A
rental agreement is a contract, usually written,
between the owner of a property and a renter who
desires to have temporary possession of the property.
As a minimum, the agreement identifies the parties,
the property, the term of the rental, and the amount
of rent for the term. The owner of the property
may be referred to as the lessor and the renter
as the lessee.
A
rental agreement is often called a lease, especially
when real estate is rented. In addition to the basics
of a rental (who, what, when, how much), a real
estate rental may go into much more detail on these
and other issues. The real estate may be rented
for housing, parking a vehicle(s), storage, business,
agricultural, institutional, or government use,
or other reasons.
Who:
The parties involved in the contract, the lessor
(sometimes called the owner or landlord) and the
lessee (sometimes called the renter or tenant) are
identified in the contract. A housing lease may
specify whether the renter is living alone, with
family, children, room-mate, visitors. A rental
may delineate the rights and obligations of each
of these. For example, a "sub-let" to
a stranger might not be permitted without permission
of the landlord. This also applies to whether or
not pets may be kept by the renter. On the other
hand, the renter may also have specific rights against
intrusions by the landlord (or other tenants), except
under emergency circumstances. A renter is in possession
of the property, and a landlord would be trespassing
upon the renter's rights if entry is made without
proper notice and authority (e.g., 24 hours' notice,
daytime, knock first, except for emergency repairs,
in case of fire, flood, etc).
What:
Rented
real estate may include all or part of almost any
real property, such as an apartment, house, building,
business office(s) or suite, land, farm, or merely
an inside or outside space to park a vehicle, or
store things. The premises rented may include not
only specific rooms, but also access to other common
areas such as off-street parking, basement or attic
storage, laundry facility, pool, roof-deck, balconies,
etc. The agreement may specify how and when these
places may be used, and by whom. There may be detailed
description of the current condition of the premises,
for comparison with the condition at the time the
premises are surrendered.
When:
The term of the rental may be for a night (e.g.,
a hotel room), weeks, months, or years. There may
be statutory provisions requiring registration of
any rental that could extend for more than a specified
number of years (e.g., seven) in order to be enforceable
against a new landlord.
A
typical rental is either annual or month-to-month,
and the amount of rent may be different for long-term
renters (because of lower turnover costs). Leaving
a long-term lease before its expiration could result
in penalties, or even the cost of the entire agreed
period (if the landlord is unable to find a suitable
replacement tenant, after diligent pursuit). If
a tenant stays beyond the end of a lease for a term
of years (one or more), then the parties may agree
that the lease will be automatically renewed, or
it may simply convert to a tenancy at will (month-to-month)
at the pro-rated monthly cost of the previous annual
lease. If a tenant at will is given notice to quit
the premises, and refuses to do so, the landlord
then begins eviction proceedings. In many places
it is completely illegal to change locks on doors,
or remove personal belongings, let alone forcibly
eject a person, without a court order of eviction.
There may be strict rules of procedure, and stiff
penalties (triple damages, plus attorneys' fees)
for violations.
How
much:
Rent may be payable monthly, annually, or in advance,
or as otherwise agreed. A typical arrangement for
tenancy at will is "first and last month's
rent" plus a security deposit. The "last
month's rent" is rent that has yet to be earned
by the landlord. The security deposit is often handled
as an escrow deposit, owned by the tenant, but held
by the landlord until the premises are surrendered
in good condition (ordinary wear and tear excepted).
In some states, the landlord must provide the tenant
with the name and account number of the bank where
the security deposit is held, and pay annual interest
to the tenant. Other regulations may require the
landlord to submit a list of pre-existing damage
to the property, or forfeit the security deposit
immediately (because there is no way to determine
whether a prior tenant was responsible).
In order to rent or lease in many apartment buildings,
a renter (also referred to as a “lessee")
is often required to provide proof of renters insurance
before signing the rental agreement. There is a
special type of the homeowners insurance in the
United States specifically for renters — HO-4.
This is commonly referred to as renter’s
insurance or renter's coverage.
Similar to condominium coverage, referred to as
a HO-6 policy, a renter's insurance policy covers
those aspects of the apartment and its contents
not specifically covered in the blanket policy written
for the complex. This policy can also cover liabilities
arising from accidents and intentional injuries
for guests as well as passers-by up to 150' of the
domicile. Renter’s policies provide "named
peril" coverage, meaning the policy states
specifically what you are insured against. Common
coverage areas are fire or lightening, windstorm,
smoke, vandalism and theft.
DISCLAIMER:
This
web site is designed to give you general information.
The information on this web site is in no way intended
to be legal advice. Legal advice can only be obtained
by a licensed attorney who has the appropriate legal
skills and knowledge related to your specific circumstances.
