How to Write a Rental Agreement

If you believe yourself to be ready to begin renting out your property to tenants, you will need to design a lease agreement that will protect you, as well as your property.

Coming to terms on what payments should be is a major part of a lease agreement, there are also a few other parts that need to be talked about and agreed upon so that your investment property will be protected. 

The first part of the rental agreement should describe what payment terms you and your tenant(s) have to agree upon.

Here's the payment information you need to have: 

• Exact amount of rent 
• Due date for rent 
• Late fees for missing the rent due date, and when they will go into effect 
• Security deposit and refunds 
• Fees for returned checks 
• Other fees the tenant will be responsible for, such as utilities 

You should also talk about what payment methods you will accept, such as checks, CashApp, PayPal, or money orders. 

Property Specifics

The next part goes into definite details about the rules on the property. This is a vital section because it describes how you can protect your property from being recklessly damaged by the tenants. Here are some things that you should have in this part of the agreement: 

• The definition of property premises 
• The definition of damage vs. normal wear and tear 
• The owner's right to enter and inspect the property, and how much notice they need to give tenants 
• Specific details on what can and can't be altered (hanging pictures, painting walls, etc.) 
• A reminder that the tenant must inform landlord of any damage 
• A reminder to not change the locks 

This section should be very well detailed and leave no grey areas because the tenants might take advantage of any vague details that could leave you paying a lot more money on repairs. 

Lease Termination 

There also needs to be an area committed to talking about lease termination which outlines if and when a tenant can terminate the lease. This part should also include any fees or penalties that the tenant will have to pay if they decide to terminate their lease early.

This protects landlords from having tenants end their leases early and suddenly, which would end up costing landlords a lot of money. 

Additional Information 

You'll need to cover all information in a tenant agreement because you never know what a tenant might attempt to do. The more detailed you are about the rules and guidelines of your property, the better. Here's some additional information you should think about to include in your lease agreement: 

• Are overnight guests allowed? How long can guests stay? 
• What parking is included? 
• Are pets allowed? If so, what kind and how many? Will there be pet fees or deposits? 
• How many keys are included? 
• Specific neighborhood or community rules 
• Noise ordinances 
• What can be stored on-site? 
• Can tenants sublet rooms? 

You should also explain what will happen if any of the above rules are broken by the tenant. 

Make Sure Your Lease Agreement Complies with Laws 

To protect yourself as the landlord, you will need to make sure your lease agreement follows federal, state, and local laws. For instance, you have to follow anti-discrimination laws, health and safety codes, occupancy laws, and disclosure requirements. 

You can also work with an attorney in order to ensure your lease agreement is solid and does not leave you liable. 

Get Help From the Pros 

Learning how to write a rental agreement is only the first step, creating one and making sure it's 100% solid so it protects you and your property is very hard to do unless you have the experience. 

These are just a few reasons why you should think about working with an attorney who knows exactly what to include in a lease agreement. 

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