“Points to Include in Making a Rental Agreement Template”
Making a good rental agreement template is important when you’re running a rental property. Without it, you may find yourself having myriad issues with your tenants.
The rental agreement template is basically a “default” document you can use as the basis of your rental contracts.
It contains most of the clauses you consider important in your rental agreement with tenants… while also allowing space for added clauses, should they be merited.
Generally, a great rental agreement template won’t require you to add too many things just for it to be usable. In that way, it can save you a lot of time when striking up contracts with new tenants.
That’s why, as a property manager you need to make sure you are making the clearest and most practical rental agreement template. It saves you time, protects your business, and ensures you and your tenants begin your contract with each other properly.
Today, we’ll learn how to make a rental agreement template. Here are important points you need to cover when making a rental agreement template.
What to Include in a Rental Agreement Template
Knowing what to include in a rental agreement template is important for a property manager. It helps you cover your bases legally as well as practically in your rental agreements.
Your rental agreement template sets out the rules and conditions that tenants need to follow. It also acts as a legal contract that’s filled with crucial business details and terms.
That’s why it’s of great practical value to you. It can determine the future of your tenancies at the rental property concerned, as well as help you protect yourself and your property from various problems.
It’s all right if you don’t know where to start when making your own rental agreement template, though. As I said earlier, you’ll learn how to do it today.
So without further ado, let’s discover how to make a rental agreement template.
Obviously, your rental agreement template should have space ready for the basic information. That includes the name and address of the rental property.
You must also include the most important information of your prospective tenant—such as his name and other identifying details.
Names are necessary for obvious reasons. For the rental agreement template to turn into a binding contract later on, it has to contain the full names of all involved parties.
That’s why your name has to be in your rental agreement template too, obviously. It should state in what capacity you are acting, whether as the landlord or property manager of the unit.
Be sure too that there are spaces at the end of the contract for both you and your tenants to sign your names. Proper signatures are required for a rental agreement template to become a valid and binding legal contract.
Fees and Deposits
It’s advisable that you also include the fees and deposits required of tenants in your rental agreement template. Make a section where each tenant’s fees and deposits are thoroughly discussed.
This will supply tenants with information regarding their payables throughout the whole rental term. That’s actually necessary if you want your terms on fees to be fixed as part of the contract you have with your tenants.
If you don’t state the specific prices or fees for your tenants in your rental agreement template, you won’t have any protection if tenants choose to pay you less than the originally-agreed rent. You need proof of the amounts set during your contract’s creation.
Take note that you should cover everything that has to do with money in this section. For example, you should probably add notes in your rental agreement template too about these:
- The terms on utilities, like who covers what and to what extent.
- The terms on maintenance costs, such as whether or not you require tenants to pay a percentage of the total maintenance costs for common areas, etc.
- The terms on unit repairs, e.g. whether or not you will pay for repairs to damage in a unit, which types of damage are your responsibility and which are the tenant’s, etc.
Don’t forget to add information covering the practical aspect of making payments. For example, you should state in your rental agreement template when you expect rent to be paid.
Thus, include the date of payment per month as well as the payment process. State the exact amount, possible payment methods, and date of payment to avoid misunderstanding.
This is very important in a rental agreement template. The tenancy terms must be thoroughly discussed to ensure that tenants understand them all.
This is especially important if you want to impose certain ground rules throughout the term of a tenant’s rental.
After all, how can you expect tenants to follow your rules if they don’t have an easy reference to them in your rental agreement template?
The flexibility of the term and term extension options need to be included too. You should explain in your rental agreement template how a tenant can apply for an extension of his contract at or near the end of his current tenancy.
Furthermore, the precise terms of the current tenancy must be laid out in your rental agreement template. Tenants must know when and how they will pay and for how long they’ll be staying.
Identify the precise dates when the tenancy starts as well as ends. That way, there’s no guesswork involved to this part of the agreement between you.
It’s very important that you set rules inside the rental premises. Generally speaking, landlords want to prohibits tenants from doing illegal activities.
This helps keep your property a better, safer place for tenants to stay in. That means you’ll be likelier to attract better tenants and, at the same time, reduce the chances of having tenants cause damage to the property.
To help enforce your rules on behavior, you may want to include a statement of the consequences for violations in your rental agreement template. You might even state eviction as a possibility.
Here are a few behaviors that must not be tolerated in your rental place:
- Dealing with illegal drugs, and
- Excessive noise.
Maintenance and Repair Responsibilities
Aim to clearly sort the tenant’s responsibility on the rented property. You must make sure that in your rental agreement template, you state the things they need to do.
You may also restrict the tenant’s right to install or add anything to the rented premises without landlord’s permission. Being the landlord gives you the right to require tenants to keep premises as they found them.
Also, state in your rental agreement template that you require tenants to inform you of any defective condition of the property.
This includes these:
- Faulty wiring,
- Failed water-proofing,
- Soil settlement,
- Wall cracks,
- Broken window glass, and
- Ceiling leaks.
Note that unless it was installed by the tenant, then you won’t have the responsibility on repairing it. You may want to put that in your rental agreement template.
Added Rules on Tenants’ Pets
It’s pretty hard to avoid tenants who own pets. But if you don’t allow pets to reside with them, that’s perfectly fine, so long as it’s in your rental agreement.
Thus, allowing or forbidding pets should be clearly written in the rental agreement template.
If you allow it, you usually have a little more work to do on your rental agreement template. You will usually have to add rules on what you allow or require relative to tenant’s pets.
For example, you may want to set the maximum number of pets per rental unit in your rental agreement template. It’s best to have only 2-3 in maximum.
You can also decide what types of pet are allowed. Fur pets, birds, or fish—just state what you allow or forbid in your rental agreement template.
Make sure that you also state your tenants’ responsibilities as pet keepers. The rental agreement should also state that they must keep the rented area free of any animal waste.
Stance on Subleasing
You also need to state in your rental agreement template whether or not you allow subleasing.
Again, you have more work to do if you allow it. You see, you still have to specify the conditions under which you allow it or the terms surrounding its execution.
Make sure you state that they should ask for your permission first. That helps you retain some control over the matter.
You can also state terms like these in your rental agreement template:
- Charging the subtenant with a higher rental fee.
- Giving the subtenant only limited access to the rental.
These are just hypothetical possibilities. You can set the terms for subleasing as you wish when making your rental agreement template.
Landlord’s Right of Entry
This is a very important matter to discuss in the rental agreement template. You want your tenant to be aware of when you can enter the premises, why, and under what conditions.
That way, your renter always knows what to expect. You can also reassure him with your terms that he retains privacy in his unit throughout his tenancy (say, by stating that you have to give notice before entering the premises for an inspection).
You can also state the times when you may be permitted to force entry if they are absent. Here are some common examples:
- In case of an emergency.
- When they fail to pay for the rent and have repeatedly refused all attempts at remedying this issue or arbitrating it in a court of law.
Final Thoughts on a Rental Agreement Template
That’s it for today’s blog post on making the best rental agreement template.
This rental agreement is a binding contract between you and your tenant. Thus, you have to ensure that you cover all the important points about the tenancy in it.
Here’s a recap of the things you need to cover in your rental agreement template:
- The basic information of the property and parties to the tenancy.
- The terms on fees and deposits.
- The terms of the tenancy, e.g. the duration and conditions for renewal.
- The activities forbidden in the property.
- The maintenance and repair responsibilities.
- The rules on tenants’ pets (if applicable).
- The rules on subleasing (if applicable).
- The terms of entry for the landlord or property manager.
Do you want to know more about making a rental agreement template? Let us know in the comments below!
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