Understand and negotiate your lease before signing


I’m a landlord, and I’ve often been a tenant.  As a result, I often hear from both landlords and tenants about some way that they are unhappy with their landlord-tenant relationships.  No matter which side of the equation you are on, that’s no fun.  Tenants shouldn’t have to live in poor conditions or feel like they are “getting screwed” by their landlord.  Landlords, many of whom have no interest in being landlords, are understandably worried about their biggest investment and whether they’ll be able to pay the bills next month.  (We’ve talked about the perils of homebuying elsewhere.)

Thankfully, there is a tool that can help both tenants and landlords to navigate their relationship:  a well-written lease.  And here’s the thing about a lease:  you don’t have to take what you’re offered.  Most importantly, the time to make sure your lease is clear is before you sign it.

Note:  This article may seem like it is aimed towards landlords.  It’s not.  It is for both sides of the rental agreement.  Be sure to keep reading to see why tenants need to be knowledgeable about all these issues.

Preparing A Lease

Generally speaking, the landlord is expected to have a lease that they want to use.  Landlords should take the time and expense to draft a lease that clearly defines their expectations and responsibilities of both part.  Landlords, this is your opportunity to express the things that are important to you.

There are a lot of things you want to include in your lease.  Here’s a list, not at all comprehensive, to get you thinking.

Utilities:  Who pays for what, who is responsible for moving accounts, penalties for not starting the utilities on time, etc.

Repairs:  Do you expect the tenant to handle any repairs at all?  What counts as a repair?  Replacing light bulbs?  How about air filters?  Cleaning the filter of the dishwasher?

Questions about evictions/bankruptcies/etc. And misrepresentations clause.

Breaking the lease:  are there any situations under which the lease may be broken?  Is there a fee?  Is there a notice requirement?  Are there other special instructions?  Do you grant the standard federal military clause?  Does your state have different laws?  What about a “reverse military clause?”

Pets:  are they permitted, is there a fee, do they have to be named, what happens if unauthorized pets are found, do you require insurance or other documentation, special cleaning requirements (carpet, yard, air ducts), pet poop removal charge.  Description of what counts as having an unauthorized pet?  What counts as a pet?  Fish?  Lizards?  Guinea pigs?  Are they allowed to pet sit?  What if a guest brings a pet?  When is this acceptable and not acceptable?

Smoking:  Is it permitted?  If not in the house, how far do they have to be?  How much will you charge for remediation for smoke smells?  What about picking up cigarette butts?  Definition of who gets to decide if the house was smoked in.

Septic/Plumbing:  Who is responsible for keeping the plumbing running smoothly?  What items will you charge the tenant for?  Will you expect them to do any basic repairs?  (Tightening faucets, replacing the insides of toilets, Are they permitted to use those “flushable” wipes (that aren’t really flushable.)  Do you have a septic tank?  What kind of care does it require?  Who is going to do that?

Lawn Care:  be painfully specific.  Cutting the grass, edging.  Do you want them to trim bushes or not?  What about weeding beds?  Trimming trees?  Do you have a Homeowners Association that has opinions about grass and yard maintenance?

Gutters:  Who is responsible for cleaning the gutters?  How often?  What happens if they need work in between cleanings?

Showings:  Will you want to show the property at the end of the tenant’s term?  How much notice will you give?  How much will you show it?  Will you expect it to be clean, and how do you define clean?  What if they have pets?  Will you want them to be home or go away for showings?  What will happen if they don’t comply with your requests for showings?

Candles:  Do you want to prohibit them?  What if they cause damage?

Mold due to tenant belongings/negligence:  I know this sounds crazy, but the possibility is real.  Let’s say your tenant has been stationed in Hawaii, then comes to your house.  Their shipment sat on the dock in Hawaii, and water got into the crates.  Their stuff gets moldy, then gets delivered to your house.  They can’t throw it out, because they are filing a claim.  The mold travels from their stuff to your drywall.  Now what?

Locks, keys, and alarms:  Who can change, and when?  Is permission required?  To whom do new keys need to be provided?  What happens if the locks are changed and keys are not provided?  May the tenant install an alarm system?  Does it require permission?  Do they need to provide the code to anyone?  Does your county or local area have any rules or regulations about alarms?

Insurance:  Do you want your renters to have renter’s insurance?  Should it include liability coverage?  How much?  Flood insurance?  Do you want to be named as an additional insured?  How will you enforce this?  Do you need a copy of the policy?  Is there a penalty for not keeping insurance in force?

This may take hours of time, and you should probably have it looked over by a lawyer to ensure that the terms are legal in your state and local jurisdiction.

Understanding and Negotiating The Lease

If you’re the tenant, you will probably be presented with the lease that the landlord has already prepared.  Maybe they’ve considered all the things listed above, but probably not.  You might get a generic one page lease that doesn’t really specify anything.  That may seem great, but it’s not.  A short, simple lease does nothing to explain the expectations of each party, won’t provide any guidance if the two parties disagree, and won’t help if you end up in court.

Step one is to read the lease presented to you, and to make sure you understand all the terms.  If you’re confused, your base housing or legal office should be able to help.

The second step is to make sure that you agree with all the terms that are listed.  If you don’t want to be in charge of cleaning the gutters, the time to think about this is before you sign the lease, not when water is pouring into the basement because the downspout is clogged with leaves.

Third, consider things that aren’t included.  If cleaning guidelines aren’t clear, ask to have them added.  If the lawn care section is vague, ask to include more specific language.

Then, take your questions and concerns to the prospective landlord.  This can be a little tricky.  If you’re renting from a company, they may not be interested in changing their lease.  Private landlords may be surprised and initially defensive.  Most landlords aren’t expecting a thoughtful and knowledgeable tenant to come back with requests for clarification.

One way to possibly allay a prospective landlord’s fears is to explain that you just want you both to be clear about expectations and protected in the event that something goes wrong.  Keep in mind, many landlords aren’t professionals.  They’re just other military folks that bought a house that they now can’t sell, and they’re renting because they don’t have other good choices.

There is a fine line here:  you have to know your market, how much you want this house, and how much you will or won’t negotiate to get it.  If it is the perfect house in a tight market, you might have to give a little on lease negotiations and hope that it all turns out for the best.  On the other hand, you may feel safer if you have a watertight lease that is clear and protects you from misinterpretations.

The most important thing to take away from this is that once the lease is signed, its terms and provisions are valid.  You can’t come back six months later and say, “I didn’t want to be responsible for all those little repairs” or “I shouldn’t have to cut back those huge bushes.”  (I’ve heard both landlords and tenants say things like this.)  Taking the time and energy up-front to craft a thoughtful, comprehensive lease will save a lot of heartache down the road.

By Kate Horrell, Military.com

More at Military.com: