The rental market is more competitive than ever, and landlords are finding a bevy of tenants to choose from as more Americans forgo purchasing property in favor of renting. Whether you’re new to the landlord-ing game or are ready to place the nth tenant in one of your many properties, there’s much to be said about taking the time to tailor and edit your lease. With competition as it is, landlords have a mightier sense of choice, and if you want to be sure your tenant-landlord relationship goes off without a hitch, make sure to implement the following clauses and provisions.
Joint and Several Liability
Make sure you get your rent in full, especially if you’re renting out a property to multiple
individuals. A joint and several liability clause means that each tenant is jointly and
individually responsible for ensuring you receive the entire rent amount each month and
for any damages that might be incurred. This provision basically allows you (and more
importantly, the law) to view all of your tenants as a single entity. This doesn’t only
matter for collecting rent; it also allows you to give notice of eviction, serve any court
documents, or sue for damages.
Worried About Pests
You might have done everything right and ensured the house or apartment was pest-
free when your guest moved in, but you can’t control their hygiene or cleanliness habits.
Including a pest clause will allow you to place responsibility for the arrival of pests on
your shoulder. Pest control can cost upwards of hundreds of dollars to correct, and you
won’t want to be on the line for a pest that arrived because of tenant habits.
A sublet clause is essential. In some areas and situations, it might make sense to allow
your tenants to sublease; for example, in a college town. College students often leave
for months during the summer or go abroad for a semester, and they may wish to retain
their spot for when they return so it may be more beneficial and profitable for you to
allow subletting—just ensure you lay out your terms. If you do allow tenants to sublet
their rooms, you’ll want to ensure your income stays the same, and it’s essential to
screen subleasing tenants properly with a service like MySmartMove, even if they’re
only staying in the property for a month or two. However, if you don’t want to allow for
subletting, make sure you write that explicitly in your lease. Tenants may invite
strangers into your property, without letting you know or vetting them properly for
criminal pasts. Without a provision in your lease, you won’t be able to penalize them for
it, and your property will be vulnerable to strangers that you haven’t approved.
Make Renter’s Insurance Non-Negotiable
Landlords are increasingly requiring their tenants to purchases individual renter’s
insurance, and for good reason. The insurance you have on your property doesn’t cover
a surprising amount of expenses should an emergency situation arise. For example, say
a natural disaster like a flood or fire happens—landlords can find themselves liable for
the costly deductible fees required for damage repairs. It’s wise to ask your tenants to
send you proof of their renter’s insurance each time the lease is renewed, and it’s
important that you do your homework and have a solid grasp of exactly what damages,
repairs, and costs their insurance plan covers.
A Severability Clause
The law is almost always on the side of the tenant, even if it seems explicitly clear that
fault lies with them. That’s why a severability clause is so important. This provision is a
vital precaution, stating that if one aspect of your lease is determined to be illegal, the
rest of the lease still stands. If you don’t have a severability clause if a small clause in
your lease is found to be illegal, even if unintentionally, a judge might conclude that your
entire lease is null and void.
When crafting or editing your lease, keep these clauses and provisions in mind. Always
speak with real estate legal counsel, and make sure you set your property up to be
profitable without making your personal assets vulnerable.