Residential Lease Agreement: A Basic Guide
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What Is a Residential Lease Agreement?
A residential lease agreement, sometimes referred to as a lease or rental agreement, is a legal contract a tenant and landlord sign when a tenant decides to rent a residential property. It outlines the terms and conditions of the tenancy, including the obligations and rights of the tenant and landlord. Tenants and landlords can use residential lease agreements for a variety of residential properties, including townhouses, duplexes, condos, houses, apartments, and more.
What Are the Landlord's and Tenant's Obligations in a Residential Lease Agreement?
The landlord's most important obligations in a residential lease agreement include:
- Giving the tenant access to the property
- Obligations to maintain or repair the structure of the property
- Allowing the tenant to enjoy the property undisturbed
On the other hand, the tenant's most important obligations in a lease agreement include:
- Paying rent on the agreed-upon date
- Not to cause damage to the property
What Does a Residential Lease Agreement Include?
The clauses included in a residential lease agreement vary depending on whether it is a standard residential lease agreement or a comprehensive lease agreement. A standard residential lease agreement typically includes the following:
- Name of the landlord and tenants: A residential lease agreement must specify the name and address of the tenant and the landlord. All tenants over the age of 18 must be named on the lease.
- Description of the property: The lease agreement should also specify the type of property being rented and its complete address, including the building or unit number, street name, town, state, and ZIP code. It should also specify any specific parking spots or storage areas as well as the areas that the tenant is not allowed to access.
- Term of the lease: This refers to the date the residential lease agreement is valid for, including the tenancy length, the start date, and the expiration date. Many yearly leases automatically convert to monthly leases once the original lease term ends.
- Rent amount and due date: The lease agreement must specify how much and when rent is due. It must indicate the full amount of rent due over the period of the entire lease and the amount due per month. It must also specify acceptable payment methods, whether the landlord charges a late payment fee, and grace period (if any).
- Security deposit terms: The lease agreement must also specify a security deposit clause, which includes the amount of security deposit collected, the date the security deposit was collected, interest rate, name and address of the bank where the security deposit is held, reasons deductions can be taken from the deposit, and the procedures for issuing a refund.
- Repair and maintenance policies: The agreement should also clearly explain the repair and maintenance policies, including the tenant's responsibility to maintain sanitary and clean premises and to pay for any damage they cause, a requirement that the tenant notifies the landlord about dangerous or defective conditions, and restrictions on tenant alterations and repairs.
In addition to the clauses in a standard residential lease agreement, a comprehensive residential lease agreement can specify whether or not the property is furnished, appoint a property manager who acts on behalf of the landlord, and state whether or not the tenant can operate a home business on the premises. This type of residential lease agreement also allows the landlord to include a pet fee or deposit and includes information about a guarantor or surety. A guarantor is someone, such as the tenant's parent or close friend, who agrees to pay the rent if the tenant defaults on rent.
Here's an article that shares a few other essential clauses in a residential lease agreement.
Lease Agreement Templates
Who Can Live in the Property Under a Residential Lease Agreement?
Only the tenant and the people listed as occupants can live in the property. The difference between a tenant and an occupant is that a tenant is a person who signs a lease agreement, while an occupant is a person who lives in the property with a landlord's permission but doesn't have the same obligations and rights as a tenant. For example, an occupant is not legally required to contribute to a security deposit or pay rent but a tenant would.
Occupants can be both children and adults. Children adopted or born while the tenant lives in the property are automatically listed to lease as occupants. However, any state may limit the number of occupants/tenants in the property if that number violates safety or health regulations for housing. These regulations vary from one state to another.
Does a Residential Lease Agreement Have to be Notarized?
A residential lease agreement doesn't have to be notarized because a lease is usually considered a short-term contract. Lease terms are usually month to month, six months, or one year in length.
Some states consider leases that exceed one year to be long-term leases. In this case, the residential lease agreement has to be notarized. It doesn't usually cost much money to notarize a residential lease agreement.
If you want to learn more about how much you can expect to pay in notary fees, head to this article .
What Happens When a Residential Lease Agreement Ends?
If a tenant chooses a periodic term lease, the lease will automatically renew with the same terms and conditions as the initial lease, unless the landlord made some changes using the required notice period. Even after the initial lease period, notice from either the landlord or the tenant is required to end the lease agreement.
If a tenant chooses a fixed-term lease, however, the lease agreement between the tenant and landlord may continue if both parties agree. In some states, a fixed residential lease automatically becomes a periodic term residential lease. In other states, the fixed-term lease may become a "tenancy at sufferance" or a "tenancy at will" when it ends, which only lasts as long as the tenant and landlord want it to. This type of residential lease term usually occurs after an expired residential lease agreement and doesn't have as much legal protection as an unexpired residential lease.
If a tenant decides to terminate all rights under a fixed-term residential lease agreement as soon as it expires, they should serve notice before the end of the lease term, in accordance with their local requirements.
Image via Flickr by stu_spivack
What Happens If a Tenant Decides to End a Fixed-Term Tenancy?
If a tenant agreed to a fixed-term tenancy, they have to pay the rent during that period. If the tenant leaves the property before the term of the contract ends, they're still responsible to pay the rent for the entire length of the lease. However, if the landlord is able to re-rent the property before the end of the lease of the breaching tenant, they may no longer require the breaching tenant to pay rent. Landlords are not allowed to collect double rent, even if the previous tenant has left.
What Happens If a Tenant Violates a Term of the Residential Lease Agreement?
