If you want to diversify your investments, one option you may want to consider is purchasing a rental property. Drafting a comprehensive lease contract may help reduce the chances of interpersonal disagreements between you and your tenants.
The lease agreement is the baseline of your business relationship with your tenants. A well-written contract may be useful if a disagreement leads to litigation.
Legal names and definitions
You must include your full name on the lease as well as the legal definition of the property you are leasing. The title paperwork should include the legal description of your property. According to FindLaw, it is crucial to ensure a lease contract includes the legal names of every adult living in your rental property. When you require every tenant to sign, you give yourself the means to collect rent from any of the renters and to take action if one of them violates the terms of the agreement.
Rules for property care
A thorough screening process for potential tenants may help ensure you get a renter who will take good care of your property. However, it is also important to spell out the details of property care in the lease. You may include rules about pet occupancy. Your lease may also describe both your and your tenants’ responsibilities in terms of general maintenance and repair.
In most cases, you must ensure the property remains livable. The lease agreement may require your tenants to repair any damage they caused and to uphold certain standards of cleanliness.
A lease agreement needs to clearly define the term of the lease and include information on the payment of rent. You may also include details on a security deposit or late fees for rent payments that arrive after the set deadline.