Residential Lease

Either party can be assigned the responsibility to obtain and pay for casualty insurance on the property and its contents. In residential leases where the tenant occupies only one apartment in the building, it is common for the landlord to insure the building and the tenant to insure his or her belongings (if desired). If the tenant occupies an entire building however, the tenant may be required to maintain the insurance coverage at levels specified by the landlord, and to name the landlord as an "additional insured." In any event where the tenant must supply the insurance, the landlord should be provided with proof of insurance and a commitment from the insurance company to notify the landlord prior to any lapse of coverage.

State laws vary widely regarding the number of days that a Tenant will have to correct (or cure) a default after receiving notice of such default from the Landlord. Further, some states provide different periods to cure depending on the type of default, distinguishing between the failure to pay rent on time and all other defaults. For example, a Landlord may be entitled to take repossession of an apartment seven days after notifying the Tenant about missing a rent payment, but may have to wait 30 days if the complaint involves the Tenant's failure to keep the Premises clean. It is highly advisable that you check with your local housing authority about the length of time that must pass before taking steps to regain possession after serving any notice of default.

Federal regulations require that Landlords who lease residential property built prior to 1978 must disclose to the potential Tenant any information known to the Landlord about lead paint hazards on the property, including any inspection reports. The Landlord must also give the potential Tenant the Environmental Protection Agency's (EPA) pamphlet entitled "Protect Your Family From Lead In Your Home." Some types of rental property are exempt from this rule. These include short-term leases (less than 100 days), renewals of leases for which disclosure has already occurred, and leases of housing previously inspected and found to be free from lead-based paint. Because the purpose of the rule is to protect children from exposure to lead, the rule also does not apply to leases of housing for the elderly (unless children under six are expected to reside there), or properties in which the living area is not separated from the sleeping area (for example, efficiencies, lofts and dormitories).

It is important to note that this regulation does not require the Landlord to have the property inspected, but only to disclose any information already known. Similar disclosure obligations apply to persons selling a home. In fact, sellers are required to give purchasers a ten-day opportunity to conduct an inspection of the property, at the purchaser's option and cost.

Our lease provides the required disclosure form at the end of this document regarding the Landlord's knowledge of lead paint hazards on the property. In addition to this disclosure form, the Landlord must provide the potential Tenant with the EPA pamphlet described above. This pamphlet may be obtained by contacting the National Lead Information Clearinghouse (NLIC) using any of the following methods:

PHONE 1-(800)-424-LEAD

FAX 1-(301)-585-7976

INTERNET www.epa.gov

The disclosure statement and EPA pamphlet must be provided to each potential Tenant and each renewing Tenant, but not to existing Tenants. In fact, these obligations also apply to Tenants who sublease the property to yet a third party. Landlords (and subleasing Tenants) who fail to comply with this regulation can face civil and criminal penalties including, potentially, triple damages.

The Landlord, Tenant and any Agent involved in the Lease are required to sign the acknowledgment at the end of the disclosure form. The Federal regulations require that the Landlord must keep the signed acknowledgment form for at least three years as proof of compliance with the rules.

You are certainly not required to rent the property to the first person who expresses an interest in the rental unit. However, your reason for refusing to rent must be based on a permissible factor. (The purpose of the rental application process is to determine, through permissible factors, whether a prospective tenant is acceptable.)

You must not discriminate against an applicant on the basis of an illegal characteristic: race, color, religion, sex, national origin, age or disability. Such discrimination, IF IT IS THE SOLE BASIS FOR YOUR REFUSAL TO RENT, is illegal throughout the United States. You may call the U.S. Department of Housing and Urban Development (HUD) at 1-800-343-3442 to ask questions about discrimination.

Additional Classes of Protection from Discrimination
State laws and/or local ordinances may establish additional characteristics which are protected from discrimination, such as marital status, sexual orientation, source of income, family responsibilities, or student status. Call your state's consumer protection office or the local department of housing to determine if any of these characteristics are protected in your locale.

Establish your Standards
You MAY discriminate based on a tenant's ability to pay, whether the Tenant has pets or waterbeds, the number of occupants, or the Tenant's honesty and permanence, as long as these criteria are applied uniformly to all applicants. Establish your standards for a particular rental unit in advance. For example, you may decide that the Tenant must meet all of the following criteria:

Gross income: At least four times rental amount

Employment: At least six months in current position

Credit: No negative reports

Rent: No late payments to prior landlord

Pets: None

Smoking: No

Waterbed: One queen size or less

Vehicles: Two or less

References: Two good personal references

Occupants: Three or less

Permanency: At least one year in each of the last two rental units

Appearance: Clean; average apparel

A lease should include provisions that: (i) make it clear that the document contains the entire agreement of the parties, (ii) require any changes to the agreement to be in writing, signed by both parties, (iii) preserve the remainder of the agreement if one of its provisions is unenforceable, (iv) make it clear that the rights of the parties are cumulative (can use all rights) rather than exclusive (limited to the right that is exercised first), and (v) specify which state's laws will govern any dispute between the parties. This program designates the state where the leased property is located as the state whose laws will govern the lease.

