What to Include in a Rental Agreement

The terms landlords and tenants agree to abide by in their renting arrangement are outlined in a lease or rental agreement. It’s a binding legal agreement and highly useful as it contains all the essential business information, including the duration of the tenant’s occupancy of the property and the monthly fee owed. 

The basic parameters of the tenancy must be covered by the lease to protect both the tenant and landlord. What’s more, the lease should be in writing. The following are some of the most crucial provisions listed to include in your lease or rental agreement.

All Tenants’ and Occupants’ Names

All those residing on the property, including individuals in a married or civil partnership, should be included as tenants and need to sign a lease or rental agreement. Having all adult inhabitants sign a lease gives landlords more insurance should an issue occur.

Each tenant shall pay the rent in full and comply with the lease provisions. As a result, if one renter vacates the property without paying the rent, you may legally demand payment from the remaining tenants. Additionally, you have the authority to evict all renters, not just the offender, if they break the lease or rental agreement terms.

tenant in white shirt signing a lease agreement in front of property manager

It’s also a good idea to include an occupancy provision that specifies that only the renters and their minor children are permitted to dwell in the rental and that visitors are only permitted for a predetermined number of days. This will protect you if a renter brings in an unapproved roommate or sublets the apartment without your permission.

Rent Policies 

The timing, method, and location of rent payments are some of the most crucial aspects to include in a rental agreement. You must list the exact amount of rent you’re charging and the due date. Rent is always best paid at the beginning of the month. The cost of your rent is influenced by your property’s location, value, and rental amenities. 

To determine what you might be able to charge, it’s crucial to look at the local rental market. Setting fair market rent guarantees that your rental is priced competitively to draw tenants while also increasing your revenue. To find out how much rent is being charged, look at nearby, like-kind properties. 

In addition to the rent price and payment deadline, it’s good to list the accepted payment methods as well as any penalties for late or missed payments.

Fees and Deposits

By collecting a security deposit, you’ll have a monetary safety net on hand if the tenant damages the home. You can use the security deposit to cover repair costs for damages that go beyond normal wear and tear. A security deposit can also motivate your tenants to maintain the apartment, so they can receive their money back at the end of the tenancy.

person holding a wad of cash

Remember to also account for any additional charges and deposits, including parking fees, key deposits or replacement costs, and pet deposits in your lease agreement. If the tenant refuses to pay any fees, you’ll want to be able to refer to the agreement. Finally, make sure you have legal justification if you need to keep some of the deposit after they move out.

Repairs and Maintenance

Regardless of how wonderful your tenants are, something will break eventually, and your agreement needs to spell out who is responsible for what kind of repairs. Answer the following questions in your lease:

  • Do tenants have to provide notice to the landlord or a maintenance worker? 
  • Who will bear the financial burden of the repairs? 
  • What time frame can tenants expect repairs to be completed?

Additionally, routine property inspections and maintenance are crucial. Therefore, in the lease make it clear who is responsible for kinds of maintenance and cleaning tasks. Doing so will help keep your rental in good condition and ensure that everyone is doing their part.

Duration of Tenancy

There are different kinds of lease agreements. That said, whether it be for one month, six months, a year, or longer, a fixed-term lease is one that starts and finishes on a certain date. A new contract will be required to include those details and the new dates after the lease ends.

lease agreement document with a pen and signature on it

A periodic-term lease, on the other hand, is one that lasts until the tenant or landlord provides the other party written notice that it’s terminating. Indicate in your rental agreement exactly what your terms are, how long your lease will last, and whether it may be renewed. 

Additional Rules and Clauses

It’s a good idea to include behavior clauses and other guidelines if you’re a landlord renting out a property. For instance, state certain “Quiet Hours” during which tenants must refrain from making excessive noise in order to prevent future issues of noise complaints. 

If you include a clause like this, you should define “extreme noise”, and specify what constitutes it and how to reduce noise levels. Explain in detail what occurs after the first, second, and subsequent infractions and the fees and actions taken if tenants violate these regulations. Give your new tenants a move-in package that includes useful information in addition to the rules they’re expected to abide by during their tenancy.

Bottom Line

Crafted a detailed lease agreement will protect you, your tenants, and your property. Ensure that all signing parties have read and understand the terms as this will prevent disputes or confusion. If you would like help leasing your rentals or managing them, contact Home Choice Property Management. 

We have been in the real estate industry for more than ten years and have assisted countless landlords with maintaining their rental properties. Our business provides clients with full-service property management solutions. 

We will work together to ensure you receive excellent returns on your investments without having to deal with the burden of managing a rental on your own. Our real estate and property management team have years of practical industry experience. We’ll see to it that everything is taken care of for you, your tenants, and your properties. Contact us today to learn more!