Agreement Templates Guides

How to Write a Rental Lease Agreement

As a landlord, there are some prerequisites you need to get out of the way, the most important being a structured rental lease agreement. In this guide, we’ll be showing you what exactly a rental lease agreement is, discussing the various types of rental lease agreements, their purpose, what they cover, and which steps you should be taking to format your own rental lease agreement.

What is a Rental Lease Agreement?

Rental lease agreements are there to help specify the rules that a landlord sets and to which a tenant agrees to follow during the term of their rental relationship. As such, rental lease agreements are legal documents that specify details such as the term of rent, rent to be paid by the tenant each month, and also contain all other essential business details about the agreement. In short: a rental lease agreement covers the basic terms of the tenancy.

Common Types of Rental Lease Agreements

While there are various types of rental lease agreements, the most common leases are:

Short-Term Agreements – Short term lease agreements usually have fixed monthly lease fees payable for the duration of the agreement. These are perfect for people looking to occupy a house for a relatively short period of time.

Month-to-Month Agreements – Month-to-month lease agreements indicate that tenants are renting their houses one month at a time. Rental prices in these agreements may change without prior notice, but if you’re not too sure on just how long you’ll be renting, these kinds of agreements may better suit your personal needs.

Subleasing – Some people refer to subleasing as subletting houses or apartments, which means that they are effectively living in a home that is being paid by another tenant. Arrangements regarding payment are usually worked out between the occupant and the original tenant and usually do not involve the landlord. Keep in mind that subleasing requires written consent from a landlord.

The Purpose of a Rental Lease Agreement

Rental lease agreements are contracts between landlords and tenants, and as such, details of responsibilities of both parties are stipulated in the contract, which helps to ensure that both parties are protected in the case of misconduct by one or the other. Rental lease agreements help ensure that landlords cannot simply change the terms of renting and tenants cannot simply move out of the property before the rental period is over without repercussions.

Elements of a Professional Rental Lease Agreement

Regardless of which type of lease agreement you’re looking to set up, you want it to look professional and more importantly, concise. There are a few basics which need to be included in every rental lease agreement. Essentially, the following five elements will form the building blocks for your successful rental lease agreement.

1. Stipulate All Parties Agreeing on the Lease

Your lease agreement has to clearly indicate who the lease will be between. Generally, the lease agreement will be between a landlord and-or his or her agent, and the tenant renting the property. You may wish to structure your lease to resemble this format:

“This Lease is between the Tenant(s)

Insert Tenant Name Here

Residing at

Insert the Rental Property’s Full Address Here

Hereafter referred to as the Tenant.”

AND the Landlord

Insert Landlord Name Here

Residing at

Insert Mailing Address of Landlord Here

Hereafter referred to as the Landlord.”

2. Identify the Property Location

You will have to identify the full address of the property being rented, which includes the house number, street name, apartment number (if applicable), town, state, postal code.

3. Include the Term of Rental Lease

In your rental lease agreement, you’ll have to include the year, month, and day on which the lease will begin as well as the exact date on which the agreement will end. You should not write terms such as “one year” or “six months” as these terms may be misleading and unclear.

4. Stipulate the Rent Due

Including the full amount of rent due by the tenant over the lease agreement’s full term is essential. After stipulating the total amount due by the tenant, you can break it down into monthly payments, indicating how much the tenant has to pay each month and a day in the month of which the rent is due. You may structure this paragraph to look something like this:

“The Tenant agrees to pay a total amount of $24,000 for rent, to be paid in increments of $2,000 per month over the duration of this contract, payable by no later than the 1st day of every month. Upon signing this Lease, the Tenant agrees to pay an advance of the first month’s rent as well as any security deposits which may be required. The Tenant agrees to pay a penalty of $40, in addition, to rent for payments that are more than three (3) days overdue.”

5. Add a Date and Signature Line

Rental lease agreements without dates and signatures are worthless. You should include a space where both parties, the landlord, and the tenant, can place their signatures, indicating that the agreement has commenced and that both parties agree to follow the terms and conditions set out in the lease agreement.

Steps to Format a Rental Lease Agreement

Here are some pointers on where to start with formatting your rental lease agreement, what should put in which paragraphs, when and where to include the terms and conditions, and how to close off the rental lease agreement.

1. Start with a title

At the top of your page, write “Rental Lease Agreement” to indicate that this is a legally binding contract.

2. Explain the title

Just under the title, identify all parties agreeing to this lease agreement. Include the name of the landlord and his address, after which you should indicate the names and address of the tenant, clearly identifying the lessee and the lessor. At this stage, you should also be including the full address of the rental property as well as a start and end date for the rental lease agreement.

3. Stipulate the rent

As your second paragraph, your rental lease agreement should account for all funds associated with the agreement. Payment information should include a total rent amount for the duration of the agreement as well as stipulations regarding when and how the funds should be paid to the landlord.

4. Mention Terms and Conditions

In the third paragraph of your rental lease agreement, you should be assigned responsibilities. Stipulate who will be in charge of paying utility bills, maintaining the exterior areas of the property, as well as any other property-specific responsibilities.

5. Summarize the tenant’s obligations under the lease agreement.

The fourth paragraph of your contract should revolve around the tenant’s responsibility for adhering to the law, that the tenant shall not misuse the property for manners other than those indicated on the contract, and that the tenant shall be held liable for all fines in the event of failing to comply with these rules. Clearly, point out that the tenant may only use the property for residential purposes. Stipulate what should be done if something on the property breaks or is stolen. Clearly, state whether or not the tenant is allowed to make any changes to the property such as painting the walls or installing cables.

6. Be clear on what happens with defaults and missed payments.

In the fifth paragraph of your rental lease agreement, you should be focusing on what will happen if the tenant violates the terms of the agreement. This could include details on action stat will be taken by the landlord should the tenant default or miss a few payments on rent, which could include remedies such as repossession eviction, and/or lawsuits.

7. Add date and signature lines.

Make sure that you include the date and signature lines at the bottom of your rental lease agreement contract to indicate how and when the contract was initiated and bound.

Do’s and Don’ts for Rental Lease Agreements

Do

  • Keep local and state laws in mind
  • Include late payment penalties
  • Stipulate who the lessee and lessor will be
  • Stipulate commencement and end dates for the rental lease agreement

Don’t

  • Use generic agreements, set up your own to include property details and special terms and conditions
  • Be vague on responsibilities
  • Forget about including house rules in the contract
  • Forget to consider and include a pet-friendliness clause in the contract

List of Lease Agreement Samples Available to Download


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