If a Tenant continues to live on the property after the Lease term, the Landlord is entitled to collect rent for that period. The rental amount usually stays the same. However, some states allow the Landlord to increase the rent. For example, Florida law allows the Lease to provide for double rent (200% of the Tenant's current rental payment) during the holdover period.

If a Landlord does not want to continue leasing the property to the holdover tenant, the Landlord should immediately begin the state-specified eviction procedures. A delay could result in the creation of a new lease for an implied term, such as month-to-month. Consult with a lawyer about the eviction process in your state.

Although the Landlord's exact responsibilities may vary from state to state, the Tenant can expect the Landlord to perform certain responsibilities that are imposed by state or local law. These responsibilities may be voluntarily increased or clarified by the terms of the lease agreement, but cannot be escaped. For example, the Landlord generally must provide the Tenant with "quiet enjoyment" of the property, and maintain safe and healthy living conditions (in the areas under the Landlord's control). The Landlord must also ensure that the property complies with all health and safety building codes, must keep the premises in good repair, must maintain all electrical, plumbing, and heating facilities (if such services are supplied by the Landlord), must keep all common areas safe and clean, and usually must provide adequate heat, running water, and trash collection services.

Virtually every state prohibits the Landlord from escaping these basic responsibilities, despite the Landlord's attempts to do so by inserting escape language in the lease agreement. Any such lease provisions are usually unenforceable. Furthermore, the Tenant may have the right to withhold rent and/or to "repair-and-deduct" as necessary to remedy a problem. On the other hand, it is not uncommon for the Landlord to delegate minor repair responsibilities to the Tenant, especially in a single-family dwelling lease.

The landlord is the party, usually the owner, who has legal control over the possession of certain property and who may lease such possession to another. The landlord is sometimes referred to as the "lessor."

The tenant is the party who is leasing certain property from the landlord, giving the tenant exclusive possession of the property, but subject to the terms of the lease. The tenant is sometimes referred to as the "lessee."

The agreement governing the rights and obligations of the landlord and the tenant is called a "lease."

In addition to a local attorney, there are several sources of information available to provide you with additional information about the landlord/tenant laws of your state and city.

Many cities have "housing authorities" or other governmental divisions that provide useful information. Also, some civil rights groups and agencies, low income housing groups or legal services organizations have information available to the general public related to housing needs and laws. These groups often have a broad range of experience with landlord/tenant issues and can provide both advice and information, either free of charge or at a minimal fee.

Many states have laws limiting the amount of fees that can be charged for late rental payments. For example, California and Oklahoma prohibit pre-set late fees. Massachusetts and Montana disallow late fees unless the rent is at least 30 days late. Others limit the late fee to a percentage of the rent, for example 4 percent. It is RECOMMENDED that you check with an attorney regarding the limits imposed by your state.

Each state has specific requirements that must be followed in order to properly terminate the Lease because of a default by one of the parties. Perhaps the most frequent default is the Tenant's failure to promptly pay the rent. In order to terminate the lease for nonpayment of rent, the Landlord must strictly comply with state-specific procedures, including the content and timing of required notice to the Tenant. Failure to do so may result in a delay in obtaining an eviction, and/or it may jeopardize the Landlord's right to recover rent or reimbursement for damages to the Premises.

Landlords must also be careful that their actions in terminating a lease or evicting a Tenant do not constitute retaliatory actions against the Tenant for exercising the Tenant's legal rights. For example, the Landlord may not evict the Tenant simply because the Tenant called the local housing authority regarding a safety problem on the premises. Most states have specific laws that allow Tenants to obtain money damages from Landlords who engage in retaliatory actions or presume a retaliatory motive for a period of time after the Tenant's act.

Including the legal description in the Lease identifies the exact real estate that is the subject of the Lease. For residential property it may be adequate to use a street address and/or apartment number to identify the property. For Commercial Leases, however, it may be more important to include an accurate legal description.

