A lease agreement is a form used by landlords for renting property to tenants in exchange for monthly rent. The tenant retains the right to reside and use the property for the full duration of the agreement so long all obligations are met.
- A binding contract used for renting residential or commercial space.
- Formed between the property manager (landlord) and one (1) or more tenants.
- Establishes the responsibilities and commitments of all parties.
- New Hampshire
- New Jersey
- New Mexico
- New York
- North Carolina
- North Dakota
- Rhode Island
- South Carolina
- South Dakota
- West Virginia
Commercial Lease Agreement – For any type of non-residential use such as retail, office, or industrial space.
Condominium Lease Agreement – For a residential unit located in a condominium association.
Equipment Lease Agreement – To rent tools or heavy machinery.
Month-to-Month Rental Agreement – Also known as a “tenancy at will,” this rental arrangement continues until either the landlord or tenant gives notice to the other (30 days notice is the more common notice period).
Rent-to-Own Agreement (Lease-Option) – Allows a tenant to purchase a rented property under predetermined terms and conditions.
Roommate Agreement – Establishes financial and social rules between tenants sharing the same apartment or house.
Simple (1-Page) Lease Agreement – For setting a basic rental arrangement between a landlord and tenant.
Standard Residential Lease Agreement – The most popular type of lease. A fixed-term contract for renting out property for a few months to a year or more.
Sublease Agreement – Allows a tenant who has a lease to rent (sublet) a portion or the entirety of their rental unit to someone else.
Short Term / Vacation Lease Agreement – A basic rental arrangement for short-term stays.
Weekly (Week-to-week) Rental Agreement – An “at-will” arrangement that can be terminated by giving seven (7) days’ notice.
A lease is a contract formed between the owner (or manager) of a property and the tenant that will be renting it. There are many types of leases, the most common being a fixed one (1) year term that does not allow either party to terminate until the end date.
- Credit Check (use Rental Application form).
- Security Deposit (see laws)
- Move-In Checklist
- State Disclosures (if any)
1. PARTIES. This Residential Lease Agreement (the “Agreement”) made on [TODAY’S DATE] is between:
Landlord Name: [LANDLORD’S NAME] with a mailing address of: [LANDLORD’S ADDRESS] (the “Landlord”), AND
Tenant Name(s): [TENANT NAME(S)] (the “Tenant(s)”).
The Landlord and Tenant are each collectively referred to as the “Parties.”
2. PROPERTY. The Landlord agrees to lease the described property to the Tenant:
Address: [PROPERTY ADDRESS] (the “Premises”).
Residence Type: ☐ Single-family ☐ Apartment ☐ Condominium ☐ Other: [OTHER]
The Agreement shall begin on [MM/DD/YYYY] and end on [MM/DD/YYYY] (the “Term”).
The Tenant shall pay the Landlord in equal monthly installments of $[RENT] (the “Rent”). The Rent shall be due on the [#] of every month (the “Due Date”) and paid under the following instructions: [RENT PAYMENT INSTRUCTIONS].
5. SECURITY DEPOSIT. The Tenant (check one):
☐ Shall deposit with the Landlord the sum of $[SECURITY DEPOSIT] as security for any damage caused to the Premises during the Term. Such deposit shall be returned to the Tenant, less any itemized deductions, within [#] days after the end of the Term.
☐ Shall NOT be required to pay a security deposit.
Landlord’s Signature: _______________________ Date: [MM/DD/YYYY]
Printed Name: [LANDLORD PRINTED NAME]
Tenant Signature: _______________________ Date: [MM/DD/YYYY]
Printed Name: [TENANT PRINTED NAME]
Tenant Signature: _______________________ Date: [MM/DD/YYYY]
Printed Name: [TENANT PRINTED NAME]
Before a lease can be signed, a tenant must be shown the property, negotiated with, and screened to know their credit and background. Below are the steps that should be followed to lease a property from start to finish.