If the tenant breaches a term of the residential lease agreement, they're responsible for correcting it. This may involve paying money to repair any damages that the tenant or their guests may have caused. If they don't voluntarily pay to correct the breach, such as making a payment or repair, they can be evicted by the landlord or possibly face a lawsuit for damages sustained as a result of the breach.
If you are a landlord preparing to lease residential property, a residential lease agreement can provide important protections. When you are drafting a residential lease agreement, consult with a lawyer to make sure your document includes all necessary aspects.
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Eugene S.
I have experience with the protection and monetization of intellectual property, negotiating license agreements that have earned several hundred thousand dollars in revenue, and I have negotiated multiple multi-million dollar agreements. Additionally, I have worked with various client to incorporate intellectual property strategies into their underlying business plans. I have been working remotely for over seven years and I have a home office dedicated to my work. I am available to travel to clients on an as needed basis. I enjoy working with clients in this manner because the costs are reduced, and I have the freedom to travel to my clients as needed.
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"I had a great experience working with Zachary through Contracts Counsel. He was extremely efficient in reviewing my lease agreements and provided thoughtful, clear feedback that helped tighten up the legal language. Thanks to his expertise, I now have a solid, reusable lease I feel confident sharing with future tenants. He was responsive, professional, and easy to work with — highly recommend him for any contract or lease review needs!"
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Landlord Tenant
Residential Lease Agreement
Washington
Residential lease agreement for short-term rentals?
I am a homeowner in the state of California who is considering renting out my house on a short-term basis. I am interested in understanding the legal implications of such an arrangement, particularly in regards to the lease agreement that would need to be drafted. I would like to know what provisions I should include in the lease agreement to protect my interests and ensure that I am compliant with the law.
Merry K.
I think you need to post this as a CA question, not as a WA question. However, your first step is checking government and HOA rules, if any and make sure that this is allowed. You will need to change your insurance and possibly add another policy specifically for short term rentals. Let me know if I can ever be of help with WA State legal questions!
Landlord Tenant
Residential Lease Agreement
North Carolina
Insurance in a residential lease agreement?
I am a tenant who is about to sign a residential lease agreement with a landlord. I am concerned about the insurance requirements of the agreement and what type of insurance coverage the landlord and tenant are responsible for. I want to make sure that I am adequately covered in case of any accidents or damages that may occur during my tenancy.
N'kia N.
North Carolina does not require a residential landlord to maintain landlord insurance and does not require a residential tenant to maintain tenant ("renter's") insurance. However, when a residential lease agreement requires a tenant to carry renter's insurance, it will specify the minimum amount of coverage required. Generally speaking, landlord insurance covers a landlord and tenant ("renter's") insurance covers a tenant. For example, landlord insurance is likely to cover a tenant's injuries or damages related to the landlord's negligence but is not likely to cover the tenant for more general liability purposes. Ultimately, a tenant is responsible for maintaining the minimum amount of renter's insurance required by the residential lease agreement. Otherwise, the tenant may be liable for violating the lease. However, a tenant may choose to maintain renter's insurance with more coverage than required. Exactly how much coverage a tenant needs will depend on that tenant's specific circumstances.
Eviction
Residential Lease Agreement
Florida
Ending a residential lease agreement early?
I recently entered into a residential lease agreement for an apartment in my city. However, due to unforeseen circumstances, I am now in need of terminating my lease early. I am looking for advice on the best way to proceed in order to ensure that I am not held liable for any costs or fees associated with ending the lease early.
Linda W.
It is entirely the landlords decision as to whether to allow you to terminate early. If only because you want to move to another location and there’s nothing wrong with the unit. There are some possibilities of a substitution of a tenant that perhaps the landlord would agree to. Or if fourth of a part of your deposit, assuming you made one… There are a variety of ways to approach this, but ultimately is the choice of the landlord.
Landlord Tenant
Residential Lease Agreement
Indiana
Can a landlord in Indianapolis record video and audio without telling the tenant?
I rent a room in a house. Landlord ./owner oesnt live here. A week ago he installed cameras in the living room and kitchen. They don't cover exterior doors. He said nothing to me but I see them. Not hidden. Tonight I found out he can talk to me and hear me through them. Is this legai? What should I do?
Joseph B.
The question would be what exactly do you rent. Do you rent a room and the kitchen and livingroom are common areas or do you rent the entire space. You have an expectation of privacy inside the space you rent. So, for example, if you rent a single room, you have an expectation of privacy inside that room, and thus there is no expectation of privacy in the common areas. However, if you rent the entire space, then the area for your expectation of privacy is the entire unit. This does not apply to bathrooms or changing rooms or other areas where there is also a general expectation of privacy.
Landlord Tenant
Residential Lease Agreement
Florida
Length of a standard residential lease agreement?
I am in the process of looking for a new place to rent and want to make sure I understand my rights as a tenant. I am looking to sign a residential lease agreement and was wondering what the standard length of the agreement is so I can plan accordingly. I want to make sure I am aware of any potential pitfalls or issues that may arise from signing a long-term lease.
Linda W.
Being a landlord myself, and haven’t been involved in numerous residential landlord/tenant proceedings, my experience is that most residential leases are for one year. However, that being said we do live in Florida, and there are a lot of people who come down here just for the winter, which therefore involves shorter term leases. And if it is a condominium, the minimum length of time is determined by the condominium documents. If it is a home in a community, it would be covered by the HOA documents. Freestanding homes are limitless.
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