The legal description can be found in the legal documents (perhaps a deed or mortgage) signed when the property was purchased. The legal description may also be available from the local taxing authority responsible for real estate tax assessment and collection. Some legal descriptions are too lengthy for the space provided by this program. If that is the case, a copy of the legal description can be attached to the Lease agreement as an exhibit. The legal description should be entered EXACTLY as it appears on the deed or other legal document.

In nearly every state, the Landlord is responsible for providing the Tenant with a safe and livable residence, and thus, the Landlord has certain duties to maintain and care for the Premises. For example, it is the Landlord's obligation to make sure that the electrical wiring in an apartment complex is sound and is not a fire hazard. In order to assure that these responsibilities are met, most states prohibit the Landlord from delegating these responsibilities to the Tenant, even if the Tenant is willing to assume them. As another example, it would be inappropriate for the Landlord to shift the obligation for roof maintenance to the Tenant. The Tenant may be unable to pay for necessary repairs, and the Landlord is ultimately responsible anyway, because of the Landlord's duty to provide a livable residence. On the other hand, it is not uncommon for the Landlord to delegate minor repair responsibilities to the Tenant, especially for a single-family dwelling. Therefore, this Lease states that the Landlord has the primary responsibility to maintain the property. However, this Lease also provides the flexibility to describe certain exceptions which become the responsibility of the Tenant to maintain.

A Landlord may want include lease provisions that limit the number or type (for example, "no children") of individuals that may occupy the property. However, any such restrictions must be established with extreme caution in order to avoid violating federal, state or local housing discrimination laws regarding "family status."

Occupancy. As a general rule, occupancy cannot be limited to less than twice the number of bedrooms in the property. Any limit more restrictive than this must be supportable with a valid business reason (for example, that the size of one of the bedrooms is so small that only one adult or child could reasonably utilize it as a bedroom). In fact, if you choose to impose a limit at all, in order to be safe, it is recommended that you allow an even greater number of occupants than the number indicated by this general rule.

Children. In all but a few specific circumstances, it is a violation of federal discrimination laws to refuse to rent property to an otherwise qualified tenant simply because the tenant has children. Promoting a "quiet environment" is not an adequate rationale.

Consult the federal Department of Housing and Urban Development (HUD) and/or your state and local housing authorities before establishing occupancy and/or children restrictions.

Amount of rent: Unless the property is subject to rent control laws, there are no restrictions on the amount of rent charged. Certain cities in California, the District of Columbia, Maryland, New Jersey and New York have rent control laws.

A Pet Policy should clearly state whether no pets are allowed, or if the property is pet-friendly.

There are a number of steps that you can take to protect your legal rights as a Tenant:

1. Take photographs of any deteriorated or damaged condition of the rental property which exists prior to your occupancy.

2. Put in writing any important messages that you give to your Landlord, and keep a copy for your records. Make a written summary of all relevant telephone and in-person conversations.

3. Keep copies of all written documents pertaining to the premises.

4. Get receipts for rental payments, security deposit payments, and any other cash payments made to your Landlord, as well as a receipt for your return of the keys.

5. Have a witness available to see or hear anything that could later be the subject of dispute.

6. Keep a record of important events. For example, record when you first complained about the need for repairs.

As a Tenant, there are a number of ways you can protect your security deposit:

• Get a receipt for the deposit when it is delivered to the Landlord. The receipt should specify that it is for a rental deposit, and it should state the amount and the date that it was received.

• Prepare an inspection checklist describing any damage or deterioration that exists before you move into the premises. If possible, the Landlord should help you make the checklist so that both parties can agree on the content of the list. Rocket Lawyer provides a helpful checklist that you and your Landlord may use. Taking pictures or video footage of the property before you move in and during the inspection is also helpful to document the conditions. Make sure to date-stamp or write the date on the photos. It is also advisable to have another person present as a witness at the inspection. It would be best to have the checklist signed by both the Tenant and the Landlord (or the Landlord's agent, if the Landlord is not available). Both the Landlord and Tenant should keep a copy of the checklist for their records. When you move out, you can compare the current condition of the premises to its condition when you moved in.

• Inform the Landlord immediately of damages that occur while you are renting the premises. If possible, do this in writing. Fully explain the cause of the damages.

• Give the proper advance written notice of your intent to move out, as specified in your rental agreement or by law. Also, when you do move out, leave your forwarding address with your Landlord. In this written communication, ask for a return of your security deposit and a detailed explanation for any charges made against your security deposit.

• Leave the premises in the same or better condition as they were when you moved in. Normal wear and tear is expected and need not be restored. No charges should be made against your security deposit for normal wear and tear.