- Step 1 – Marketing/Finding a Residence
- Step 2 – Schedule a Showing
- Step 3 – Screening the Tenant
- Step 4 – Approving or Rejecting the Tenant
- Step 5 – Negotiating
- Step 6 – Signing the Lease
- Step 7 – Taking Occupancy
- Step 8 – Paying Rent
- Step 9 – Renewing/Terminating the Lease
- Step 10 – Returning the Security Deposit
The landlord should begin marketing the property by posting online and in any local classified publications. In 2017, 37% of the US population (43.7 million) were renters and 83% of them used the web to find a rental. In addition, 31% of renters felt the largest issue in their search was finding accurate information about a particular property.
Therefore, it is important to disclose all details of the property and take clear photos of each part of every room.
Property for Rent (top 5 websites)
When a potential tenant asks to view the rental property, it’s best to schedule a visit when the current tenant is not home and the premises are clean. It’s also recommended that the property is shown during the day show the space in as much natural light as possible.
- Move-in Date – Before setting up an appointment, ask the potential tenant their move-in date. Many people start their search too early; landlords should only meet with prospective tenants who are looking to rent within sixty (60) days.
- Rental Application – At the showing, use a rental application form to obtain the applicant’s information and have them consent to a credit and background check.
After obtaining the tenant’s credentials through the application it’s time to run a credit and background check to ensure creditworthiness. There is a cost to performing background checks (between $15 to $45) and landlords usually charge applicants for this.
Screen a Tenant (top 5 websites)
Income Verification – It is helpful to obtain the last two (2) years of tax returns (IRS Form W-2) and the last two (2) weeks’ paystubs. If the applicant is self-employed, then the last three (3) months’ bank statements will suffice.
Landlord References – The best reference is always past landlords. Be sure to contact the applicant’s current or previous landlord to ask if they paid rent on time, if they are a loud or quiet tenant, and if they caused any damage.
After reviewing the tenant’s credit report, criminal history, and verifying references, it’s time to make a decision.
If approved, the tenant will go on to negotiate and sign a lease agreement in the next steps.
If rejected, the landlord will be required to send the applicant an adverse action (rejection) letter stating the reasons for refusal and where they can get a copy of their credit and background check.
If the landlord is interested in renting their property to an applicant, it’s time to negotiate the lease. The monthly rent is the most common item that is debated. If the applicant did not attempt to negotiate when they were applying, they probably will not request a discount.
If the tenant has bad credit the landlord can request the following:
- Additional Security Deposit – In accordance with State laws.
- Increased Monthly Rent – Due to the elevated risk of a tenant with bad credit, some landlords may increase the monthly rent.
- Pre-Pay Rent – In case the tenant loses their job or income. This is always applied to the last months of the lease, not in the beginning.
- Request a Co-Signer – This requires the tenant to find someone else to act as a “guarantor.” A guarantor agrees to pay for any unpaid debts or damage if the tenant defaults on their lease. Use the Guarantor Addendum.
After filling out the lease (see How to Write), it’s time for the landlord and tenant to sign the document (with the real estate agent, if any). It is recommended that the parties sign the lease in the presence of at least one (1) witness or a notary public. If the landlord or tenant would prefer to sign electronically, the lease can be uploaded using eSign and sent to the other party.
After the lease has been signed, all payments including the security deposit, first month’s rent, and any other fees must be paid to the landlord. Upon successful payment, the landlord will issue access to the tenant in the form of keys, fobs, or access codes. All entry keys must be given to the tenant, including those for common areas and mailboxes. After they get the keys, the tenant should go through the property to look for any signs of damage. Any issues should be recorded on a move-in checklist.
During the course of the lease, the tenant will be obligated to pay rent on a monthly basis. It is recommended that landlords have their tenants pay online or automatically via ACH. In a 2019 study, consumers made 74% of their transactions with non-cash payments and 85% of tenants that pay rent online successfully pay rent the next month. Therefore, it’s best to obtain the tenant’s ACH details or use an online service to collect rent from the tenant.
