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.