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What Is a Rental Lease Agreement?
A lease is a written contract that a tenant and landlord sign when a tenant rents a residential or commercial property. A rental lease agreement should outline the conditions and terms of a tenancy, which includes the obligations and rights of both the tenant(s) and the landlord.
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You can use a rental lease agreement for different types of residential properties. Examples include:
Rental lease agreements are legally binding contracts. Even if you only want to rent a room in your home to a family member or friend, you will want to have a rental lease agreement in place so that you have legal protection should disputes arise.
You may also hear rental lease agreements referred to as:
- Apartment leases
- House rental agreements
- Lease agreements
- Lease forms
- Rental agreements
- Rental contracts
- Rental tenancy agreements
- Tenancy agreements
Who Needs a Rental Lease Agreement?
A rental lease agreement will help landlords and tenants avoid disputes. If problems do arise, your signed agreement will help you resolve these issues. In addition to explaining a landlord's responsibilities and setting rules for tenants living on the property, lease agreements are often required by state laws.
Different organizations and individuals may need to use a rental lease agreement. This includes:
- Homeowners who are looking for tenants
- Tenants looking for a living space or commercial property to rent
- Individuals who want to rent their property to family members or friends
- Tenant placement services
- Property managers
- Small businesses looking for a business setting
Anyone who wants to rent out a property, including a home or room, commercial building, or land, should use a rental lease agreement. Otherwise, the landlord could:
- Lose rent money
- Be held liable for illegal activities tenants engage in on the property
- Be required to pay penalties for unpaid utility costs
- Have to spend a lot of money to deal with property damage repairs
What Should a Rental Lease Agreement Include?
A rental lease agreement should include some basic information, although many lease agreements go into more detail.
Standard lease agreements generally include:
- Contact information for the landlord
- Contact information for the tenant
Details about the property, including:
- Square footage
- Length of lease term
- Type of lease
Rent details, including:
- Amount due
- Any late fees
- Payment frequency and schedule
- Any other payment information, such as details about the security deposit
- Rental rights
- Obligations of the parties
Many standard rental lease agreements also include details about:
Any signing incentives or concessions offered to the tenant used to entice a possible tenant to rent (
here is an article
about rental concessions); this may include:
- Free rent for a set time (such as one free month of rent)
- Discounts on rental price for the full duration of the term of the lease
- Improvements to the property (such as new flooring or new appliances)
- If there is an option to purchase the property; this is sometimes referred to as rent-to-own
- Options to renew the lease
- Methods available for dispute resolution, such as arbitration and/or mediation
A comprehensive rental lease agreement offers additional options as well as more legal protections than a standard rental lease agreement would.
A comprehensive rental lease agreement may specify:
- A guarantor (a third party who agrees to cover the tenant's financial obligations should the tenant default on their rent, for example, a close friend, relative, or parent); here is an article about guarantors
- A pet fee or deposit
- An appointed property manager to act on behalf of the landlord
- If the apartment is furnished, and possibly also a description of the furnishings
- Whether or not a tenant can run a home business on the rented premises
After signing a rental lease agreement, both the landlord and tenant(s) should retain a copy of the signed document.
Types of Rental Lease Agreements
Various types and categories of rental lease agreements exist. Some categories refer to the length of time the agreement covers, while others describe the type of property rented out.
Fixed-term leases have a predetermined end date. You use this type of rental lease agreement when a tenant is agreeing to rent a property for a set amount of time and for a fixed price. Fixed-term leases use calendar dates to set the start and end date of the lease. The agreement ends based on the end date of the fixed term lease, at which point a tenant and landlord may sign a new lease that includes updated dates and other information. Alternately, the tenant can choose to move at that point.
Automatic Renewal Leases
Also referred to as periodic tenancy, this type of lease renews automatically after a set duration. For example, these types of leases may automatically renew every month, every six months, or every year. These leases continue until either the tenant or the landlord provides appropriate notice to indicate that they want to end the lease.
Month-to-Month Lease Agreements
These short-term leases are useful if a landlord doesn't want to commit to renting their property for a year or longer, but they still want to protect their rights. Month-to-month agreements offer flexibility to both landlords and tenants.
