THE RENTAL AGREEMENT

THE RENTAL AGREEMENT The Rental Agreement is the contract between the landlord and the tenant. It spells out the conditions under which the tenant will rent the property. Normally covered in it are such things as the amount of rent to pay, how to treat the property, and the rental rules. Most rental agreements differ slightly from each other. Some will have one provision and not another, or vice versa. Others leave lots of blank spaces to be filled in by the landlord. Excellent forms are also available from local landlord associations. Unlike the generic rental forms purchased at stationery stores or national chain stores, the forms from rental associations are updated by attorneys and property management professionals every time a new law is passed by the legislature of the state in which you reside. Every rental agreement should have certain clauses included in it: Complete address of the property and name of landlord Name of the tenant(s) Date of commencement of the tenancy Amount of rent, when it is due, and where it is to be paid Penalties for not paying rent when due How the tenancy can be terminated Tenant responsibilities for maintaining the premises How the agreement can be changed Who pays the utilities, including the last month’s electric and water bill The forms you use may or may not include other items, but the ideas that follow will let the tenant know what you, as the landlord, expect from a tenant. It is always better to inform and/or educate in advance than to try and rectify a situation after it occurs. Pet Agreement If you allow pets on your property, this may be one of the most important forms you can use. It spells out in detail what is expected of the tenant. It also adds a deposit or fee for cleanup after the tenant moves out. Of course, you have the right to forbid or regulate pets on your property, unless the “pets” are assistance animals, such as guide dogs. Notification Procedures Tenants need to know in advance how you, the landlord, can legally serve them with any notice regarding defaults of or changes in the rental agreement. Notification procedures are extremely important. If you get them wrong, the tenant is not notified, and you have to start the process all over again. Spelling out notification procedures in advance does three things. First, it lets the tenant know the rules. Second, it lets him or her know that you know the law. Third, it gives you guidelines to follow every time you have to notify the tenant for any reason. No Extra Bodies The tenant must understand that only the people listed on the rental agreement are the people who are supposed to be living in the rental unit. You must also spell out occupancy limits. Each person to be living there must be named on the lease and limits on how long guests may stay, often something like five days, two weeks, etc. This prevents tenants from adding tenants to the unit under the guise that they are only visiting or vacationing with the signed tenant. A no sub-leasing statement is part of the “no extra bodies” clause. Smoke Detectors An acknowledgment that the smoke detectors are in good working order is similar to the provision for a statement of condition of the property in the Property Condition Report: it won’t always prevent problems, but it lets them know that you know the smoke detectors work and have batteries in them or are correctly connected when they move in. And when the landlord or property manager does routine property checks, it’s recommended to always check that battery-operated smoke detectors still have the batteries in them. Limit on number of vehicles Not much looks worse than a bunch of broken down cars in front of a house or in an apartment unit’s parking areas. It also creates hard feelings and tension with other tenants and neighbors. Be certain to detail how many cars can be parked in the unit’s driveway and/or in front of the house, or other places on the property. Tenant repairs Many landlords tell the tenant to repair anything that would cost less than $25 and send them a bill. This keeps the landlord from being called for dripping faucets and loose screws. Other landlords don’t want to leave anything to the tenant, preferring to make sure it is done correctly. The flip side is that tenants who are handy and are willing to make some of the repairs themselves can end up taking more pride in the property. Some tenants would like to make repairs, but do not have the skills sufficient to do a good job. You have to find out how capable a tenant really is before you turn him or her loose on any repair, even changing fuses. Remember, you are ultimately responsible and liable for any repairs made on a property, regardless of who did them. Yard maintenance This is especially important for single family rentals since a poorly maintained yard is much harder and more expensive to restore to attractiveness and more difficult to rerent. Ask if the tenant has a lawnmower. If not, reiterate what is expected and ask how he or she expects to keep the yard in good shape. Between the two of you, a solution can be worked out. In the summer, the yard will need to be watered. The landlord and tenant can split the additional water costs, or the landlord can shoulder the full amount. Either way, if the yard is required to be watered, the tenant must know in advance what is expected and how the cost will be covered. Things to remember A tenant set upon causing you trouble will do it, no matter what the rental agreement states. A tenant that has just not been properly schooled in what it takes to be a responsible renter but is willing to learn, will absorb the information and can become a desirable tenant. The biggest advantage of spelling out everything in writing, using special notices and forms, and reviewing them verbally, is that the tenant then understands the provisions and knows that you have set requirements, know the law, and have documentation. Make certain that your tenant gets a copy of every document and form!!! Make sure he or she is aware of the importance of keeping them in a safe place, in a file box, desk or box that is labeled “Important Documents.” If the tenant should call with a question covered by a document, you can refer to what was already agreed to and signed. If necessary, go over the provisions again. The upshot of all this detail is this: a few minutes at the beginning of each landlordtenant relationship provides a solid informational basis, instills respect, and can save denial and stress later on.