• Arrange a meeting with the Landlord at the time you move out. Go through the inspection checklist that you made when you moved onto the premises. Ask the Landlord whether you are going to be charged for any damages or cleaning so that you can take appropriate action before you leave. If the Landlord can offer no valid reason for keeping part or all of the deposit, ask to get the deposit back at this meeting.

A written lease should be prepared and signed whenever property is rented to reduce the likelihood of misunderstandings between the Tenant and the Landlord regarding the rental arrangement.

It is important for the Landlord to retain control over any remodeling or alterations to the property. If the Tenant redesigns the property in a manner that is impractical or unattractive to other potential tenants, it may be difficult to re-rent the property when the Tenant moves out. Therefore, if remodeling or improvements will be permitted at all, the Lease should require preapproval by the Landlord. Further, the Tenant should be required to restore the property to its original condition before leaving.

Furthermore, allowing a Tenant to make improvements to the property can result in "liens" against the property. For example, if a Tenant hires a contractor to install a new furnace and then fails to pay the contractor, most states authorize the contractor to file a "mechanic's lien" or "contractor's lien" against the property. A "lien" is similar to a mortgage, in that the lien holder (here, the contractor) can force the sale of the property if necessary, in order to get paid.

Therefore, if the Tenant will be allowed to make improvements, the Landlord should take appropriate steps to make sure that the contractor is paid in full. In some states, some protection can be obtained by including language in the Lease which prohibits liens caused by the Tenant, and then filing the Lease with the appropriate government office. Contact an attorney for further assistance.

Residential Leases often provide for automatic renewal of the Lease at the end of each term unless either party gives written termination notice to the other party. Most renewal clauses provide that the terms of the renewed Lease will be the same as the old Lease except that the Lease payments may be adjusted.

The Lease can also include a "holdover" clause, which automatically characterizes the Lease as a month-to-month Lease after the term expires but before the Tenant leaves. This characterization defines and limits the relationship so that the Landlord can enforce its terms.

A real estate lease is a written agreement between a Landlord and a Tenant establishing the rights and responsibilities of each party. The Landlord is the owner of real estate (also known as "premises") who rents that property to a Tenant for the Tenant's use. A "residential" lease applies to real estate used as a place for where a Tenant lives, while a "commercial" lease applies to business property.

A written lease should be prepared and signed whenever property is rented to reduce the likelihood of misunderstandings between the Tenant and the Landlord regarding the rental arrangement.

Lease Agreement and Home Rental Agreement are other names for Residential Lease.

Rocket Lawyer has designed an easy-to-use Quick Form Lease that provides you with a comprehensive set of standard lease provisions and options. Our streamlined interview process makes it easy to create the best lease agreement to suit your legal needs.

After the Tenant moves out, the Landlord is usually allowed to charge the expense of any necessary cleaning or repair of damages against the Tenant's security deposit. Depending on individual state law, the Landlord must, within a specified number of days ranging from 14 to 30, either return the entire deposit, or provide a partial return along with a written accounting of the amount withheld. However, in order for the Tenant to benefit from these Landlord requirements, the Tenant should provide the Landlord with written notice of the Tenant's forwarding address. If the Tenant fails to do so, the Landlord should nevertheless mail the deposit or the accounting to the Tenant's "last known address" (the rental property). Either the post office will forward the parcel to the Tenant, or else return it to the Landlord, which postmarked envelope is the Landlord's proof of making the attempt.

In addition, five states -- Florida, Georgia, Kentucky, Michigan and Tennessee -- require the Landlord to notify the Tenant of any proposed deductions within a specified number of days -- ranging from 3 to 30 -- after the lease terminates. The Tenant then has the right to inspect the property to verify the legitimacy of the proposed deductions.

A security deposit is an amount of money given to the Landlord by the Tenant that can be used by the Landlord for several reasons, including: (a) to make up for a Tenant's failure to pay rent, (b) to make up for rent if a Tenant leaves the property before the end of the lease term, or (c) for necessary repairs and cleaning. Most states limit the amount that can be collected to one or two months' rent. This cap may differ depending on the type of lease (more can be collected for a long-term lease, where the property is furnished, or where the Tenant will have a pet, etc.).

In addition, some states require that the security deposit be held in a separate account, and sometimes, in an interest-bearing account. A few states require that the Landlord inform the Tenant of the name of the banking institution where the funds will be held.

It is recommended that a Landlord require cash, a money order, or a cashier's check instead of a personal check for the security deposit or the first month's rent. The reason is that once the Tenant moves in (even if the Tenant only moves in a few things), the Landlord must go through the expensive and time-consuming eviction process to have the Tenant involuntarily removed. If the Tenant's security deposit check bounces, the Landlord has nothing with which to offset these costs.

