Businesses are based on trust. But relying only on trust can put you out of business. Just ask anyone who has rented a property to someone because “they seemed all right.”
That’s what rental agreements are for. They are a safety measure for you and your guests.
Yet there are property owners who don’t use them because paper-based rental agreements are complex, costly, and inconvenient to create, sign, and file. And even property owners who do use paper-based or simplistic digital forms (like PDFs) spend way too much time and effort managing them.
eSign rental agreements have been around for a while, but relatively few property managers are using them consistently. That’s a shame, because an eSign rental agreement is more than just an electronic document - it can help you grow and scale your short-term rental business like never before. Especially if you’re taking bookings through your own website.
Now, you might be thinking, “Airbnb, Vrbo or Booking.com don't require rental agreements of any sort, eSign or not! Why do I need one?”
It’s a fair question. Property owners are free to operate without a short-term rental agreement, and many do.
But businesses are also free to operate without insurance. You have the freedom to choose, but the wrong choice could cost you a lot. Plus, most rental agreements include many of the same rules and terms of service that Airbnb requires of its guests and hosts anyway. They just don’t have a formal contract.
Instead of talking about the costs, however, let’s talk about the gains. Let’s talk about what benefits you will get from using an eSign rental agreement.
One of the biggest reasons people don’t like using vacation rental agreements or contracts is because they take a long time to put together. Most of us aren’t lawyers, so reading through and/or writing these documents can involve research, rewrites, and lots of review cycles.
Even templated documents have to be updated with the specifics of each booking - and double-checked to ensure there are no mistakes or terms that don’t apply to your property.
An eSign rental agreement builder, if designed properly, allows property owners to quickly assemble a contract with the appropriate terms and the correct property and renter details. The hard part is done very quickly, which allows the renter and the property owner to move forward with the booking with no fuss.
One of the most annoying parts of working with a templatized rental agreement is that they require a lot of work to customize. You have to go into individual sections, rip out the parts you don’t want, and replace them with new terms.
Writing the new terms from scratch increases the risk of error, and even copy-pasting carries that risk too if you select the wrong or incomplete sections.
It’s much safer to use an eSign rental agreement that is built using dynamic content based on the guest, the reservation and the property itself, like the one we provide on Uplisting. In our platform, certain contract terms can be assigned to special tags. All you would then need to do to build a custom agreement is to select the tags that apply, and the specific terms are immediately brought into the document.
Simple, easy, and effective.
Even straightforward contracts that don’t involve any negotiation can be a challenge for guests to use. If it’s a paper contract, they might not have a scanner - or even a printer. And how are they supposed to get it back to you? Snail mail? A blurry phone photo?
PDFs are tricky, too. Not all computers are able to properly open a PDF, and not all renters know how to fill one out.
eSign rental agreements, in contrast, are a snap to complete. The renter just needs to open the agreement on their browser, scan through the terms, and post a comment or message if they have questions. Uplisting makes signing the contract as easy as a stroke of the mouse or finger on mobile.
No more painful revisions or technical struggles. Just open, read, and sign.
Many of the conflicts between guest and owner are a result of mismatched expectations.
The owner expects there to be no newborn puppies in the house (because who would do that?), and the renter expects the property owner to accommodate little Scout (because the customer is always right).
Then the screaming starts.
Verbal agreements can be misheard, forgotten, or outright ignored. A rental agreement lays rental terms clearly in black and white for all to see, and is harder for both the renter and any legal representation to ignore.
The unfortunate truth of the vacation rental business is that some people just don’t make good guests. They either have habits or living preferences that will put your property at risk, or they want to do things that will be disruptive to you or your neighbours. Sometimes it’s both.
While you can’t read their minds, you can let them know that you have rules, and these rules should be followed while they’re on your property.
Having these terms clearly laid out in the rental agreement and addressed up-front may discourage non-compliant guests. Especially if you’re strict and don’t compromise.
Eventually things will hit the fan, and the lawyers will have to be called in. If it’s not lawyers, then it’s the insurance adjuster.
Don’t get caught in a game of “he said, she said.” A written contract decreases your legal liability in case of breaches. In a legal dispute, the side with the most and best documentation wins.
Make sure it’s yours.
A single rental agreement isn’t that hard to put together, even if you do it manually. But if you have one for every single guest, multiple times a month (or even a week), for multiple properties, then you’re going to start missing things.
Your mind is going to start going on autopilot. You’re going to get sloppy, and may make a mistake that costs you - big time.
If you have an electronic short term rental agreement, one that is both partially pre-configured and easy to update, then this minimises the risk of costly human error. You can trust that you are sending the right agreements, which is one less thing you have to worry about.
Data security is a very serious issue that should concern everyone. All industries are affected, and your own operation should take steps to protect your renter’s information. However, most vacation rental operations don’t have the computer equipment or IT knowhow to safeguard their contracts.
Fortunately, third-party booking sites already invest in this kind of security for both themselves and the eSign rental agreements of their partners. You can rest assured that your contracts are protected against unauthorized access and malicious actors.
Are you getting bogged down by renter negotiation and conflict resolution, and not spending enough time growing your short term rental business? Are you spending more time than you should managing paper contracts instead of developing your properties?
If you answered “yes” to any of those questions, then your business isn’t going to scale.
Your time is valuable, and you can’t afford to get caught up in problems that shouldn’t even be there in the first place. You need to eliminate those obstacles to growth by streamlining as much of the administrative process as you can.
That means using the eSign rental agreement to create, manage, and track your paperwork. It is much more efficient at it than doing it manually, and will earn you more money in the long run simply by giving you the time to work on more profitable tasks.
But what about the conflict resolution and renter negotiations, you ask? As mentioned above, the eSign rental agreement can resolve most of those issues - or at least making it less of a pain.
An eSign rental agreement isn’t just an interesting novelty. It’s a viable tool for your rental business that can drastically affect your property’s security, guest compliance, tracking, legal liability, and growth.
More than that, it’s a must-have for any property manager or owner that owns multiple properties or has a few high-turnover vacation properties.
Still wondering about eSign rental agreements? Uplisting.com can help! Sign up for a free trial and we’ll be happy to answer any questions you may have.
Photo by DocuSign on Unsplash