Accept Rent Online (top 5 websites)
- Cozy.co (Free ACH, 2.75% cc fees)
- Zillow (Free ACH, 2.95% cc fees)
- Avail.co ($2.50 ACH, 3.50% cc fees)
- RentPayment.com ($4.95 ACH, 2.95% cc fees)
- PayYourRent.com ($2.50 ACH, 2.75% cc fees)
At the end of the lease term, the landlord and tenant must decide whether the tenant will move out or renew the lease. If renewing, the landlord can send the tenant a Lease Extension Amendment that keeps all the terms of the current lease while extending the date. If the landlord decides to change or add any terms, such as a rent increase, these can be added to the form.
If the tenant decides to move out of the property or the landlord decides not to renew the lease, the landlord will send a Notice Not to Renew Letter that will inform the tenant to vacate the premises on the lease end date.
At the end of the tenancy, the landlord will be required to return the deposit paid at the beginning of the lease in accordance with State Security Deposit Laws. The deposit must be returned to the tenant, minus any damage left on the property, to the forwarding address given by the tenant.
If the landlord deducts any amount from the security deposit, an itemized list of the damages must be provided to the tenant.
The following are the state by state security deposit laws with accompanying sources:
|Alabama||1 month’s rent||60 days after the lease terminates||§ 35-9A-201|
|Alaska||2 months’ rent||14 days if proper notice is given; 30 days otherwise||§ 34.03.070|
|Arizona||1.5 months’ rent||14 days after the lease terminates (does not include holidays/weekends)||§ 33-1321(D)|
|Arkansas||2 months’ rent||60 days after the lease terminates||§ 18-16-305(a)|
|California||2 months’ rent unfurnished; 3 months’ rent furnished||21 days after tenant(s) move out||§ 1950.5|
|Colorado||No limit||1 month; up to 2 months if stated in the lease||§ 38-12-103(1), § 38-12-104|
|Connecticut||2 months’ rent if younger than 62; 1 month’s rent if older||15 days after receiving tenant’s new mailing address, or 30 days after lease termination (whichever is later)||§ 47a-21|
|Delaware||1 month’s rent for 1-year leases only||20 days after the lease terminates||§ 5514|
|Florida||No limit||15 days if no deductions, otherwise 30 days||§ 83.49(3)(a)|
|Georgia||No limit||30 days after tenant(s) move out||§ 44-7-34(a)|
|Hawaii||1 month’s rent (not including pet fee)||14 days after the lease terminates||§ 521-44(c)|
|Idaho||No limit||21 days if not stated in the lease; 30 days otherwise||§ 6-321|
|Illinois||No limit||30 days if deductions; 45 days otherwise||765 ILCS 710|
|Indiana||No limit||45 days after the lease terminates||§ 32-31-3-12|
|Iowa||2 months’ rent||30 days after the lease terminates||§ 562A.12(3)(a)|
|Kansas||1 month’s rent unfurnished; 1.5 months’ rent furnished||30 days after the lease terminates||§ 58-2550(b)|
|Kentucky||No limit||60 days after the lease terminates||§ 383.580|
|Louisiana||No limit||1 month after the lease terminates||§ 3251|
|Maine||2 months’ rent||30 days for fixed-term lease, 21 days for periodic leases||§6032, §6033|
|Maryland||2 months’ rent||45 days after the lease terminates||§ 8-203|
|Massachusetts||1 month’s rent||30 days after the lease terminates||Ch. 186 §15B|
|Michigan||1.5 months’ rent||30 days after the tenant(s) move-out||§554.602, §554.609|
|Minnesota||No limit||3 weeks after the lease terminates||§ 504B.178|
|Mississippi||No limit||45 days after the lease terminates||§ 89-8-21|
|Missouri||2 months’ rent||30 days after the lease terminates||§ 535.300|
|Montana||No limit||30 days if deductions, 10 days otherwise||§ 70-25-202|
|Nebraska||1 month’s rent (not including pet fee)||14 days after the lease terminates||§ 76-1416|
