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How to Write a Rental Agreement?

How to Write a Rental Agreement?

This is a question that most landlords and to-be- Landlords often ask. Many people want to make money out of their unused properties or extra space, yet do not know how to make agreements or how to start. Let’s start off with defining what a Rental Agreement is.

What is a rental agreement?

A rental agreement is a written document signed by both land lord and tenants, and is notarized by a lawyer. The rental agreement gives a tenant the right to lease a certain place for the agreed period of time. It could be a long-term agreement which could last for a year or more, or  a short-term lease. For short term agreements, sometimes both landlord and tenant have an oral agreement upon leasing the property to the tenant. But for protection of both tenants ang property owners, a notarized written rental agreement would be the best option.

What are the differences between oral and written Rental Agreement?

Oral leases have no written documents stating how much the tenant will pay for the rental, or how long is the agreed time that the tenant will occupy the leased properties, and the period of time agreed prior to giving a tenant to vacate. While a written agreement is a documented formal rental agreement that states all the terms and conditions of the lease contract. It states the period of time that a tenant will stay in the properties, the amount of time notice must be given for the tenant to vacate, how much the tenant is bound to pay and the terms of payment. A written agreement is more desirable and what most tenant and landlords prefer because disputes can be easily settled by referring to the lease.

What should a rental agreement include?

There are important key terms and points that a written rental agreement or lease should include, such as the following :

  • The names of both the property owner or landlord  and the tenant.
  • The complete address of the rental unit.
  • The specific amount of the agreed rent.
  • The due date of the rent, to whom it is to be paid, the type of payments accepted, and where it is to be paid.
  • The amount and purpose of the advance and security deposit.
  • The conditions and amount of late charges, or fees just in case of returned checks.
  • The conditions on whether pets are allowed or not, or what kind and how many pets are allowed in the rented property.
  • The number of people that are allowed to live in the rented property.
  • Whether legal fees can be collected from the losing party in the event of a lawsuit between the tenant and the landlord.
  • Whether  utility bills  (gas, electric, water, and trash collection) are included or excluded in the rent.
  • If the rental property is a house or a duplex with a yard, who will be responsible for the yard maintenance.
  • Repairs, who will be responsible of paying, and if the landlords agreed to make repairs, the amount of time that repairs will be completed.
  • Agreement whether you can sublet the rental unit
  • The conditions under which the property owner, representative, or landlord can inspect the rental unit.

What should a lease or Rental Agreement never include?

The are Illegal provisions that a Rental Agreement must not include, such as the ff:

  • Exculpatory Clause: that protects the landlord or property owner from liability for his or her own negligence.
  • A provision stating excessive penalty charges for late rent and payments: A penalty for late rent payments may not be larger than the reasonable amount of  the expected damages.
  • A provision stating that advance payments and deposits shall be automatically forfeited in case of a tenant’s failure to pay or follow the agreement. The property owner may only keep the advance payments and security deposit to pay for damages to the rental unit
  • A provision stating that the tenant would play the guilty part in the event of a dispute.
  • A property owner may not prohibit the use of waterbeds, unless otherwise the local building code requires, though the tenant must always carry insurance for damage protection.
  • A provision stating that the tenant shall agree to pay all of property owner’s attorney fees in the cases of a dispute. Only the court  has the power to grant the fees be paid by both parties.
Posted on January 2, 2009
Category: Uncategorized
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