A residential lease contract is usually one of the most important elements that ensure a professional and friendly landlord/tenant relationship. A lease contract outlines a roadmap for the tenancy, providing a detailed explanation of the rights and duties of both parties.
A lease contract serves both as a point of reference as well as a binding document that is enforceable in court should either party fail to keep their end of the deal. Additionally, this document can help parties make their expectations clear and establish a smooth relationship.
Here are the important elements that should be included in a residential lease agreement.
A rental agreement cannot be complete without a detailed description of the rent amount. This component not only includes the rent amount but also how and when it will be paid. Here are the details that should be included in the rental price clause:
- Rent payment date and method (direct deposit, cash or check)
- Grace period and penalties for default or late payments
- Penalties if the check bounces
Some of the most common landlord/tenant disputes originate from security deposits, how and when they will be paid, and how and when they will be refunded at the end of the tenancy contract. To prevent these disputes, a lease agreement must clearly specify details regarding security deposits as well as related fees including:
- The security deposit amount
- Where this deposit will be held
- How the security deposit may be used
- How and when the deposit will be refunded
Maintenance and repair policy
A sound residential lease contract must outline the maintenance and repairs that will be addressed by the landlord. Having this clearly spelled out will prevent rent withholding by an angry tenant who expects repairs to be made as well as any potential future conflicts regarding security deposit refund.
A well-thought-out residential lease agreement can mean the difference between an amazing landlord/tenant relationship and a stressful one. The terms outlined in the rental agreement are especially important if you are looking to rent to own a property.