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1. Check references

At the very least, landlords should get independent credit reports and check with previous landlords when screening new tenants. Some also do a criminal background check. Companies such as Houston-based National Association of Independent Landlords can do the job for a reasonable fee.

Keep in mind that it's best to get references from previous landlords. The current landlord may give a rosy reference just to unload a bad tenant.

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2. Buy enough insurance

Too often landlords skimp on insurance -- and they shouldn't. Anyone can become the target of a lawsuit, and landlords are no exception. Also, some property owners require tenants to get renter's insurance. That's because the owner's insurance coverage only repairs and replaces the actual structure and many times the appliances, but not the tenant's belongings.

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3. Just say 'no' to form leases

You can buy a lease form at an office supply store, and it might work -- until something goes wrong. Each state has different landlord and tenant laws; your lease form should reflect the laws in your state. Generic form leases also don't take into account different types of dwellings. A high-rise luxury condo will have different stipulations than half of a duplex or a single family home.

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4. Heed environmental matters

Landlords cannot subject tenants to an unhealthy environment, so they must be vigilant about lead paint, asbestos, mold and overall indoor air quality. Lead is particularly a concern with properties that were built before 1979. It may be a good idea to have an older property inspected by a licensed lead-testing company to determine if problems exist and how to correct them.

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5. Consider hiring a property manager

Landlords can always opt to farm out the drudge work of finding, screening and managing tenants to a property manager. But they'll pay a fee, generally 10 percent of the rental proceeds, less for large, multiple-unit complexes. Hiring help enables the property owner to focus on other, more important entrepreneurial matters such as buying other properties and managing the equity in the property, says one self-described real estate wealth developer.

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6. Demand a hefty security deposit

A landlord can avoid some problems by demanding an adequate security deposit from tenants upfront. It's not uncommon to ask for enough money to cover rent for the first and last months, plus a separate security deposit in the amount of one month's rent. Insist on getting the deposit before the tenant moves in and in certified funds: cashier's check, certified check, money order or cold, hard cash. Be sure to document the property's condition by taking photos and getting an affirmative signature from the tenant.

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