|Nevada||3 months’ rent||30 days after the lease terminates||NRS 118A.242|
|New Hampshire||1 month’s rent / $100 (whichever is greater)||30 days after the lease terminates||§ 540-A:6 & § 540-A:7|
|New Jersey||1.5 months’ rent||30 days after the lease terminates||N.J.R.S. § 46:8-21.2 & § 46:8-21.1|
|New Mexico||1 month’s rent||30 days after the tenant(s) move-out or the lease terminates||§ 47-8-18|
|New York||1 month’s rent||14 days after the tenant(s) move-out||576/74 § 6, § 7-108(e)|
|North Carolina||2 months’ rent (1.5 months rent for leases at will)||60 days if deductions, 30 days otherwise||§ 42-51, § 42-52|
|North Dakota||1 month’s rent (2 months’ rent for pets)||30 days after the lease terminates||§ 47-16-07.1|
|Ohio||No limit||30 days after the lease terminates||§ 5321.16|
|Oklahoma||No limit||45 days after the lease terminates||§ 41-115|
|Oregon||No limit||31 days after the lease terminates||§ 90.300(13)|
|Pennsylvania||2 months’ rent||30 days after the tenant(s) move-out or the lease terminates||§ 250.511a, § 250.512|
|Rhode Island||1 month’s rent||20 days after the tenant(s) move out or the lease terminates||§ 34-18-19|
|South Carolina||No limit||30 days after the tenant(s) move-out or the lease terminates||§ 27-40-410|
|South Dakota||1 month’s rent||45 days if deductions, 14 days otherwise||§ 43-32-6.1, § 43-32-24|
|Tennessee||No limit||30 days after the tenant(s) move-out, or 7 days after a new tenant moves-in||§ 66-28-301(g)(1)|
|Texas||No limit||30 days after the tenant(s) move-out||§ 92.103(a)|
|Utah||No limit||30 days after the tenant(s) move-out||§ 57-17-3(2)|
|Vermont||No limit||60 days if the unit is a seasonal/vacation rental, 14 days otherwise||§ 4461(c)|
|Virginia||2 month’s rent||45 days after the lease terminates||§ 55.1-1226|
|Washington||No limit||21 days after the tenant(s) move-out||§ 59.18.280|
|West Virginia||No limit||45 days if the property is re-rented, 60 days otherwise||§ 37-6A-2|
|Wisconsin||No limit||21 days after the lease terminates||§ 134.06(2)|
|Wyoming||No limit||15 days after the landlord receives the tenant’s new address, or 30 days from lease termination (whichever is lesser)||§ 1-21-1208|
The following are three (3) mistakes commonly made by landlords during the leasing process:
1. Negotiating BEFORE the Rental Application
Until the landlord conducts a thorough background check of the tenant, there is no reason to begin the negotiating process on either side without knowing the financial background of the tenant.
2. Move-in Date Beyond 45 Days
The landlord should never agree to a move-in date beyond forty-five (45) days. Otherwise, the landlord runs the risk of losing more than a month’s rent.
3. Not Requiring the Tenant’s Social Security Number (SSN)
Due to the rise in identity theft, landlords have been hesitant to require the tenant to write their social security number on the rental application. This must be a requirement in order to view all available public records on an applicant.
Note about colors:
- Red – Mandatory information. The landlord must complete all red sections.
- Yellow – Information that is optional, or is only required if a certain checkmark is selected.
- Blue – Also optional information. Used in conjunction with yellow to show varying options.
Steps 1-4 (The Parties)
This section is used for identifying the landlord (the person that manages or owns the rental) and the tenant(s). The landlord will need to type the following information in this section:
1) – Date. The date the lease is being completed (the current date).
2) – Landlord name. The full name of the landlord. This is the person that owns or manages the property.
3) – Landlord’s address. Includes the street, city, state, and ZIP code.
