My entire success as a landlord has been through having an amazing lease that has allowed me to hold my tenant to their written word.
The Quick and Dirty on Writing a Kick Booty Lease
Leases change depending on the state and local rules. Therefore, I always buy the local “real estate lease” from legal zoom. Then I add to and alter the lease based on my experience, keeping the local information.
- I keep the lease blank. This way we can go over the lease together with the tenant filling it out in their handwriting.
- I have the tenants initial after every addendum. This prevents the “I didn’t see it” syndrome.
These are the things that I add to my lease. I have found a strong lease is more specific rather than less specific. For instance, always check your local real estate laws.
Automatic Lease Renewal – After the original terms of the lease have ended, I add a $300 charge to leases renewing month to month. Meaning that my tenant can give me 30 days notice and leave, with no consequence. The same for myself. I don’t want my leases going month-to-month because my markets have definite “time of years.” Therefore this charge helps influence resigning of the lease even if I increase rent.
Late Fees – I charge 10% of the monthly rent because rent shouldn’t be late. Rent is due on the 1st, late on the 6th which includes the 5-day grace period.
Pet Fee: I love pets for many reasons. On the other hand, animal behavior is directly related to the owner’s care. In order for both sides to have “skin” in the game, I have either a $50 a month pet rent OR one months security deposit. I define the exact name and age of each pet. It prevents your tenants from house sitting, fostering, or getting a new animal without your expressed permission.
Utilities: My tenants pay for all utilities including landscaping.
No Smoking: I do not allow smoking and charge a $500 fine in addition to any damages if smoking occurs in the house.
Maintenance: I reserve the right to only pay for repairs that I authorize in writing. I only pay for repairs I approve.
Lease Termination Provision for Military Personnel: My lease allows both parties to be able to break the lease with military orders. This provides us the opportunity for us to move back into the house if we, the landlords, receive orders back to the area.
Tenant Assumes Responsibility for the following Routine Maintenance:
- Granite and stainless steel appliances if applicable.
- Yard maintenance to include mowing, edging, feeding, seeding, maintaining sprinklers, etc.
- Tenant is responsible for the smoke/CO detector. The tenant is responsible for changing all the batteries and alerting (by written notice with a written response signifying the letter has been received) the landlord to when they are no longer in working orders.
- Tenants are responsible for all windows.
- Tenants are responsible for the flooring.
- Air filters are the responsibility of the tenants. Any damage incurred to the AC system by filters or lack of, will be the tenant’s responsibility.
This list is not completely inclusive. Your lease will have more or less depending on your needs.
Steam Cleaning: I require the tenant to professionally steam clean the carpet upon move out and provide the landlord with receipts.
Professional Cleaning: Tenant is required to return the house in the manner such that it appears to be professionally cleaned. If there are any questions, I reserve the right to professionally clean the house at the tenant’s expense.
Landscaping: Tenant is held accountable for all yard responsibilities. Tenant understands that if this house is located in an HOA, they are responsible to abide by the HOA rules. Tenant is responsible for watering the lawn per city code/HOA code. If the yard deteriorates due to mismanagement, tenants will be held responsible.
Fines: Landlords are not responsible for any fines that the tenant receives. All fines will be taken care of by the tenant immediately. Landlord using tenant’s security deposit will pay any fines not paid by the tenants on move out day. A processing fee to equal to the total fine (including fees, penalties and any other charges) will also be taken out to compensate the landlord for handling.
Keys, Garage/Gate Remotes: If tenants or their guests break, lose, damage, or lock themselves out pertaining to keys, garage, or gate remotes then the tenants are responsible for any cost replacement, locksmith, or other cost to rectify the situation. If the locks must be changed for any reason due to the tenant’s fault, the landlord must be informed and provided a set of keys upon the replacement of locks.
Damages: Any monies received, will be applied to damages or fees, first. Rent will be applied second.
