Strategies for using a Rental Lease in Real Estate
A rental lease is a written rental contract binding the parties involved for a specific period of time with a definite starting and ending date, usually one year. A lease will protect the tenant from rent increases and changes in terms unless the lease provides for those changes.
A landlord cannot force a tenant to move out of the unit before the expiration date of the rental lease unless the tenant fails to pay rent or violates some other term of the lease or state law. Typically, a rental lease cannot be terminated without a reason; however, it may be terminated if the tenant or landlord gives proper notice for termination, which is usually sixty days.
This contract may be renewed if, at the end of the lease, the tenant re-signs the rental lease. Terms in the rental lease can also state that the terms will stay in effect after the expiration date, until the tenant re-signs a new one. It is important to keep in mind, that a lease is not as flexible as a rental agreement and as a result, protects a tenant for a fixed period of time. The tenant is protected with the current owner and any new owner of the property including a bank if the property is foreclosed upon.
In order for a rental lease to be valid, it must meet certain requirements in the same way that other contracts have to. First, the parties must reach a mutual agreement regarding all the terms of the contract. Secondly, the contract must be supported by a form of legal payment, usually rent. The parties involved must have the legal capacity to contract.
Lastly, the objectives of the rental lease must be legal, so be sure to take care in making sure you understand both your rights and the rights of your renters to avoid any problems with your lease. Making the investment to have an attorney read over the agreement to ensure its effectiveness can save you a lot of time and money down the road.