If you own a piece of residential property and you are thinking of renting it out, you may be concerned with the legalities of taking on tenants. It is important to understand the role of each party in a residential lease agreement.
The Lessor is the landlord or the owner of the residential property. They will be responsible for the upkeep of the property. Different states have different laws, but they must generally ensure the safety of a property. If a component of a rental property should break, such as a water pipe or an electrical outlet, the landlord is generally responsible for replacing it.
If a landlord has incorporated themselves as a limited liability corporation or partnership, they will sign as an entity of that business. The financial risk will be assumed by the business itself. If a landlord is signing as an individual or sole proprietor of a business, they will simply sign the lease for themselves and assume all the responsibility of entering into that legal contract.
The lessee is the person or persons who will occupy the apartment for the time period specified in the lease. In some cases, a corporation may rent out an apartment on an individual’s behalf. Normally every person over the age of 18 years old who occupies the apartment must sign the lease.
Each state has different laws for the exact details of a lease. In a situation where roommates will be sharing an apartment, they will normally be equally responsible for the amount of rent to be paid each month and for fulfilling the terms of the lease. It is always a good idea for roommates to have a separate agreement with one another.
If you are renting your property out as a student apartment, there are some states that will allow you to have a separate agreement with each individual roommate.
The lease should list all the residents of the apartment, including underage children and pets. It should specify any conditions you have for animals in the house for further use of the backyard.
As a lease is a legal contract, there are some states that require you to have a witness to the signing. The states of Connecticut, Georgia, Louisiana, and South Carolina require that there are two witnesses present at the signing of any lease.
Creating a Lease
You may be wondering if you should get an attorney to write you a lease or if you should just buy a standardized lease at a store such as Home Depot.
Unless you have several large properties with many units, It may not make economic sense to hire an attorney. According to the website ezLandlordForms, generic forms that are available for purchase may not take specific state laws into consideration. There are websites you can go to that offer tools to create personalized leases. They will be able to instruct you on the laws of your particular state.
Renting out a property can be very profitable. A landlord provides a very important and necessary service to their tenants. Having a clean, well-written lease that specifies your expectations of one another can help you avoid the pitfalls and make the experience an enjoyable one.