Renter’s Insurance: Tenants are required to carry renters insurance in the amount to cover their personal property and liability. Landlord assumes no responsibility toward tenants or any of their guest’s personal property.
Buy Out: This allows either the tenant or the landlord to break the lease without penalty as long as they have provided 60 days notice and a two months break lease fee. Sixty days notice begins on the day that the fee is received. If the tenant moves out before the end of the 60 days notice, the additional days will be assessed as a fee.
Pest Control: Pest Control is the tenant’s responsibility with the exception of termites.
Home Business: Home businesses are not allowed to occur within the house structure or on the premises. Violation is grounds for eviction and a $1,000 fine.40
hey Elizabeth…..Mark from Biggerpockets website.
I was checking out your website. learnt a couple of things……thanks.
I was checking out this page – https://www.reluctantlandlord.net/writing-a-kick-ass-lease/ – Nice!
like the 10% late fee thing…….gonna use it next time!
What I did notice was your link to Legal Zoom at the bottom of the page……looks kinda “scary”! Maybe you should Embed it to the Legal Zoom text. Just a thought, has it been producing commissions for you?
Just a thought.
I like the site, and it has good info…….stole some of the ideas! 🙂 Thanks
I will check out the link. Thanks!! Glad you liked the article.
kaisar sohail says
Look like you didn’t miss anything on the lease.
This is great info! Thanks for posting. I will definitely save this info. . I don’t agree with not allowing home based business. Especially being a military spouse. Many spouses have direct-sales businesses or work from home writing, editing, or doing customer service jobs. I would never not allow someone to rent my home if they had a service based business like one of those. What is your reasoning for this is they have all proper business insurances and if they don’t have clients in their home?
Glad you liked the post! The clause is aimed at those having a “service based” business in their homes, not “working from home”. Since it is impossible to become “more strict” once the lease is signed. I exclude “all business” and than specify as needed. This prevents me from having a day care, hair salon, pet grooming, etc business run in my home without my knowledge or permission.
Dennis S says
Thank you for the post!
I am wondering how do you enforce your leases?
I’ve heard that its quite common for tenants to skip the last month payment, thus voiding the security deposit and in such short time its difficult to evict them. Then they depart, leaving behind trashed property. In fact, my friend just had his tenant do this to him.
Going after them with lawsuits is often financially ineffective.
I have totally had to go to have my lawyer send a strong letter to a tenant to illustrate our seriousness to enforce our lease. That being said, I have never had a tenant use the security deposit as last months rent. I don’t know if it is the fact that I deal with working professionals who have something to lose or because they know I will start eviction process ASAP if they are late, etc. I have a 14 page lease that I totally enforce! Honestly the only times (lawyer incident included) that I have had problems is when I am “nice” and don’t enforce the lease from the beginning!
Dennis S says
Isn’t eviction process takes at least several weeks to get to actual eviction? Even if its started at the next day after the rent is late, the tenant still most likely to be able to stay ’till the end of the month.
The letter from a lawyer is nice but a) its most likely not free and b) it doesn’t have much power besides the “scare” factor.
Going to court is often time- and cost-prohibitive endeavor.
So what do you actually mean when you say that you “totally enforce” your lease?
I understand where you are coming from but I believe you are missing the point. Your right in reality as a landlord you have no control other than what the tenant give you! On the other hand, all the professionals I have in my homes have a lot to lose. Getting eviction records, having liens put against their paycheck, etc. In my experience sending strong letter from me, or in one case a lawyer ($600) has been enough to prevent any and all further issues. I have been doing this for 3 years with 5 turn overs and 11 tenants right now. I have never had those issues!
Hey Elizabeth, I am a new investor in the Hampton Roads area with my first rental property and I am just getting all my documents setup (aka my lease). I looked at legal zoom for a Virginia State lease agreement and then they begin asking you all the questions to personalize it to the prospecting tenant and per unit. I was looking to get a generic lease that covered all state requirements so I could add the addendums (pet agreement, late fee) and all that myself. Which lease agreement do you normally buy from legal zoom so its just the bones of what i need?
