Renting your first place with a roommate or paying rent on your own for the first time means you need to submit a rental application to rent a residential property. Once a landlord accepts your rental application, you’ll review and sign an apartment lease agreement.
Understanding the terms of a rental lease agreement is important for both the landlord and tenant. Legally binding contracts are not something a property owner or property management company takes lightly.
It’s important for both the tenant and property manager to understand what’s included in an apartment lease agreement before it’s signed.
The lease agreement also protects both parties since the terms can’t change once it gets signed. The landlord can’t change the monthly rent amount or add a pet fee if the lease doesn’t include a pet policy.
What is a rental lease agreement?
A lease agreement is a legally binding contract between the landlord and tenant for a particular piece of real estate. It outlines the rules agreed upon by both the landlord and the tenant in clear lease terms. The lease agreement includes important details, including the type of real estate, monthly rent amount and the lease term.
A security deposit is part of lease agreements, even in a month-to-month lease agreement. Sometimes, house rules include a pet policy not allowing pets or no smoking allowed in the unit or on the real estate property. These house rules should be in the lease agreement so there are no misunderstandings.
Verbal agreements are difficult to enforce. Anything discussed should be in the final rental or lease agreement. A verbal agreement is useless if one of the parties forgets what they said or flat out denies it.
If a landlord doesn’t offer an apartment lease agreement, a tenant could ask for one.
Types of leases in a rental agreement
There are many lease agreements available when someone rents a property.
Most fixed-term lease agreements include a lease period of 12 months. A month-to-month rental lease agreement is not uncommon. Each rental lease agreement includes how much rent the tenant pays each month and when the monthly rent amount is due. It also notes the security deposit amount, whether there’s a pet deposit and the lease end date.
It also includes other details, such as who is responsible for utilities, property maintenance, property repairs and whether parking is available as part of the real estate to those who pay rent or if it’s included in the monthly rent.
Legal terms, monthly rent details and other things in an apartment lease agreement
A lease agreement is a legally binding contract. Take the time to read it so you know what you’re renting, what you can do on the property and what you can’t.
While many are standard agreements, each rental agreement should outline, for example, how much advance notice you need to provide should the lease end date need to change or what the pet policy is for the rental properties.
Governing law refers to the state laws that govern the lease. In most cities, standard residential leases are governed by and construed in accordance with state laws.
It’s important to review the rental lease agreement closely as it outlines what is considered normal wear and tear.
For example, if a tenant decides to paint the whole apartment or remove blinds and put in curtains and there’s no written consent as part of the lease terms, the security deposit may not be returned if the rental property manager needs to pay to have the unit repainted or add blinds.
What each section means in a sample lease
Lease agreements are pretty standard but it’s good to note what each should include. Here are what each section means in a sample lease.
Property details
The rental lease agreement should include basic facts about the rental property. Each agreement includes the address, landlord or property manager’s name and contact information. It notes when the lease begins and ends, the monthly rent amount and what the monthly rent includes, such as appliances and parking.
Payments, deposits, lease termination, late fees
In addition to how much rent is expected every month, the lease agreement should make it clear when each month’s rent is due by and what, if any, late fees can be expected if you pay rent late. If you have a roommate, what might happen should one of you need to end the lease early?
Does the lease agreement note you’ll need to provide the first month’s rent and last month’s rent and a security deposit?
If a security deposit is due upon the signing of the lease, how is it handled upon lease termination? What’s considered normal wear and tear and what will be covered by a security deposit?
How much advance notice does a tenant need to give a landlord of their intent not to renew a lease once the lease expires or once the landlord lets the tenant know the monthly rent amount will increase? It should note the monthly rental rate does not increase during the fixed period of the lease.
Resigning or breaking your lease
Life happens, a new job opportunity in another city presents itself or something happens in which you need to break your lease. There are things your landlord will appreciate as part of a good landlord-tenant relationship.
It’s a good idea to review the details of the agreement, including what kind of advance notice you must give. There could be many reasons why you may have to break your lease. It’s important to know what’s at stake if you have to break a lease. You could lose your security deposit and your last month’s rent. You could also be responsible for finding someone to sublet your apartment or need to pay each month’s rent until your lease ends.
Include everything in writing to save time and money
Renting a new apartment can be a fun experience. Knowing the terms of your new home by reviewing the lease agreement can save both time and headaches in the short and long term. Having this legally binding agreement can help avoid misunderstandings, too.