4) – Tenant name(s). The name(s) of the tenant(s) that will be renting the property.
Step 5 (Property Address)
5) – Property address. The full address of the rental property. This should include the street, unit # (if any), city/town, state, and ZIP code.
Example: 123 Rental Ave, Suite 9A, ABC City, Texas 78701.
Step 6 (Lease Type & Term)
This area is for specifying the length of the lease. The landlord can choose one of two (2) options. The first (and more common) option is “Fixed Lease,” which refers to the agreement being established for a pre-determined length of time (such as 1 year). The second option is a “Month-to-Month Lease,” which is a type of periodic contract that has no end date and renews automatically on a monthly basis until either party wishes to terminate it.
6) – Lease type. Check one (1) of the two options shown. If “Fixed Lease” is selected, complete the fields marked with yellow. Enter the start and end dates, and select whether the lease will continue as a “month-to-month” agreement after the term ends OR if the tenant(s) will be required to move out.
If “Month-to-Month Lease” is selected, enter the starting date of the lease followed by the number (#) of days either party has to give in order to terminate the contract.
Steps 7 – 9 (Rent)
This provision allows the landlord to set the monthly rent ($) the tenant(s) will be required to pay.
7) – Rent amount. Type the total amount ($) of rent the landlord will collect from the tenant(s).
8) – Rent due day. Enter the day of the month the rent will be due. This is typically the first (1st) of every month.
9) – Payment instructions. Describe how the tenant should go about paying rent (e.g., “Mail via check to [Address]” or “send via PayPal.”)
Step 10 (Late Fee)
A late fee is a monetary penalty that is billed to the tenant(s) if they are late on rent.
10) – Late fee (Y/N). Select whether or not the tenant(s) will be charged a fee if they are late on rent. If the first option is selected, complete steps 10a and 10b by typing the amount ($) of the late fee, followed by the number (#) of days that must pass after the rent due date before a late fee can be issued.
Step 11 (Proration Period)
A proration period is any time the tenant will be living in the rental that doesn’t fall within one (1) full rent payment period. For example, if the tenant wanted to move into the property a couple of weeks before the official start of the lease, the landlord could require them to pay two (2) weeks’ worth of rent (known as “prorated rent”).
11) – Proration period (Y/N). Place a checkmark in one (1) of the two boxes shown to indicate the proration period. If the first box was selected, enter a) the starting date of the proration period, followed by b) the amount ($) the tenant will be paying.
Note: Many states consider rent that is received upfront to be a security deposit. Because many states restrict security deposits to one (1) or two (2) months of rent, the landlord could be breaking rental laws by accepting pre-paid rent on top of a security deposit.
Step 12 (Security Deposit)
Enter the dollar ($) amount of the security deposit that the tenant(s) is/are required to pay at the start of the lease. Enter the full value of the deposit, not the amount each tenant would be required to pay. Specify the number of days the landlord has to return the deposit (less any deductions) at the end of the lease.
12) – Security deposit (Y/N). Check the appropriate box to indicate whether or not the tenant(s) will be required to pay a security deposit. If the first (top) box is checked, enter a) the amount ($) of the security deposit that will be collected, followed by b) the number (#) of days the landlord will have to return the deposit once the lease term expires.
Step 13 (Returned Checks)
A “returned check” occurs if a tenant’s check bounces due to insufficient funds in their bank account. To prevent this from occurring, the landlord can charge a fee.
13) – Returned check fee (Y/N). If the landlord will require a fee ($) for bounced checks, place a checkmark in the first box and enter the amount ($) of the fee. If a fee will not be required for bounced checks, select the second (2nd) box and proceed to the next step.
Step 14 (Additional Occupants)
14) – Occupants (Y/N). If the tenant(s) will have additional person(s) living in the rental, check the first (1st) box and type the name(s) of the other occupants in the provided field. If the tenant will not be living with other occupants, check the second (2nd) box.
