There's nothing better than finding that perfect apartment. Filling out the rental application begins the in-depth process that ends with your signature at the bottom of a rental lease contract.
In 2017, according to the Joint Center for Housing Studies of Harvard University, more than 43 million households rented. That means all different kinds of people signed 43 million rental lease contracts.
No two lease agreements were exactly alike since each property had its own policies. Because of all the variations, it's important to give your lease a careful read before signing it.
If this is a new experience for you, it may be your first time dealing with a legal document of any kind. They're notoriously difficult to read, and if you don't know the right jargon, they can be hard to understand. While waiting for your renter's application to get approved, brush up on some standard terms and policies in a rental contract agreement.
As a legal document, the language used to describe the basic rules associated with renting an apartment can be unfamiliar. They're not your everyday terms. Here's some detail to help clarify what the lease is really talking about.
A grace period is the amount of time you have after your rent is due to still pay without an extra fee or penalty. Your lease should explain the consequences specific to your property and include how long the grace period lasts each month.
A property manager can set a minimum of days you can be away from your apartment before you must notify them of your travel plans. This is most likely a precautionary measure.
If your property manager needs to access your home or contact you about an emergency while you're away, they can. Take note of the number of days mentioned in your lease since it can be as few as three.
This is the formal process that terminates your lease early. Eviction takes place as a result of certain conditions, which your lease outlines.
Some common situations that can lead to the start of the eviction process are failing to pay rent and allowing an illegal sublet, among others.
Throughout the rental lease agreement, you'll see the terms 'lessee' and 'lessor.' Since a lease is more of a generic document, placeholder names get used for the two parties involved.
You'll write in your name and the property manager will do the same somewhere at the beginning of the lease. You're the lessee or tenant. Your property owner or the management company will take the title of the lessor.
You may not think anything of letting a friend live in your spare room for a few months, but the legal term for an activity like this is subleasing. Your lease will have rules for subleasing.
They may allow it for a certain amount of time with prior approval or prohibit it completely. Either way, it's a risky venture since you're responsible for the damage a temporary live-in guest does. They aren't on the hook to lose any part of a security deposit, but you are.
Abatement clauses in your lease protect you should damage occur that's outside your reasonable control. Without these, you could end up responsible for unforeseen damages or “forces of nature" wreaking havoc.
Abatement allows you to suspend your lease and stop paying rent should your apartment become uninhabitable, forcing you to live elsewhere.
Especially if you're a new renter, the policies associated with renting can be unfamiliar to you. You want to fully understand them with respect to your rights as a renter. They also tell you what you can and can't do in your apartment. To stay on the good side of your property manager, these definitions should help.
Language in this section will typically include all circumstances where your property manager can enter your apartment. Cross-reference the policy in your lease with the state's landlord-tenant laws to ensure everything is legal and fair. If you notice something unusual, mention it. Your property manager must defer to state laws.
Property managers can't usually enter a rented property without at least 24 hours notice to the tenant. If you don't see that stipulation in your lease, request its addition.
Extenuating circumstances, where notice isn't necessary should appear in your lease, as well. Anything from a utility malfunction, flood or fire can lead to emergency access for repairs. This is a tricky policy that's best written up with a lot of detail within your lease.
Seeing a policy on this topic in your lease usually means your property manager requires you have renters insurance. This is a good thing. It protects you and your stuff.
Barbara Marquand from Forbes offers this explanation of why renters insurance is important for you:
“Your landlord's property insurance won't help you if disaster strikes. It covers the structure, but not any of your things. Renters insurance covers your belongings from all the possible bad events…such as fire, smoke, water damage, windstorms, lightning, theft and vandalism."
Having rules about who can stay over in your apartment may feel antiquated. There may be limits on how many nights in a row a guest can stay or a rule that all guests must register at the management office in your lease.
Often these policies get written in to protect management against unauthorized subleasing or too many people living within a single unit. If you have a lifestyle where the overnight policy in your lease is too strict, discuss it with the property manager and see if you can get it modified. If not, this might not be the apartment for you.
Rules written into your lease in this area can have a wide range of restrictions. Prohibitions against holes in the wall, holes of a certain size in the wall or paint on the walls are a few common guidelines. Your lease may also prevent you from changing fixtures or hanging curtains.
Usually, these policies are in place to prevent expensive damage to an apartment unit. Messing with these prohibitions is the easiest way to lose your security deposit.
If you have access to outdoor space, a balcony or patio, your lease agreement can include rules on the appearance of these spaces. Since they're visible to other potential tenants, keeping them looking nice and neat helps maintain the building's reputation. You may see rules against:
There should definitely be language within your lease outlining whether this property has scheduled rent increases. Take a close look, so you're able to budget in advance for these changes in your monthly expenses.
There may also be a disclaimer that your property manager reserves the right to raise rent without notice. That's standard boilerplate to protect management, and shouldn't fill you with too much concern. If you're worried about getting stuck in a lease where the rent gets too high, ask if they also have a policy to address that issue and get your options in writing.
Your lease will dictate if you can have pets, what the costs are and which breeds are not allowed. If animals are against the rules, don't let any come and visit either. Because pets can cause a lot of damage, the consequences for having one when you're not allowed can be severe.
Lastly, within your lease should be terms explaining what to do if you want to renew your agreement after the initial period is up. Policies can vary at this point. You'll either have to renew by signing a lease for the same time frame as you did initially, or you'll get to change your lease and go on renting month-to-month.
Switching over to this type of lease has its advantages. You aren't tied to a full one-year contract and can leave with 30-days notice when you're ready.
Now that you know the terms and policies most often found within a rental lease agreement, you'll better understand what you're reading. Make sure to read your entire lease before signing anything.
“A lease protects both tenants and landlord, and the landlord-tenant model has worked well over time," says Geoff Williams from U.S. News & World Report. The landlord-tenant model is what governs the rental of both commercial and residential property today. Through state statutes and common law, it helps shape the policies you'll read in your lease before you sign it.
After you finish reading the lease, make sure you agree with all the policies included. If something is missing, ask that it gets added. Make sure coverage is in enough detail to protect you when necessary.
Double-check you understand all the fees associated with the lease agreement. At this point, you'll also provide a certain amount of money, pre-discussed, as a component of the lease. You'll most likely pay first and last month's rent, as well as a security deposit.
The security deposit can total as much as two month's rent, but the required amount varies by state.
One final step before signing your lease is to tour the apartment with your property manager. Note any existing damage or conditions that could impact the return of your security deposit. These items should get added into the lease as pre-existing conditions. Sign this document along with your lease to validate the information. Your property manager will sign it, as well.
When you're happy with everything, it's time to sign your lease and take residency in your new apartment. It was a long process, but with the proper comprehension of your rental contract agreement, you know you're moving into a place where your rights are well-protected.