Essential Details About Basic Rental Agreements
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Before entering into leases, both renters and landlords need to understand their rights and responsibilities. These can be outlined in a rental agreement template, which forms the basis of a positive landlord-tenant relationship.
In this guide, we'll cover the following essentials:
- Basic details to include in the contract
- Common clauses to consider adding
- Best practices for using a basic rental agreement template
Basic Details in a Rental Agreement
No two rental agreements look exactly alike, but templates provide a solid starting point. Typically, a basic rental agreement template will include these details:
- Premises leased. Describe the location of the premises. This clause should include not only the address, but also any personal property the landlord owns that will be included with the premises.
- Occupancy. All those who occupy a property must be mentioned in the rental agreement. The tenant's name will be highlighted at the outset of the contract, while an occupancy clause adds the names and dates of birth for additional occupants.
- Lease term. When does the lease begin and end? Does the agreement involve month-to-month arrangements? To clarify, highlight the first and final days on which the contract applies.
- Rent. How much will the tenant pay each month? What happens if the lease does not begin on the first day of the month? Mention options for pro-rating the rent based on when the lease goes into effect.
- Security deposit. Many landlords require security deposits, which can be used to handle concerns such as property damage (beyond general wear and tear) and late rent. Each rental agreement should detail the requested deposit amount and the situations in which this might be used rather than returned to the tenant. Contracts should also explain how any portion of the security deposit not used by the landlord will be forwarded to the tenant once the property is vacated.
- Utilities. Some landlords cover certain utility charges, while others prefer for tenants to handle these expenses on their own. A basic rental agreement template should highlight specific types of utilities and whether or not they are covered in the referenced rental payment. Examples include electricity, gas, water, and trash disposal.
Clauses to Add to the Contract
The information outlined above is crucial, but ideally, rental agreements will include other details specific to the property and the best interests of both the landlord and tenant. As such, basic rental agreements often include these terms:
Consequences for late or unpaid rent. By the time they sign rental or lease agreements, prospective tenants should understand exactly what will happen if they neglect to pay their rent on time. Agreed-upon penalties may include late fees, including both initial charges and follow-up fines if rent remains unpaid.
- How returned checks will be handled. Additional penalties or late charges may be assessed if payments made by checks are returned. This section may also explain whether — or under what circumstances — cash will be accepted as payment.
- Notification when the lease changes. A specific clause should explain how and when the landlord will notify tenants of any changes to the rental agreement. Examples could include terminating or renewing the lease, as well as rent increases. Common practice is to alert tenants to these changes at least thirty days in advance.
- Pets. If pets are allowed on premises, the contract may mandate a written addendum outlining extra security deposits or pet rental payments. This section should also mention consequences for keeping pets on premises without the express consent of the landlord.
Best Practices for a Basic Rental Agreement
A basic rental agreement template can provide much-needed guidance as you determine what to include in your contract. Signing and executing the contract, however, is another matter altogether. Keep these best practices in mind as you proceed:
- Take the opportunity to customize rental contract templates. A basic rental agreement template helps to avoid leaving important details out of the contract. Beyond this, however, agreements should be customized to reflect the realities of a particular property or the preferences of the landlord.
- Keep contracts secure. Many rental companies and landlords prefer the streamlined process of signing rental agreements online. This approach may be convenient, but security concerns should be addressed. Nitro Sign maintains strict security controls to keep landlords and tenants safe.
- Be specific. When in doubt, include all relevant details. This limits the potential for conflict later on. Dollar amounts and dates are especially important, as these specifics remove all doubt.
A detailed rental agreement can provide powerful peace of mind for landlords and tenants alike. Nitro Sign provides additional confidence by keeping this process as safe and secure as possible. Start your free trial today to discover the benefits of our exceptional eSign workflow.