As an investor with multiple properties, there are a lot of numbers to keep track of. Rather than recording your finances throughout the notes section of your phone or on scrap paper that will get buried on your desk, you should use a form of bookkeeping called a ledger to keep your finances in order.
Landlord Lease Ledgers
A ledger keeps track of debits and credits from multiple accounts and shows their current balances. A lease ledger follows the same concept with only slight variations. A lease ledger keeps track of the debits and credits from your account and associates them with the property they correspond to, as shown in the example below.
Some landlords choose to use one ledger for all the properties they manage. Others decide to use a different ledger per property.
On your ledger, you keep track of all your expenses, like taxes, mortgage, repairs, and HOA fees. You also keep track of when your tenant paid and how much they paid.
Additionally, you might want to include when your tenant paid their security deposit and how much that deposit was. If you need to deduct money from the security deposit, note that in the description section.
If you would like to print out your own, you can download our lease ledger printable form. You are welcome to use this landlord lease ledger template for free.
Lease ledgers, also called rental ledgers, are used to track your expenses and your rent collection. They make it easy for you to see how much you’re earning each month in rent and how much you’re spending each month on repairing your properties, home owner’s association fees, loans and property taxes. It’s an organized way to keep track of what you spend and what you earn.
At the most basic level, lease ledgers can help you ensure that all of your tenants have paid rent.
Additionally, they serve as proof of when you’ve made repairs and how much you have spent on them. That is an important aspect that you could use in court, in case your tenant ever claims that they were withholding rent because you weren’t making repairs. Your ledger can serve as proof that you do diligently repair your properties. You may even want to have your tenants initial over the description of each repair to confirm that you did make it. Or, if you are looking to evict a tenant, it can serve as a record of months the tenant has gone without paying the rent.
One of the best parts about rental ledgers is the unit section. If you’re wondering whether it is worth keeping or selling a unit, you can just look through your rent ledger to see if that unit is profitable based on what you collect and what you spend. A unit with a high HOA fee and high mortgage payment may cost you more money than you’re earning from it. The ledger makes that clear.
Another great part is the description section, it helps you keep track of what you’re repairing. If you notice that you’ve made repairs on the A/C in the same unit multiple times, then you may want to invest in replacing the entire A/C unit to avoid fixing it a few more times before ultimately having to replace it anyway.
Your tenant may ask for a copy of your lease ledger as proof of timely payments. So long as all information is accurate, it is not an issue to give it to them. However, they may use it as evidence should you later file suit against them for missing payment.
Tenant Lease Ledgers
Tenants can and should create lease ledgers as well. Keeping one up to date can help you remember if you have made your rent payment for the current month yet.
Writing down when you make payments may not be the best proof that you are up to date on your rent payments when you go to court because you can write in payments you have not actually made. If you are looking to maintain evidence of payments, make sure to pay rent only by check – never by cash. Write down the check number next to your payment on the ledger. If that check was cashed in the amount of your rent, it serves as good evidence that you have been paying rent.
A ledger can serve as evidence as to why your landlord claims you’re behind. If your contract with the landlord states that you can deduct repairs and improvements from the cost of rent, you can document them here.
Make sure to staple all receipts, permits, and evidence of the repair or improvement to the ledger for safe keeping. It would also help if you communicated with your landlord about the repair or improvement in writing – preferably through email. Print out those emails and staple them, as well.
Write down the repair you made and how much it cost. Then write down the month you are deducting the cost from, like in this example below:
If you would like to create your own, download and print our sample tenant lease ledger printable form. Use the tenant lease ledger template for free.
Here, you would write when rent is due, when you paid it, how much is due, and how much you paid. In the case you are writing about an expense you made to repair or improve the property, you would skip over the “due date” and “total due” fields. Instead, you would write the amount you paid to make the repair in the “total paid,” when you paid in the “date paid” column and what you paid for in the “description” column.
On most months, a tenant needs only to write one entry on the lease ledger – rent payment. A tenant should not frequently make improvements and repairs to deduct from rent payment. If you are doing so, have your landlord’s written consent to the repair and deduction.
Typically, if a repair is important enough to deduct from rent, the landlord will make it themselves.
Remember, it is not your landlord’s responsibility to fix wear and tear, and you should not deduct those repairs from rent.
What is a Lease Ledger?
A lease ledger is a place for tenants to record payments they have made and for landlords to record payments they have received. Additionally, tenants and landlords can record expenses made on repairs or improvements to the property.
The document can be used in court; however, without signatures from both the landlord and tenant or receipts, it is difficult to prove that what is written on the ledger is accurate.
As a tenant, you may want a copy of your landlord’s lease ledger at the end of the tenancy as proof to future landlords that you are a good tenant and as proof that you made all your payments, should your current landlord contest that later on. A copy of your landlord’s lease ledger is much better evidence than your own.
The ledger is more useful for personal record keeping.