After being a landlord for 6+ years (basement suite in our house and now our full house). Don't be a laid back landlord and don't do month to month if you can avoid it. Leases are pretty much bullshit anyway and tenancy laws always trump them, but they are good for setting our rules and regs and for formally documenting your agreement with a tenant.
Download and fully read and know your states local tenancy law act. Know it well before you begin, be open and upfront with prospective tenants that you are very nice, flexible and forgiving but will follow the tenant act exactly to the letter, exactly, as this is a business and it's not personal. Big thing to remember, you're not looking to make friends, you're looking to make money. Don't get to close to your tenants... be nice, have a drink, keep it courteous and peaceful, but no more. Don't ever rent to family or friends... ever!!! Make excuses...
As long as both tenant and landlord follow all rules we'll all be very happy. Have a good lease and sit down with your tenants and walk them through it clause by individual clause ensuring they understand every one. 97% of renters do not know shit squat about their own rights what-so-ever... So this is also the time I usually pull out a copy of the tenancy act and walk then through it (here's what I can't and can do, what you can and can't do, etc), it will blow their minds. Do a written walk through with the tenant with pics/video prior to the tenancy, and do one post. Get everything in writing, keep notes, take pictures, make copies of everything and date everything. It's all very simple stuff but protects you and your tenant.
I have had wonderful tenants and I've had not so great ones. Nothing too crazy, but I've always had the piece of mind that everything I'm doing/have done has been fully documented and is written and fully legal and by the book.
People will fuck you over at the drop of a hat... everything is always great until it's not, and when it goes bad there's usually no notice, and it usually goes very bad. There are people who specialize in not paying rent... They know their rights to the letter (tenancy laws are skewed to protect tenants, as they should be) and will take full advantage of "laid back landlords", they are very good at looking like model tenants at first, then things go very bad.
So far, I may be wrong, but you seem to have a bit of a happy go lucky attitude towards renting... You need to put your business socks on and get straight. Becoming a landlord is not for the faint of heart. Just a cursory stroll through some of the landlord forums/boards and you'll uncover the holy hell that renting can become if you're not fully prepared. But being fully prepared and protected and ensuring your tenants are aware that you are fully prepared while also ensuring you make your tenants aware of their own rights (and non-rights) will go a long way to keeping everything just fine.
Feel free to ask any questions, happy to help!