What is a residential lease agreement?

A residential lease creates an agreement between a property landlord and one or more tenants that allows the tenants to occupy a residential property in exchange for payment. The agreement specifies the rights and obligations of all parties involved. It normally terminates after a fixed term, such as six months or one year. A residential lease agreement differs from a residential rental agreement in that it lasts for a fixed term. A rental agreement continues as a periodic tenancy (i.e. week to week or month to month) indefinitely until one of the parties provides notice that it wishes to terminate the agreement.

What is the difference between a lease and a rental agreement?

While some people use the terms "lease agreement" and "rental agreement" interchangeably, technically a lease agreement is used to create a fixed-term tenancy (terminating on a set date; for example after one year), while a rental agreement creates a periodic tenancy (automatically renews until one of the parties decides to terminate it; for example a month-to-month tenancy).

What is the difference between a deposit and a fee?

In the context of property leasing, deposits are normally refundable, while fees are nonrefundable one-time payments. Tenants must be notified if they are being charged a "deposit" that is nonrefundable. For instance, security deposits are meant to protect landlords against tenants not paying for any damage they cause. At the end of the tenancy, deductions may be made from the deposit as permitted by state law, and the remaining funds must be returned to the tenant. Examples of common fees include upfront fees for pets, administration costs, application processing, and cleaning fees.

What is the difference between a sublet and an assignment?

An assignment occurs when a tenant transfers its entire interest in a leased property for the remainder of the term of the lease to another party. A sublet occurs when the tenant transfers anything less than its entire interest. When an assignment occurs, tenants are normally released from all responsibility for the lease. However, it is important to note whether the terms of an assignment actually give a full release from all responsibility. Sometimes the language will keep the original tenant on the hook if the new tenant fails to pay rent or otherwise fails to fulfill its obligations. On the other hand, with a sublease, the tenant remains ultimately responsible if the subtenant fails to uphold its responsibilities. This is because, technically, there is no agreement between a landlord and a subtenant. The landlord must seek recovery against the original tenant. Often, subleases are temporary in duration, with the subtenant moving out of the property before the term of the original tenant's lease agreement expires.

What needs to be included in a lease or rental agreement?

If you search around the Internet, you will find leases and rental agreements that vary widely in terms of length, thoroughness, and format. Every state has different laws as to what must be included. However, in general, the following items must be included: The name and address of all parties involved: For residential leases, the address for the tenants will normally be the address of the unit being occupied. The term of the agreement: Agreements may be for fixed terms, such as six months or one year, or they may be periodic, such as week to week or month to month. Rental payment terms: These terms include how often rent will be paid, the payment amount, where payments may be made, and the permitted payment methods. Deposits and fees: Deposits are normally refundable whereas fees are not. The agreement should state the circumstances when the landlord may make deductions from the deposit. Utilities and maintenance responsibilities: The agreement must be clear as to who is responsible for paying each utility and should explain the maintenance and repair obligations. Prohibited uses and activities: Tenants are prohibited from engaging in illegal activities on the premises. The agreement normally includes a laundry list of specific prohibitions. Termination: The manner of terminating the agreement differs depending on the type of tenancy, preferences of the parties, and state law requirements. Disclosures: Each state has specific disclosure requirements that must be met prior to signing the lease. Most states require landlords to disclose serious problems that impact the unit's habitability and local rent control rules. If you are ever in doubt, it is best to always disclose all relevant issues.

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You are a landlord or property manager that wants to lease a property
The tenant will lease for a fixed or periodic term, such as month-to-month
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Begin by collecting basic information about the lease, including landlord and tenant addresses and contact information, when the lease will begin and end, as well as rent and security deposit amounts. Also determine at this point if any special work orders or repairs will be needed for the unit.

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Always read your document thoroughly to ensure it contains everything you need and is free of errors. In any case, once you finish creating your document, you will be able to alter it as much as you like in Microsoft Word. However, if you do not need to make any changes, you can simply download the PDF version and have the parties sign the agreement.

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