I bought the regular version from legal zoom. I was able to personalize it on the site and further once I bought the lease. I will be honest. I haven’t had to buy a new one in almost 2 years. If legal zoom doesn’t work there are many “similar” websites.
I listened to your podcast at BP and came to your website. I am impressed on how you manage your properties long distance. I have few out of state properties that I use someone to manage but the result is not turning out as I expected. I do pick up some ideas and learn from your posts. Great work!!!!!
Thank you for the kind words!
Brian Spink says
Any chance you would allow website visitors use/buy the lease you have created with experience behind it rather than try to start from scratch? Either way, thanks for the content and advice.
Unfortunately as I am not a lawyer all I can do is share my experiences. Good luck! Glad you like the site
Daniel Borrero, Jr. says
I have been a landlord since 1990. You are giving great advise. However, I would add in the cost per item of any deductions from the security deposits when the unit is vacated.
For Example; Cleaning of stove $75.00 , Removal of a furniture is $75.00 per item,
I also have the new tenant sign pictures of the condition of the unit before they have taken place.
This is awesome!! I love your website because I am completely new to managing my own property (our first house currently has a property management company). Thank you for the legal zoom info because I didn’t know where to start.
You replied to one of my BP posts almost a year ago and I always remembered your site, but now I’m utilizing it to the fullest! Thanks again!!!!
Elizabeth Bennett Colegrove says
Glad you like the site!! Thank you for checking it out.
adon boyd says
About the landscaping, do you ask the Tenant to also take care the lawn care (fertilizing)?
Elizabeth Bennett Colegrove says
Yes, I require my tenants to cover everything to do with landscaping.
I am embarking on managing from out of state too. Do any of your properties have a pool? Do you make the tenant responsible for the routine cleaning and treatments and you as the owner take care of the big ticket, fixed in place (pump, filter, etc.), maintenance?
Elizabeth Bennett Colegrove says
Our current house has a pool. We are renting it out this spring for the first time. I plan on making the tenant responsible for routine maintenance and we will cover the big ticket items. I plan on having my $100 deductible continue with the pool. This way there is skin in the game for the tenants to stay on top of the routine maintenance.
How do you, or how would you, handle landscaping and snow removal in a multifamily (3-4 family)? Would you assign it to one of the tenants for a slightly reduced rent, would you hire a professional service, what would you do?
Elizabeth Bennett Colegrove says
I would hire a professional service unless everyone had their own space. For example base housing at our last base everyone mows their own backyard because it was fenced. I personally am not a fan of the reduced rate, because it often is the same or close to what a professional cost, without mixing business and tenant relationships.
Over the years we have taken in many people to live with us at no charge for short-term stays up to about 3 months. We have run into a problem that we have never had before. We are now in the process of building a suite in our house and a young couple needed a place to live. They are “co-living” with us now until the suite is built and then they will be moving into it. They use many scented products such as laundry detergent and softeners, perfumes, bathroom sprays etc. The smell is so strong and triggering allergies for some of us as well as friends who come over. Is it reasonable to say “no scented products”? What about once they move into the suite? I know that the scents will still be able to be smelled once they are in the suite.
They are great people and we will talk to them about this but I’m wondering what is a reasonable expectation.
Question regarding Renter’s Insurance. I’m in a college town and we target primarily graduate students. Young and invincible, not to mention cheap, they by and large have no interest in spending the $10-15 a month for renter’s insurance. How exactly do you require it? Or confirm that they have and/or keep it? What happens if they don’t get it or cancel it? Thanks!
Elizabeth Bennett Colegrove says
It is in the lease. You can have them put you as an additional insured. That way you are notified if they cancel it.
Gail A Aiken says
In reply to your last response on renter’s insurance, do you require them to have this insurance prior to handing over the keys? I could see tenants not getting around to it once they are moved in.