Lease agreements can be for a variety of purposes and can be long documents or a simple one-page contract. While it is important to put the lease agreement in writing and to cover as many areas of potential dispute as possible, a rental agreement does not have to be complicated. However, you should include a few critical pieces of information.
Every lease agreement should contain the names of the parties, a description of the property, the purpose of the lease, the length of the lease, the amount of the rent and the frequency of the rent. It should also contain events of default and methods for termination.
Names of the Parties
The names of the parties, of course, are important. It will be difficult to enforce a lease that does not properly identify the parties involved. You don't have to include Social Security numbers or tax identification numbers, but you should have the first and last names or the name of the business involved. Include the contact information of the parties too.
The Term of the Lease
The term of the lease refers to its duration, or how long the lease agreement will last. Typical residential leases have a term of one year, though they can be more or less. Commercial and agricultural leases are usually for one year or more. In most states, if the term of the lease agreement exceeds one year it must be in writing.
The lease should also state whether it automatically renews at the end of the term without a termination in writing.
The Rent Amount and Frequency
Specify the amount of rent in the lease agreement. In addition, the parties should include how often and when the rent is due. The rent for residential leases is usually due on the first day of every month. Commercial and agricultural leases may require rent to be paid twice a year or yearly, although many are also monthly or quarterly.
Description of the Property
For a lease agreement to be enforceable it should contain a description of the rented property. In the case of an apartment, provide the address and apartment number. For larger parcels, such as a farm, it is prudent to include a description by boundaries or by section.
Purpose of the Lease
State the purpose of the lease in the lease agreement. This will limit a tenant's ability to use the premises for other purposes and may also impact the application of certain laws to the lease agreement. Many states have different laws for different types of leases. For example, a warranty of habitability, meaning the landlord must maintain the premises in a habitable condition, is applied only to residential leases in most states.
The parties to a lease may agree to any additional terms they like, provided they are not for illegal purposes. Typical provisions in a lease include a deposit, allowances for pets, the ability of the tenant to sublet the premises, and the payment of utilities. At least consider including these provisions.
Signatures of the Lessor and Lessee
The parties must sign the lease agreement. Everyone obligated under the terms of the lease, such as roommates, must sign. If a roommate's signature is not on the lease, it may be difficult to enforce its requirements – such as rental payments – against the roommate.