I always tell people never to do anything without writing it down. Heck, I don’t leave the house on Tuesday afternoons without a grocery list, and my day planner is full of sticky notes reminding me to walk the dog or call back Aunt Linda or pick up my kids from school. For transactions that involve money or property, however, it is even more important that you get it in writing. So how do you draft a lease for your rental property?
Before I take you on this DIY guide, you should know that if you hire a real estate agent, you will have access to a pre-drawn lease for your rental property. You won’t have to do anything but sign on the dotted line and make any changes specific to your tenant or property, and this is often the safest way to go. If, however, you prefer to go it alone, you can draft a lease with just a few resources at your disposal.
Search the Internet
You can conduct a search of the Internet to find possible resources for leases on your rental property. Simply type your state and ‘rental agreement’ into a search engine, and you’ll come up with numerous results. You can’t use another person’s rental agreement without their permission, but you can use an example as a guide to draft your own lease. The language doesn’t matter nearly as much as the actual content.
Arguably, the most important aspect you should consider when you draft a lease is the payment information for your rental property. How much must the tenant pay each month for rent? How much is the security deposit? When and under what conditions will the deposit be returned? Include how you will handle late fees, when they are assessed, and how much the tenant will incur. It is also a good idea to include the length of the lease, such as six months or one year.
Next, you will want to draft a lease that includes assignments of utilities. Who is responsible for paying for electricity, water, trash pick-up, gas, cable. Internet and other monthly expenses? If the tenant is responsible for the major utilities, make sure you get their account numbers and the company through which they will obtain those services. Include a provision that says what happens if utilities aren’t paid on time.
Although it is usually called something else, you should always list rules when you draft a lease agreement for a rental property. Requiring tenants to pick up their trash, tend the lawn, pay their bills, and be kind neighbors is a good place to start. You might also have rules against allowing other people to occupy the dwelling, having big dogs, subletting the dwelling, parking in the wrong areas or playing loud music. This depends on you and what you need.
Make sure, when you draft a lease agreement, that you include the policy for maintenance and repairs. How should the tenant tell you about a maintenance problem? How long does it normally take for repairs to be completed? And what should be tenant do in a maintenance emergency? The more details you can give, the better off you’ll be.