Once a landlord has properly screened their tenant and accepted their application, then its time to sign the lease agreement.
As a landlord, it is your responsibility to ensure that the policies and disclosures in the lease agreement are clear. The rights and responsibilities of both you and the tenant must be included.
Keep reading to learn more about how to craft a solid lease agreement for your rental property.
How to Create a Lease
Landlords can create a lease by:
Opting for a DIY method: This may be cost-free but it involves plenty of research to make sure that you adhere to the current state laws and local regulations.
Engaging an attorney’s services: This eliminates risks and protects you legally, but it requires paying a hefty fee.
Copying from a template: This is a hassle-free option but the general terms and conditions outlined can apply to several rental properties.
If you want a specific and legally compliant lease agreement, it’s advisable to hire a property management company, such as Property Specialists. Aside from the full suite of services that we provide, the terms of the lease will also be specific to your rental property.
Why a Lease Agreement Is Important
As a landlord, you want to avoid any potential disputes between you and your tenant to help ensure stress-free, long-term tenancies. When you have a lease agreement, it minimizes confusion and informs you about what is expected from the tenant and how they should proceed in every situation.
Best of all, if any charges are filed against you by a tenant, the court deems the lease agreement an acceptable piece of evidence.
What Are the Basics of a Lease
Though each lease agreement may differ in terms and conditions, the basic information remains the same. It should contain the following details:
Name of the landlord and tenant/s: Both the full names of the parties to the contract must be written down in the lease.
Rental property name and address: The complete name and address of the rental property must be part of the lease agreement. This includes door numbers if you manage an apartment unit.
Rental amount: Write out the rental amount both in figures and words. You should also include any other rental fees in a different clause of the lease.
Rental term: Mention the entire duration of the rental period. For example, the tenancy begins on January 1, 2023, and ends on December 31, 2023.
Signatures of the parties: Both the landlord and tenant must write their signatures to ensure the lease agreement is valid and legally binding.
What Are the Clauses and Policies To Include in a Lease
Here are some typical clauses included in lease agreements:
Subletting
Some landlords may allow tenants to split their rent by subletting the property. When you have a subletting policy, it is recommended to ask renters to submit written approval first with the other renter’s contact information.
This enables you to carry out a screening process for the additional renters first before allowing subletting.
Tenant Obligations
Landlords have many property maintenance tasks to fulfill. However, tenants must also do their share of rental maintenance, according to landlord-tenant law.
As such, the lease should outline the maintenance duties of the renter.
Breaking Of the Lease
Rental laws allow leases to be broken under specific conditions, such as required military duty, domestic violence situations, and landlord harassment cases.
If you want to allow the lease to be broken for other situations, such as a job relocation, make sure that this is stated in the leasing agreement.
Security Deposit
Different states have varying guidelines when it comes to handling a renter’s security deposit. Some may require landlords to report where the deposit is stored and the interest rate earnings.
Landlords should be detailed on the refund process for the security deposit on the lease to prevent misunderstandings.
Property Access
Landlords can only enter the rental space for specific periods and they must provide notice before accessing the property the carry out an inspection or for repairs or maintenance.
The notice period differs in different states. However, a notice of 24 hours is generally acceptable.
What Are the Required Disclosures
Landlords need to comply with state and local laws by providing the following disclosures to tenants:
– The presence of bed bugs or any pests
– The presence of radon gas since it can affect the health of the tenants.
– If an area is categorized as a flood zone, then the renter must be aware of this.
– If a property was built prior to 1978, it may have been exposed to lead-based paint.
Bottom Line
A solid lease agreement can prevent confusion and clarify expectations. A clear agreement also helps to create a positive landlord-tenant relationship.
Not all landlords have the time to draft a lease and study their state’s rental laws. A great option to consider is to hire a trusted property management company, such as Property Specialists.
Our property managers are experts on all local and state laws and can help you create a thorough lease agreement for your rental property. Contact us today to learn more about our reliable property management services!
