9 Policies You Need To Include In Your Rental Agreement

9 Policies You Need To Include In Your Rental Agreement

A rental agreement outlines all the rules and regulations to be followed by landlords and tenants during their rental relationship. A rental application is an immensely practical document detailed with significant details, such as the amount of rent, how many tenants can occupy the property, pet policy, and other crucial details that need to be followed by both the tenant and landlord.

The document needs to be clear and meticulous, covering all the basic terms of tenancy, to avoid any disputes in the future. Here are some important points that need to be covered in the rental application.

1) Fundamental policies

Your rental application must include basic clauses such as the name of all the parties, including the tenants and landlord, the address of the property, and the term of the lease.

2) Security deposits

Your rental application must clearly state the amount of security deposit that a tenant must provide before moving in. It can be equal to one month’s rent or more, depending on the value of furnishings and other costs, if something goes wrong.

3) Number of occupants

You should clearly specify the number of people that can reside in your property in the rental agreement. This gives you the right to limit the number of occupants and decide who lives on your premise. This will also help you take strict action in case the tenant moves in new members or sublets without your permission. Additionally, there are also laws that limit the number of people that can reside in a fixed area, so be sure to check those regulations if you’re renting to multiple tenants.

4) Rent

Your rental application should specify the amount of rent, when it is to be paid, and how it is to be paid. To avoid any disputes in the future, include the following details:

  • Acceptable mode of payments
  • The amount of late fees if the rent is not paid on time
  • If you choose to offer a grace period for a late payment

5) Pet policy

If you choose not to allow pets, be sure that your rental application specifies it. If you do accept pets, ensure that you identify any specific restrictions such as the type of pets, size of pets, and the number of pets. Also, make sure that you make it clear that the tenant will be responsible to keep the property as well as common areas free of animal waste. Some landlords may charge an additional security deposit for potential damage a pet can cause. Also, be aware that there are special laws regarding service pets, owned by people with disabilities or illnesses, that you must follow in order to avoid discrimination claims.

6) Maintain the property

The rental application or rental agreement should spell out who is required to maintain the property and pay for utilities. You must itemize all the furniture and appliances present in the property, and take a due note of their condition and any other special consideration. It is important to clearly write all the details, and not depend on oral promises.

7) Subletting

It is possible that in the future your tenants might want to sublet your property to a stranger or a friend. Including a subletting clause in the rental application will give clarity as to whether or not your tenant is allowed to sublet.

If you allow subletting, make sure that you begin the process from scratch with the new tenant including a rental background check. You must ask the tenants to fill a new rental application form without depending on the old lease.

8) Termination

Termination laws differ from state to state, so make sure to check with your state judicial regulations to ensure you abide by all the rules. Termination can arise at the end of the lease period or during an eviction. It is important to state the rules for the eviction process, as it is the most complex process of tenancy.

9) Other restrictions

Ensure that you follow all relevant state laws while creating your rental agreement. Any other restrictions regarding illegal activity, businesses a tenant may run from home, rules for using the common areas, parking fee payments and the number of vehicles that can be parked should also be spelled out in the rental agreement.

By designing a comprehensive rental agreement with all the necessary clauses, you will be able to settle any future disputes in an amicable way. Being upfront with tenants ultimately will build a strong rental relationship.