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Rental and Lease agreements are very commonly drafted when a person is renting someone else’s property for a definite time. We all know what rental lease is, however, there are many people who do not make the use of proper agreements while undertaking a rental lease.
This can be very risky for both the property owner and the renter. A poorly written rental lease agreement holds no value in court. Further, no party can make any claims if this agreement does not say anything regarding the issue.
Therefore, it is important to have a carefully drafted rental and lease agreement. You are going to learn all about these agreement templates here, along with free rental and lease agreement templates that you can use for your needs.
What Is a Rental and Lease Agreement?
A rental and lease agreement is a written contract between a lessor (the property owner) and the lessee (the property renter). In a rental and lease agreement, a lessee is given the right to rent a property in exchange for a monthly compensation called rent.
These agreements do not give the lessee the right to own the property. However, there are certain allowances that are given to the lessee in terms of modifying the property as the lessee wishes to suit their needs.
The lessee is solely responsible for the condition of the property during the tenure of the lease (for fixed lease agreements) or for the period of residence (for rental agreements). A rental and lease agreement makes sure that there are no disagreements later between the lessor and the lessee, and it clearly defines which expenditures will be paid by which party.
Leases are legally binding contracts, and they apply to all sorts of real estate properties, residential property, commercial property, or any other.
Why Do I Need a Rental and Lease Agreement?
A rental and lease agreement is very important when it comes to leasing a property. Since this agreement clearly defines the obligations of both parties- the landlord and the property renter, it avoids the possibilities of conflict in the future. Further, they also let the lessee know about the modifications they are allowed to do in the property.
Therefore, they can make use of this freedom to modify the property to suit their needs, without worrying about the landlord’s restrictions.
A rental and lease agreement also eliminates any disputes regarding expenditures on modifications or maintenance of the property. It clearly describes who is going to bear these expenses, therefore both parties know by default about what they are getting into. The agreement is agreed upon by the lessor and the lessee.
Therefore, it describes what either party can do or cannot do. In case there is a conflict, the agreement can very well be taken to a court.
What Happens if Someone Breaks a Rental and Lease Agreement?
There can be serious repercussions for the party that is breaking the agreement, whether it is the lessor or the lessee. In case the tenant is breaking the lease, they can face a civil lawsuit by the landlord. Further, it also creates a derogatory remark on their credit report. This can result in additional problems for the tenant in their future endeavors.
Therefore, before breaking a lease, it is a good idea for the tenant to discuss the issue with a landlord to see if there is a resolution possible. Otherwise, they must seek legal counsel prior to breaking a lease.
In order to avoid these circumstances, there can be a clause added in the rental and lease agreement that allows for early termination in cases where a landlord is not making in-time repairs to the property.
What is Included in a Rental and Lease Agreement?
The components of these agreements vary from case to case, and it depends on what the landlord and the renter are seeking. Any clause that has the agreement of both these parties can be added to a rental and lease agreement.
In general, the important components of these agreements include:
- Rent Amount: Rent amount will be the monetary compensation given by the renter to the landlord in exchange for renting the property. The time period of the rent can be modified to suit the requirements of both parties. The rent can be paid weekly, biweekly, monthly, or at any interval mentioned in the agreement.
- Time Period: In the case of fixed lease agreements, there is a definite time period for which the lease is valid. In the case of rental agreements, no such time periods apply. Therefore, the rental and agreement should have this clause likewise, based on the situation.
- Security Deposit: Most landlords seek a security deposit when they are renting a property. Therefore, the amount of the security deposit should be mentioned in the agreement. It should also state whether the deposit will be refunded or adjusted in the rent.
- Rent Due Date: The rental and lease agreement should state the date on which the rent is due, the grace period (if any), and the penalties for paying the rent late.
- Pet Policies: The agreement should state any pet policies that are present for the property. The landlord cannot make unreasonable pet policies later if they are not mentioned in the agreement. Other additional components can be added in these agreements too, such as early termination clause, penalties for breaking the agreement, etc.
How Can I Draft a Rental and Lease Agreement?
In order to make sure that a rental and lease agreement upholds in a court, the agreement should be drafted well and valid from a legal point of view. This is why a rental and lease agreement is created by legal professionals.
You do not have to worry about hiring any lawyer, as you can download your own rental and lease agreement template from CocoSign with a single click. CocoSign offers customized legal agreement templates for you based on your own needs. These agreements are created by legal experts on top of their fields, so you do not need to worry about these being valid.
No matter what clause you want to be added to the agreement, CocoSign can do perfectly. We tailor the agreements on your exact requirements, so you can just download it and print it ready to sign.
Wrapping Up
Now you know what is a rental and lease agreement and how important it is when you are leasing a property. Therefore, no matter whether you are the lessor or the lessee, download the rental and lease agreement template from our website and see what you need in yours.