Setting rules in your rental lease is a great step toward getting your perfect agreement signed, but as any experienced landlord knows, not everything goes completely smoothly when it comes to this kind of thing. While many might be scared of these written agreements, as they can be tricky to properly craft sometimes, knowing how to write them and understand them can be of great help for your business.
Today, we’ll go over a brief guide on the lease agreement so that you, too, can better understand how it works!
What Is A Lease
A lease is a contract outlining the terms under which one party agrees to rent an asset, in this case, property owned by another party. It guarantees the lessee, also known as the tenant, use of the property and guarantees the lessor, which is the property owner or landlord, regular payments for a specified period in exchange. It’s relevant to state that both the renter and the landlord face consequences if they fail to uphold the terms of the contract.
Types Of Leases
Residential leases tend to be the same for all tenants, but there are also several different types of commercial leases out there. Beyond residential leases, tenants who lease commercial properties have a variety of lease types available, all of which are structured to assign more responsibility to the renter and provide greater up-front profit for the landlord.
A few of the most common types of leases include:
- Commercial lease: For a commercial property like offices. It’s when a business rents a commercial property to conduct business from that location.
- Family member lease: For family members leasing property. A family member lease agreement allows a person related by blood or marriage to pay rent while living in the same household.
- Condominium lease: A residential property that shares some building amenities with other tenants.
- Short-term lease: Used for short-term leases of unusual periods. They are well-suited for vacation rentals.
- Sublet lease: A lease created by the renter to add a renter. This is done with the approval of a landlord, and it requires an extra screening for the tenants who are subletting the property.
- Single net leases: In this kind of commercial lease, the tenant is responsible for paying property taxes.
- Triple-Net Leases: This is another type of commercial agreement. Tenants who sign these leases pay property taxes, insurance, and maintenance costs.
How To Customize Rules
While your lease must abide by local laws and regulations, you can still add customized rules and clauses. And knowing how to customize rules in your agreement can not only help you feel more at peace during the rental process, but you can protect yourself in case of a sudden hiccup you might run into along the way.
An example of a customizable detail on the lease is rent. You can change the collection date if requested by tenants, but this does not happen often. You have to set the rent price early in the process, and since the tenant has agreed to the amount stated in the listing, then it must be included in the lease agreement. However, there may be times when a tenant misses the due date, so you’ll need to enforce a late fee that has to be stated in your written agreement.
Another detail can be the permission of pets since whether or not you allow pets on your property is solely your decision. According to these Arizona property managers, you do need to remember that over 70% of tenants are pet owners, as studies have shown in recent years. By not allowing pets, you could significantly limit the number of tenants interested in your property.
The list can go on with how you choose to craft these details in your lease and it’s up to your preference to do so. We advise you to keep in mind what tenants are looking for and to stay up to the industry trends to attract more. Also, ask for a property manager's help while writing an agreement since they are knowledgeable in this area of expertise and can aid you in customizing the lease agreement to everyone's liking.
Lease Breaking
It’s not uncommon for renters to seek an early release from their lease agreements, and many renters do attempt the process, as either party can break a lease. But doing so isn't advisable because there can be consequences involved. Tenants may be responsible for paying the landlord early release charges or the remaining balance to pay off the lease. Breaking a lease may hurt a tenant's credit score in some cases.
It’s known that breaking any legal contract comes with inherent risks. When it comes to the lease agreement, these risks tend to be financial. The consequences of a tenant breaking a lease can also extend further into legal action and affect your business’s future.
Evictions
An eviction is the court-ordered removal of a tenant from the property where they currently reside. Landlords are required to inform tenants about the eviction with a notice that specifies the reason for it and the number of days before the proceedings begin.
After this, all parties involved in the lease agreement are subject to landlord-tenant laws. Property owners can’t usually evict tenants without good cause, but some founded reasons can include nonpayment of rent, damages, illegal activity, and violating lease terms.
Eviction laws vary by state, but the process is pretty uniform. To move forward with a proper eviction process, you need to provide evidence like photos, videos, texts, emails, and any other relevant information the court may need.
Conclusion
Lease agreements, like many other contracts, tend to intimidate some people because much of the language in the contract can be somewhat confusing. However, if you have a basic understanding of the lease agreements, it can help you avoid unnecessary issues or disputes.
Having a property manager guide you in understanding what a lease agreement is and how it works can be of great help, especially in the long run. They are experienced professionals who know exactly how to handle these agreements.
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