In Florida, a landlord has a number of options under Florida Statute 83.49 for handling the deposit of security deposits. The Landlord can do one of the following:

• 1) Hold the funds in a separate non-interest bearing account in a Florida banking institution. The money cannot be commingled or used by the Landlord in any way until the funds are due to the Landlord due to damage or other reason;

• 2) Hold the funds in a separate interest-bearing account in a Florida banking institution for the benefit of the Tenant. The Tenant must receive and collect interest payments from the account of at least 75% of the annual average interest rate payable on the account OR interest of 5% per year;

• 3) Post a surety bond from an insurance company licenses to do business in Florida

See Florida Security Deposits for more information.

In North Carolina, a landlord is required to hold a tenant's security deposit in a separate account in a North Carolina banking institution for the benefit of the tenant, or provide a bond from an insurance company licensed to do business in North Carolina. Also, the landlord must not combine the tenant's security deposit with any other funds, or use the security deposit for any reason until the tenant actually owes the money to the landlord.

See North Carolina Security Deposits for more information.

1. The Residential Lease must be signed by both the Landlord (Lessor) and the Tenant (Lessee).

2. Landlords and Tenants must also sign the Disclosure of Lead-Based Paint. If an Agent is involved in the Lease, the Agent is also required to sign the Disclosure. Landlords must also give the Tenant the Environmental Protection Agency's pamphlet entitled "Protect Your Family From Lead In Your Home."

3. Some states require that if the Lease exceeds a specified number of years, it must be recorded in the public records, which, in turn, usually require that the document be notarized. If the original term of the Lease will extend beyond one year, review the specific requirements of your state in order to determine the need to notarize and/or record the Lease.

4. Both parties should retain a copy of the signed Lease and place them in a secure location. The Landlord is required by federal law to keep the Lead-Based Paint Disclosure statement for a minimum of three years. Both parties should also keep a copy of the inspection checklist, at least until the Tenant moves out, so that the condition of the premises at check-out can be compared to the condition at check-in.

A "sublet" or "sublease" is a Lease by a Tenant/Lessee to a third party of all or a part of the property that the Tenant/Lessee is leasing from a Landlord/Lessor. Under the Sublease, the original Tenant becomes the "Sublessor" and the new Tenant is referred to as the "Sublessee." The sublease does not release the Tenant/Sublessor from the remaining obligations of the Lease, unless the Landlord specifically releases such obligations in writing.

Obviously, the Landlord will insist on retaining some control over the selection of any Sublessee in order to prevent a complete stranger from occupying the property. Therefore, it is recommended that you include the optional Lease provision that prohibits subletting the property without the Landlord's prior written approval. This gives the Landlord the opportunity to screen and approve the prospective Sublessee.

A "subordination of lease" is consent from the Tenant that its rights to enjoy possession of the property are lower ("subordinate") in priority than the rights of a bank holding a mortgage on the leased property. The Landlord's bank usually requires this arrangement for the bank's protection. Without it, the bank might be limited in enforcing its mortgage (upon the Landlord's default) because of the Tenant's superior right of possession.

Typically, unless the Tenant is renting all of the Property, the Landlord will be responsible for the payment of all real estate taxes.

The Tenant is usually responsible for "personal taxes." These taxes are usually based on the value of personal property located on the property.

Although a tenant's responsibilities may vary by state, tenants generally must: keep their portion of the property in reasonably clean and healthy condition (including the deposit of garbage in the appropriate receptacles); not abuse or damage the building, furnishings, or appliances; not interfere with others' quiet enjoyment (including offensive noise, odors or activities); and not allow or participate in illegal activities on the property.

A "termination on sale" provision gives the Landlord the right to terminate the Lease before the end of the lease term if the leased property is sold to a third party. The new buyer may want to occupy the used the property itself, or lease the property to a different tenant. Without this provision, the property would be less valuable to the buyer because the Tenant could not be forced to leave.

Complete the sentence by entering a description of the type and number of pets allowed on the property. For example: "no more than two cats, which must be spayed or neutered.

It is important to specify which party will be responsible for each utility and/or service that benefits the property. The lease should also address how and when the utilities will be paid, and provide specific instructions if necessary. For example, "the tenant is responsible for two-thirds of the electric bill, payable to the landlord within five days after receipt of the statement from the utility company."

Some services must be supplied by the landlord, at the landlord's expense, by state law. For example, some states require that the landlord make available receptacles for garbage and other waste. Check with an attorney or a local housing authority if you have questions about what utilities or services the landlord must provide.