Step 15 (Move-in Inspection)
15) – Move-in inspection (Y/N). If the landlord and tenant(s) will be completing a move-in checklist together, select the first (1st) box. Otherwise, check the second (2nd) box.
Note: Conducting a move-in inspection is highly recommended to avoid charging the tenant(s) for the damage they didn’t cause.
Step 16 (Furnishings)
16) – Furnishings (Y/N). If the rental is furnished, check the first (1st) box and list the furnishings that will be included (e.g., “living room couch, TV set, dining table). If it is not furnished, check the second (2nd) box and head to Step 17.
Step 17 (Utilities)
17) – Utilities. List any utilities that the landlord will be responsible for (if any). Any fees not included will be the tenant’s responsibility.
Step 18 (Parking)
18) – Parking provided (Y/N). If the tenant(s) will be provided one (1) or more parking space(s), check the first (1st) box. Then, a) type the number (#) of spots provided, b) check the box corresponding to whether or not a fee is required, c) type the amount ($) of the fee (if any), followed by d) selecting the option that corresponds to how often the fee will need to be paid. If the tenant(s) will not be given parking, the last box (blue) should be checked.
Step 19 (Pets)
Due to pets being a potential liability for landlords, many choose to restrict (or deny) the number and types of pets tenants can have.
19) – Pets allowed (Y/N). If pets will be allowed on the premises, check the first (1st) box. Then, the landlord will need to a) type the number (#) of pets that the tenant(s) can have, b) list the type(s) of pets that are permitted, followed by c) the deposit the tenant(s) will need to provide to cover any damage caused by their pet. If pets are not allowed on the premises, the second (2nd) box should be checked.
Step 20 (Smoking Policy)
20) – Smoking (Y/N). If smoking is permitted in certain areas on the premises, check the first (1st) box and specify exactly where tenants can smoke. If smoking is not allowed, check the second (2nd) box.
Step 21 (Sale of Property)
In the event the owner of the property sells the rental, the landlord can specify whether the new owner would have the power to terminate the rental agreement.
21) – Right to terminate lease (Y/N). Check the first (1st) box if the new owner would have the right to terminate the rental agreement. Then, enter the number (#) of days’ notice the new owner would need to provide the tenant. Check the second (2nd) box if the new owner would not have the right to terminate the lease agreement.
Steps 22 & 23 (Notices)
22) – Landlord notice address. Type the full address the tenant(s) can use to send the landlord notices and other important information.
23) – Tenant notice address. Type the address that should be used for sending the tenant notices (most likely the same address as the rental property).
Step 24 (Governing Law)
24) – State name. Enter the name of the state the rental property is located in.
Step 25 (Lead-Based Paint)
25) – Property built before 1978 (Y/N). If the property was built prior to 1978, check the first (1st) box. The landlord will need to complete (and attach) a Lead-Based Paint Disclosure Form. If the property was built after 1978, check the second (2nd) box and proceed to the next step.
Step 26 (Additional Provisions)
26) – Additional provisions. If there are any additional sections the landlord wishes to include in the agreement, they can be written in the text box provided. Alternatively, the landlord can attach an addendum if more room is required.
Step 27 (Signatures)
At a minimum, the landlord and one (1) tenant need to sign the lease.
27) – Landlord name, signature, & date. The landlord will need to sign their name (with eSign or by hand), enter the date (mm/dd/yyyy), and write their full name beneath their signature.
28) – Tenant name, signature, & date. At a minimum, at least one (1) tenant will need to sign, date, and print their name on the contract.
29) – Second (2nd) tenant name, signature, & date. If a second tenant will be on the lease, they will need to sign, date, and print their name on the form.
In addition to a lease agreement, landlords and property managers may require any of the following forms:
Eviction Notices – For formally notifying a tenant of a lease violation.
Rental Application – To be used by a landlord seeking to screen a tenant before signing a lease.
Lead-Based Paint Disclosure – A federally-mandated form that must be given to tenants if the property they’re moving into was built prior to 1978.