Lease Agreement And Its Essential Clauses

Disputes between landlords and tenants are increasing drastically. Different reasons can cause it. The main cause of these conflicts is a lack of understanding or awareness about the terms and conditions of the stay. This is why lease agreements are important at the time of rental. As we all know, a lease agreement meaning is a significant document that is considered a contract between the owner and the tenant. It includes terms and conditions, lease duration and rent payable amount. The major use of this document is to avoid disputes or conflicts between both parties. At the time of the lease, both parties, i.e., the landlord and tenant, will read and understand the lease agreement and ensure that it is lawful. Let us get more insights into what is a lease agreement and its significance.

As mentioned above, lease agreements are contracts between the landlord and tenant, including terms and conditions at the time of stay. They also include several terms and clauses. Let us look into the clauses of a lease agreement.

Essential clauses of Lease Agreement

A rental agreement is irrelevant without terms and conditions. Proper clauses in apartment rental agreements avoids confusion or disputes.

1. Rental Term and Payment in Lease Agreement

The rental term refers to the duration of stay. In a rental agreement, the beginning date and end date will be present. The end date is the date when the contract terminates. The payment section includes all the details regarding the rent amount, due dates, and method of payment. Moreover, the owner can charge penalties for late payment if needed. These details will be included in the rental agreement. Both parties duly sign the lease agreement.

2. Security Deposit

Security deposits are money that must be paid to the landlord at the time of the lease agreement. They remain in the owner’s hands as long as the tenant stays. The landlord also refunds the security deposit after the termination of the rental agreement. If the tenant causes any damage during the stay, the landlord will deduct it directly from the deposit paid by the tenant. The lease agreement will include all the details, such as conditions, deductions, and other terms.

3. Permitted Uses and Restrictions

An owner can decide what the tenant can access or use inside the property. This particular clause clearly mentions the property’s permitted access or use and restrictions. These may include restrictions on smoking, drinking, partying, or the use of substances inside the premises.

4. Maintenance and Repairs

The properties are subject to repairs. Proper guidelines on the responsibility of repairs will be provided in maintenance and repairs. It defines who is responsible for maintenance. It gives the details of the assigned party. However, if the tenant causes the damages or repairs, then the landlord can deduct them from the security deposit. All these terms and conditions are included under the maintenance and repair section of the rental lease agreement.

5. Subletting and Guests

The landlord or owner has the authority to allow the tenant to sublet or host guests. The terms regarding subletting will be present in the lease contract. Subletting allows a third party to stay in the property with the owner’s permission on an agreed-upon rent.

6. Late Fees and Other Charges

Late fees are the charges when a tenant fails to pay the rent before the due date. It is a percentage or a fixed amount of the rent that is payable to the owner. Other charges refer to the charges such as heat, water, electricity, wifi, etc. The details with the amount will be added to the lease agreement.

7. Renewal Options in a Lease Agreement

A lease contract will clearly describe the renewal options and terms for renewing the lease. The process to renew the lease and the conditions to renew it is mentioned at the time of the initial lease of the property. Furthermore, terms such as the amount to renew, the duration, details regarding maintenance, subletting, and all other terms will renew at this time. All the dues have to be paid before the renewal. Moreover, the tenant and the landlord will have to agree with the renewal terms and conditions in the rental agreement.

Conclusion

In short, a lease agreement is a contract between the landlord and the tenant duly signed by both parties at the time of rental. Both parties have to know and understand the terms and conditions. The rental agreement will clearly mention details regarding the rent, duration of stay, termination, restrictions, subletting, security deposit, and renewal options. Therefore, it will avoid disputes between both parties and enhance the landlord-tenant relationship.

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