Managing Tenants

10 Terms Your Lease Agreement Should Define

| 1 min. read

Your lease agreement sets the tone for your relationship with your tenants, acting as both a legal contract and a point of reference. As such, it's vital for it to be as specific and exhaustive as possible. Always make sure that each component of your lease agreement is in line with your state's regulations, and of course, run it past your lawyer before implementing it.

10 Recommendations for a Strong Lease Agreement

  1. Lay out the terms of tenancy: Is it a self-renewing, month-to-month lease agreement or a fixed-term, year-long lease agreement? What are the lease agreement's start and end dates? In addition, be sure to list the property's address and unit number.
  2. Set rules for rent payments: Specify the amount, the due date, and the format (e.g. a mailed check or an online payment). In addition, your lease agreement should spell out regulations regarding bounced checks and late fees (e.g. how much you charge and when a payment is considered late).
  3. Set the terms for deposits and fees: How much is your security deposit? What are the terms of its use (e.g. the landlord can use it for damage repair; the tenant can't apply it toward their rent)? When and how will the security deposit be returned at the end of the lease? Do you charge any non-returnable fees (e.g. for pets or cleaning)? Where is the deposit being held, and are you obligated to return the interest that it generates? (Check the legal requirements for your state.)
  4. Include each tenant's name: If a couple is renting your unit, both of their names should be on the lease agreement. Each tenant whose name is on the lease agreement can be held accountable for paying rent or violating the terms of your agreement. However, minor children are exceptions.
  5. Impose limits on occupancy: Be clear that the unit's only legal residents are those adults whose names are on the lease agreement, plus any minor children. This gives you the right to evict any additional residents that you didn't approve. Include a subletting clause that requires the tenant to obtain your written permission for someone else take over their lease agreement. (You can also forbid subletting altogether.)
  6. Assign maintenance and repair duties: Your lease agreement should specify that it's the tenant's job to keep the unit in good shape, and that they're responsible for any damage that they cause. Require the tenant to alert you to hazardous or defective conditions, and lay out your procedures for responding to complaints and requests. Forbid the tenant from making alterations to the unit or changing the locks without your written permission. In addition, your lease agreement should specify who's responsible for utilities.
  7. Clarify your access rights: Make the tenant aware that you have a legal right to enter the unit under certain conditions (e.g. for repairs, inspections, or emergencies), and that you'll give them a certain amount of advance notice before your visit.
  8. Lay out rules for pet owners: Indicate requirements such as requiring spaying/neutering, vaccinations, and immediate waste disposal in common areas. Your lease agreement should also require owners to pay a refundable pet deposit and let you approve each pet individually.
  9. Restrict illicit behaviors: Your goal here is to keep all of your residents happy, prevent property damage, and protect yourself from lawsuits. As such, your lease agreement should prohibit disruptive behavior (e.g. excessive noise) and illegal activity (e.g. drug dealing). Specify any other restrictions, from parking rules to the use of common areas.
Robin Young
Robin Young is the Senior Content Writer and Managing Editor for the All Property Management Blog and Buildium Blog. She cut her teeth as a marketing copywriter at Wayfair and TechTarget, and she spends her free time perfecting her lifestyle blog, Feather & Flint. She holds degrees in psychology, sociology, and songwriting.
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