“Key Points In Making A Lease Agreement Template”
Do you have a lease agreement template?
Choosing to rent out your property is easy enough to do. If a piece of property is idle, renting it out can provide you with a monthly flow of cash. It’s a convenient and popular practice worldwide.
But when setting a property to be rented, you’ll need a lease agreement. And to do that right, you need a good lease agreement template.
A lease agreement template is crucial because you want a carefully-made lease agreement. Without one, you could end up making and signing a contract that puts you at a disadvantage.
That’s why it’s important to use a good lease agreement template. A good lease agreement template has you covered in every place that matters.
It’s also made so that you can just modify small details just to apply it to different properties you’re leasing. That’s a huge convenience if you have more than one.
But what if you don’t know where to start? Don’t worry! In this blog, I’ll help you make a good lease agreement template.
What Is a Lease Agreement Template?
Firstly, you need a better understanding of a lease agreement.
A lease agreement is a document that describes the terms under which one party (you) is renting out property to another (your tenant).
This document also outlines the rights and obligations of the tenant(s) and landlord(s), such as money exchanges and rules.
Both the landlord(s) and the tenant(s) must sign the lease agreement in order to make it legally binding. This makes both parties accountable for their actions if they disobey the terms in it.
So, what should you remember when making a lease agreement template?
General Property Information
As a form of full disclosure, every lease agreement template should have the complete billing address of the property. You can also add a description of the property, such as its name and some of its features.
If you want to add more details about the property you’ll be renting out, you have to attach a floor plan or schematic. This can be used to clear up how much rentable space your tenants can claim.
You should also include a list of furnishings or appliances that will be provided in your lease. Specifying what things are included will make it easier for each party’s property to be accounted for.
Tenant(s) and Landlord Information
Your lease agreement template should include the names of all the adult tenants allowed to stay in the rental. Minors should also be acknowledged due to some state laws.
Your lease agreement template should also include the name of the landlord. This will serve as your renter’s reference since both parties will have their own lease agreement copies.
By making this information clear, non-tenants can be prevented from staying in the rented property. This will also help you set up ground rules about having guests at the property.
Lease Property Maintenance Information
Usually, a lease agreement template needs to clarify the terms for maintenance and repairs. You should include an option for tenants to state their preferred maintenance contact persons and their information.
In some situations, the landlords may choose to take care of the maintenance requests on their own.
When it comes to routine maintenance, most states require the fees to be covered by the landlord. Damages and repairs not caused by the tenant should also be covered by the landlord.
Include Upfront and Scheduled Payments
A legally binding document such as a lease agreement template should have clear information about money exchanges. That’s why it’s important to be clear about the payments needed up front and those that are scheduled for the future.
Payments needed up front include “security deposits”.This is a fixed amount that has to be paid before the tenant can move in. This is separate from the rent.
A security deposit usually amounts to one to two months’ worth of rent. This deposit will then be used to pay for cleaning or damage fees caused by the tenant. The remaining balance of this deposit will be returned to the tenant when they move out.
As for the rent, your lease agreement template should be clear on when rent will be collected. You should also include how long you’re willing to provide a grace period before collecting late fees.
After stating how long grace periods will be, you should outline the cost of late fees with their own due dates.
Another fee that should be included in your lease agreement template is a premature break of lease fee. This will be the amount that the tenant agrees to pay if they break the lease before its agreed end.
Clear up Any Provisions
Most rented spaces have specific provisions that depend on the property owner’s preference. The most common provisions that a lease agreement template has are:
- Pet Provisions – You can choose whether to allow your tenants to bring pets or not. If pets are allowed, they usually come with fees such as cleaning fees or added security deposits. Keep in mind that some states may or may not have breed restrictions.
- Subletting Provisions – You can choose whether you will allow your tenants to rent out your property or not. It may or may not be allowed for any part or the entirety of your property. If you choose to allow it for your property, you should include additional provisions for the additional tenants.
- Parking Provisions – You should include details and limitations about parking details if your tenant will be using a parking space or driveway. You should also include the tenant’s vehicle details to help prevent non-renters from using your parking space.
Consider an Auto-renewal Clause
Most lease agreements only last one year. However, you can give the tenants the option to renew their contract with the same terms. You may also choose to alter your terms and require your tenants to agree before continuing to rent your property.
With an auto-renewal clause, your tenants can have the security of a long-term lease while having the option to end the lease for a specific time after the end of the old lease period. Landlords will also be able to keep desirable tenants longer.
Final Thoughts on Making a Lease Agreement Template
Keeping these pointers in mind, you will be able to make a well-written lease agreement template. With a well-written lease agreement template, you will lessen the chances of problems arising in the future.
Always keep in mind that the information you include in the lease agreement template is crucial to prevent loopholes and the possibility of a void contract. The amount of money to be exchanged should also be double-checked to avoid complications in the future.
In the end, a lease agreement template serves to protect the terms of the property owner and the tenant. Make sure that all the conditions you wish to be fulfilled can be covered by the lease agreement template.
These conditions should include specific ground rules and provisions. Making this information clear can make sure that your signed lease agreement template can become a reference if your rules are violated.
If you have any concerns about making a lease agreement template, you can leave a comment below!
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