given to the other at least thirty days prior to the periodic rental date specified in the notice.” In plain English, that means a tenant whose rent is due on the first day of July must give the landlord notice on or before that day if he or she wants the agreement to end on July 31. If notice is given on July 2, for example, the agreement will remain in place through August 31 unless the parties mutually agree to deviate from the law.

    Rules about pets, additional occupants, repairs, smoking on the premises, parking and scores of other possible provisions should be clearly spelled out in the agreement. Both parties should also document the interior and exterior condition of the property through the use of room-by-room checklists, photos and videos prior to the move-in date so there’s no dispute about the condition of the property at the time of departure.

    Landlords and tenants who enter into lease and rental agreements are entering into legally binding contracts that can be enforced in a court of law, so make sure you read and understand the agreement thoroughly before signing. In addition, both parties are subject to state and federal laws, including the Americans with Disabilities Act, and should familiarize themselves with the basics of each before signing on the bottom line.

    A copy of the law can be downloaded from the New Mexico Regulation and Licensing Department at  http://www.rld.state.nm.us/uploads/files/00%202019%20NM%20UORRA%20-%20CHAPTER%2047%20-%20for%20web%20publication.pdf.

    See you at closing.

    Gary Sandler is a full-time Realtor and president of Gary Sandler Inc., Realtors in Las Cruces. He loves to answer questions and can be reached at 575-642-2292 or Gary@GarySandler.com.

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      Gary Sandler