As an investment property owner, there are many things you need be sure to include in your renter’s lease agreement. By having an iron-clad lease, you will be able to avoid costly consequences down the road. In our latest post, we discuss several things you need to be sure to include in the lease agreement of your Chicago property.
While most agreements are boilerplate, there are a number of things landlords will forget to include in their lease agreement that can come back to bite them later down the road. It is ok for your lease to be lengthy. Being detailed will save you from any questions or discrepancies that may arise with your tenants. A detailed lease will protect both parties in the long run.
Key Things To Include
Every lease agreement should include the obvious fundamentals such as the full names of all tenants occupying the property. The property’s address, lease terms, amount of rent, due dates, and penalties and fees for things such as breaking the lease or late payment of rent. You should also include the payment procedure and methods of payment you will accept as to avoid any confusion about getting your money.
You should boldly state exactly how many people are allowed to live in the house. Every resident needs to be on the lease. You don’t want to find out there are 10 people in your two bedroom house. You can even make notes about limiting overnight guest. If someone is spending every night there, their name needs to go on the lease.
Deposits And Other Fees
As mentioned above, and fees or penalties should be clearly explained in your lease. Will fees for late payments be assessed by the day or a flat fee? Will you offer a grace period? How will you handle illegal activity or other lease violations? You will need to clearly explain the required security deposit and the reasons for deductions upon moving out for cleaning and repairs.
The Handling Of Repairs And Maintenance
Define your process for reporting and handling maintenance issues. Outline the timeframe a tenant can typically expect for repairs to be made. If the tenant is responsible for damage, explain how they will be accessed. If they choose to repair on their own, you will want to explain your process and rules for this as well.
Explain the reasons why you would need to enter the property and how much notice will be given. The tenant will need to allow access for regular inspections, repairs and of course in the case of emergency.
Additional Items To Consider
Depending on your property, there are all sorts of additional provisions you can include.
Rules For Subletting
If your tenant needs to suddenly move in the middle of their lease term, will you allow them to sub-let? If so, how will this process be managed?
Many tenants will like to paint, add shelving, and create other modifications to make the property feel like home. Outline what is acceptable and not acceptable. For example, list acceptable paint colors, rules for putting holes in the walls, what is allowed to be changed in the yard.
While many people out there have pets, it can be difficult as a landlord to know if you should allow them or not. Not all cats and dogs are alike, and neither are their owners. Some might scratch up the walls, and some owners have different levels of acceptable cleanliness. If you do allow pets, specify what kind, the weight limits, and if there is any additional deposit required.
You could also include rules for things like parking, noise, and shared amenities.