A Closer Look: How to Read Your Lease

By Brittany Loeffler on October 31, 2017

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Chances are that you will be renting an apartment at some point between going to college and buying your first home. For many, a lease may be the first important legal document you have ever signed, which is why it is extremely important to learn how to read your lease and what to look for.

Before signing any legal document or committing to anything, it’s important to read the document carefully. Whether this is an insurance plan, a phone contract, or anything that holds you responsible for something, always take a closer look and read it carefully.

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Understanding a lease

When you lease a residence, the owner (landlord) of the property is transferring possession to you for a specified amount of time in exchange for compensation of value; in this case it will most likely be money. Most states require a lease to be written and signed by both the landlord and tenant. Leases will have clauses, rules, and regulations specific to the property.

A lease should clearly have a description of the property (the address), the term of the lease, the annual rent amount as well as for each month, when rent is due, the landlord’s name and contact information, and the tenant’s name.

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Rent & Security deposit

When reading your lease, make sure to check how much you will be paying in rent each month. The lease should state both how much rent is due each month and how much will accumulate during the term of the lease. The lease should also say which forms of rent is acceptable, when rent is due, and if there is a grace period and late fee.

Most landlords will ask for an upfront security deposit. This is typically equal to one month’s rent and will be used if any damages are caused by the tenant during the lease term. The amount of the security deposit should be written in the lease.

Utilities

There are more expenses than just rent. Each month utilities such as electricity, gas, water, and cable will need to be paid. Sometimes the landlord will take responsibility for some if not all of the utilities needed to keep the property running.

Check your lease to see what costs the landlord is responsible for and what you are responsible for each month. This will give you a better idea of how to budget your money each month.

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Maintenance & Repairs

The great thing about renting a property is that you are not responsible for any major damage to the property. If a water pipe bursts and it is not your fault, the landlord must fix it and cannot make you pay for it. However, some repairs and damages that are caused by the tenant may be taken out of the security deposit that was paid up front.

Read through the lease to gain an understanding of what exactly the landlord is responsible for, what type of maintenance will be performed, and who to call for repairs to the property.

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Pets

Do you have a pet that you plan to take with you? Read through your lease to see if there is a clause about pets. It’s up to the landlord to let pets live in their property or not. They may allow dogs, but have restrictions as to what kind of dog, how big the dog can be, or how old it can be.

If the landlord allows tenants to have pets, there will most likely be an additional nonrefundable security deposit that must be paid up front for any damage the animal does or the cleanup that must be done once the tenant moves out.

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Renewal process

Every lease is different, which means not all leases will end the same way. Some leases turn into month-to-month leases or renew automatically for another year. It’s important to find out what the renewal process is with your landlord and how much notice you must be given before moving out of the property.

Breaking the lease

If for some reason you must break your lease, there are penalties you must pay. These should all be written out in the lease. Some landlords may require you to pay the rent for the remainder of the lease in order to break it. Some landlords may require you to find someone to take over your lease, which is called subletting.

This is important information to know, which is why you should read through the lease thoroughly before signing.

via Pixabay

Illegal lease clauses

A contract is only as good as the people upholding it and the legality of the content written. For example, if a landlord specifically states that they are not responsible for any maintenance or repairs, no matter how big the problem is, the lease is voidable. The law states that a landlord must be responsible for major repairs for a leased property and must keep the property in a habitable condition.

If you are reading through your lease and you find something that doesn’t sound right, make sure to look it up. Read through landlord-tenant laws of your state and city to make sure you are signing a legal lease.

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