Standard Residential Rental Lease Agreements
Standard rental lease agreements can be used to rent out a residential property for a fixed period of time, usually one year. These agreements contain common essential clauses. They may differ depending on the state you are in. You can use these agreements for:
- Mobile homes
Short-Term or Vacation Rental Agreements
Individuals use these types of agreements to rent property for a short period of time, most commonly when the property is used as a vacation rental. These agreements typically are for one and 31 days. The agreement should explain rules to the guests as well as what they can expect upon arrival.
If you are renting property from another landlord, you can use a sublease agreement to rent out property or even just a room. People often choose to sublet a room or property when they need to move but don't want to break the lease. Landlords may have requirements for whether or not they accept subleases.
Room Rental Agreements
If you are renting a room on your property and want to set specific boundaries and rules, you can opt for a room rental agreement. These types of agreements are useful to put in writing how you plan to divide utility and rent payments as well as any rules for visiting guests.
Commercial Lease Agreements
If a tenant wishes to rent a property in order to operate a business, a commercial lease agreement is often the best choice. Commercial lease agreements can be used to rent:
- Industrial facilities
- Office buildings
- Retail spaces
Land Lease Agreements
Land lease agreements are used to rent a piece of land that doesn't have a property on it. Land leases may cover a variety of purposes, including:
Rent-to-Own Lease Agreements
These types of agreements give a tenant the option to purchase the property when the rental lease agreement ends. These agreements are useful for tenants who can't purchase a property immediately while allowing for the landlord/seller to keep making a steady income before the sale is complete.
Because so many intricacies exist when choosing the right type of rental lease agreement for your unique situation, it's important to work with an experienced rental agreement lawyer who can help you create an agreement that provides adequate protections.
Meet some of our Rental Lease Agreement Lawyers
Firm rated best ADR firm for Wisconsin and won an award for cultural innovation in dispute resolution from acquisition international magazine in 2016 and it was rated "Best of Brookfield" by Best Businesses in 2015. Attorney Maxwell C. Livingston was rated 10 best in Labor & Employment Law by American Institute of Legal Counsel and 40 Under 40 by American Society of Legal Advocates for 2016; he also won 10 Best by American Institute of Family Law Attorneys. He is licensed in Wisconsin in all state and federal courts, and in the 7th Circuit Court of Appeals, wherein he won a landmark decision in McCray v. Wielke.
Richard is a wizard at taking on bureaucracies and simply getting the job done. His clients value his straight-forward counsel and his ability to leverage a top-notch legal staff for efficient and effective results. Richard is a professional engineer, professor of law, and has been named among the top 2.5% of attorneys in Texas by the Super Lawyers®. When he is not driving results for his clients, Richard can be found with his small herd on his Texas homestead.
Experienced attorney and tax analyst with a history of working in the government and private industry. Skilled in Public Speaking, Contract Law, Corporate Governance, and Contract Negotiation. Strong professional graduate from Penn State Law.
I am an attorney admitted in NY, with over 6 years of experience drafting, reviewing and negotiating a wide array of contracts and agreements. I have experience in Sports and Entertainment, Real Estate, Healthcare, Estate Planning and with Startup Companies. I am confident I can assist you with all of your legal needs.
Rishma D. Eckert, Esq. is a business law attorney who primarily represents domestic and international companies and entrepreneurs. A native of both Belize and Guyana, she remains engaged with the Caribbean community in South Florida: as a Board Member and General Counsel for the Belize American Chamber of Commerce of Florida, and Member of the Guyanese American Chamber of Commerce. She holds a Bachelor of Laws degree (LL.B.) from the University of Guyana in South America, a Master’s degree in International and Comparative Law (LL.M.) from Stetson University College of Law in Gulfport, Florida, and earned a Juris Doctor degree (J.D.) from St. Thomas University School of Law in Miami, Florida. Licensed to practice in the State of Florida and the Federal Court in the Southern District of Florida, Mrs. Eckert focuses her passion and practice on domestic and international corporate structuring and incorporation, corporate governance, contract negotiation and drafting, and trademark and copyright registrations.
Mark A. Addington focuses his practice primarily on employment litigation, including contractual disputes, restrictive covenants (such as non-competition, non-solicitation, or confidential information restrictions), defense of wage and hour, harassment, retaliatory discharge, disability, age, religion, race, and sex discrimination.
Founder and Managing partner of Emerald Law, PLLC, a business law firm specializing in contract drafting and corporate transactions. Kiel worked as in house counsel for a variety of companies before launching his own firm, and most recently served as the Chief Legal Officer for an international private equity firm.