Understanding a Lease Agreement

If you plan on staying in an apartment for more than a month, chances are you'll have to sign a lease agreement.

Understanding a lease agreement isn't too difficult. The main thing to understand about a lease is that it sets a term - usually six months or a year but sometimes longer - during which you have the right to rent the apartment without the landlord raising the rent or changing the tenancy terms.

A rental agreement is usually for 30 days at a time and automatically renews at the end of the period unless the tenant or landlord gives written notice to end it earlier. A lease agreement, however, isn't automatically renewed when it expires, although a tenant can stay on with the landlord's consent on a month-to-month basis.

A lease agreement is typically used for long-term rentals, such as up to a year. A rental agreement is typically used by someone who may want to the flexibility to move out within a month's notice. Having a long-term lease agreement, for example, would require the renter to fullfill the entire length of the contract, typically a year.

Another key part of understanding a lease agreement is to take a close look at the lease options written into the agreement. Beyond setting a length of time for the rental, you may also have options about the size of the apartment, and key features such as having a dishwasher and washer/dryer hookups.

Always understand what you sign before signing a lease agreement. Never let your landlord fill in the lease details later - don't let any blanks spaces remain when you sign it. And get a copy of the lease immediately after you both sign it.

Terms to Avoid

Keep an eye out for the following lease terms:

  • Shared utility meters. Have the bill put in your name and make sure it covers only your utility charges. You don't want to have to pay for your neighbor's habit of leaving the lights on all night.
  • Automatic rent increases. Don't agree to provisions allowing the landlord to raise rent if operating costs, taxes or utilities increase.
  • Future rules of landlord. Don't agree to obey any rules the landlord will set in the future because they may be unduly restrictive.
  • Provisions absolving the landlord in advance of any liability for carelessness. Most courts wouldn't enforce these "hold harmless" clauses, but don't allow them in your lease agreement anyway.
  • Allowing unrestricted entry to the landlord. Many states control how, when and for what purpose a landlord may enter. It's an intrusion on your privacy.
Aaron Crowe has lived in at least five rental properties in the San Francisco Bay Area. Reach him at www.AaronCrowe.net
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