A Brief Introduction About Rental Agreement
A rental agreement also goes by the name as a tenancy agreement. It is a type of contract or document between the owner or manager of a property and the renter. The agreement appears as a piece of the signed tenancy agreement that contains information about the property being rented and the initial payment that was agreed upon. Moreover, the rental agreement might also contain information about the overall tenure of the agreement.
Through this agreement, the renter is usually given the clear path to take occupancy of the given rental property. Before applying for the rental lease agreement, it is important for both the renter as well as a property owner to agree upon certain terms & conditions and specify the same in a proper contract or document.
Who Takes the Rental Agreement?
This agreement is usually made between a renter and the owner of the given property. It is the renter who wishes to have the temporary possession of the property owned by an individual. The rental agreement tends to differ from a lease agreement, which is usually based on a fixed term.
On a minimum criterion, the rental contract is known to identify the involved parties along with the given property, the overall term or tenure of the rental, and the total amount of rent for the given tenure. In a typical rent agreement or contract, the owner of the property is referred to as the “lessor,” and the renter is referred to as the “lessee.”
Purpose of the Rental Agreement
While renting out a real estate property, the individual or the party who occupies or lives in the given property temporarily is referred to as the “tenant.” Similarly, the individual or party who owns the property is referred to as the “landlord” or “landlady.” A typical rental agreement might include all or some parts of any real estate including an apartment, a house, or a building, or outside a building under the given real estate law of the region. The tenancy agreement for a real estate transaction also goes by the name as “lease.”
Contents of the Rental Agreement
The rental agreement template that is signed over between the tenant and the landlord, it is known to specify certain contents, including the following:
- The parties involved in the agreement – the lessor (sometimes known as the landlord) and the lessee (also known as the tenant or the renter).
- What the contract is for – the tenancy agreement might include any parts of the real estate property like an apartment, house, business centre, and so more.
- The term of the agreement – specifying how long the agreement is agreed upon between the tenant and the landlord.
- How much – specifying the amount for which the rental agreement has been agreed upon.
Some of the common terms associated with this agreement are:
- Duration – the period of the effectiveness of the agreement.
- Rent –the amount of payment made by the lessee to the lessor.
- Deposits –the amount deposited along with the aim of each deposit and specific conditions for adjustment or return.
- Utilities –the utilities that are included in the rental contract.
How to Draft the Rental Agreement?
When you are renting out a property, it is imperative for you to draft the month to month rental agreement in detail. The house or room rental agreement should be prepared by following the steps as:
- Come up with a proper rental agreement template online for formatting the document.
- Create the title and draft headings for the agreement.
- Outline the provisions of the tenancy agreement that you wish to include in the template.
- Check out the local real estate or rental law.
- Identify the specific property that is covered by the lease.
- List the specific parties to the given agreement.
While preparing or singing the rental lease agreement, you can consider negotiating with the landlord or lessor to be assured of better deals. Here are some pro tips:
- Inquire the landlord if the price for the rental price is open to discussion for some discounts or deals
- Highlight your overall strengths as a tenant. Specify that you are a reliable tenant and always pay the rent on time. It can help in creating your overall worthiness while providing better incentives in the long run.
- Inquire whether or not it is possible to extend the lease
Benefits and Drawbacks of the Rental Agreement
Whether you are considering a room rental agreement or a house rental agreement, some of the potential benefits of the same are:
- Helps in Creating Discussion Upfront: Whether you are creating the room rental agreement or taking part in the same, you can consider making it with or in the company of the tenant such that you are able to discuss ideas as well as concerns at the given moment. When you tend to discuss the issues beforehand and much prior to the final acceptance of this agreement, it will help you in talking about relevant topics that might not be discussed otherwise.
Certain restrictions, as well as in-depth details, can be made available during the discussion and house rules can be specified as well as agreed upon before renting the given space. The written agreement on your rental requirements will also help in setting expectations for both the individual parties.
- Laying the Ground Rules: When you have a proper agreement of rent, it helps in setting equality while ensuring the maintenance of a peaceful environment for both the respective parties. The agreement can be used for informing the concerned parties about the specific limitations as well as awareness of the respective responsibilities.
In case some dispute arises, then the room rental agreement can help in resolving the specific issue. While signing the contract, it is recommended to ask important questions and let the tenant open their respective concerns such that you can add the same to the agreement.
- Serving as the Referee: In case some problem arises with the contract, this agreement will be here for reminding both the parties that they are able to agree on specific terms. Either the tenant or the landlord can proceed with modifying the given situation by specifying certain terms on the contract or document. In most cases, disagreements can be easily resolved by simply reviewing the contract over some legal or court action.
The rental contract will help you in resolving any major misunderstanding as it is known to contain all the respective agreed terms & policies before the beginning of the tenancy.
- Improving the Living Situation: When you tend to live in a rental property, it can turn out to be stressful as a tenant as you might come across several instances –especially if the roommate or rental partners turn out annoying. It is the responsibility of the landlord to resolve the issue by going through the concerns of the tenants and come up with an agreement.
When there is a rental contract, using the same can turn out to be the best approach in resolving the disputes between the landlord and the tenants. The agreement can help in easing down any anxiety the tenants might have with respect to living with one another. It can help in reducing the overall stressful living situation amongst the tenants.
As far as the demerits are concerned, the room rental agreement might leave the tenants to feel constricted or bound to a specific contract for a certain term.
What Happens in Case of Violation?
In terms of the tenancy agreement, most state or federal laws usually state the grounds for the violation of the rental agreement and the necessary steps to be taken afterwards. Some of the typical instances of the violation of a rental contract include:
- Failure to pay the rent.
- Violating some clause of the agreement.
- Violating some responsibility as imposed by law.
Whether you wish to rent a house, an apartment, or a room, it is recommended to go through the entire process of preparing a rent agreement and abiding by the same throughout the tenancy. It is advisable to follow the process of drafting as well as following the tenancy agreement as it can be helpful in explaining the expectations as well as individual responsibilities of both the tenant and the landlord. When you have a specified rental agreement, it allows you to detail the respective rights, responsibilities(2), and restrictions imposed on both the tenants as well as on the landlord.