There is a common practice in most of the western countries to enter into a rental agreement while renting a home or an apartment. In the recent times, people from all over the world have understood the importance of rental agreements. In the golden old days, the verbal agreement was widely used and stood as the witness of everything.
But today, as people have become highly self focused, the verbal agreements have lost their standings. Instead, the popularity and importance of written rental agreement has increased to a great extent and it is widely used as an effective tool to protect both the tenant as well as the landlord.
Importance of Rental Agreement:
The written rental agreement provides a crucial piece of witness for the landlord that he is the owner of the property and the person who is living in it has rented the place. On the other hand, the rental agreement provides security for the tenants against the dispute and illegal financial demand by the landlords. This rental agreement is also crucial, especially if the tenant makes any security deposit.
This acts as a written proof that depicts the amount of security deposit made by the tenant and it has to be refunded by the owner at the completion of rental period. In contrast to that, the written agreement is crucial even for the landlord if he has not obtained any cash as security deposit. In this scenario, the landlords are protected against the unlawful demands of financial repayments by the tenant on the later date.
Why A Property Owner Needs A Rental Agreement?
Writing a vigilant and professional rental agreement is one of the most crucial things that you must do when you are getting ready to rent your residential property to the tenants. The rental agreement protects you from anything that gone wrong. By having a carefully crafted rental agreement that contain all essential elements that it must boast and complying with the specific state laws, you can make sure that you can take all necessary actions when it is essential to reclaim your property and damages caused to it. With the help of sample rental agreement format, you can determine what should be included in your rental contract.
How To Create A Rental Agreement?
First of all, you should understand the difference between rental and lease agreement. In fact, there are different ways of creating a rental agreement. There are several websites which offer free templates that can be downloaded at free of cost. By making some necessary editions as per your requirements and based on the condition of your property, you can come up with an effective rental agreement.
This option helps you in saving a lot of time as you need to make only the editions. You can either type an agreement from the scratch or use a sample to get an idea about the necessary elements that should be included in the rental agreement. No matter whether you prefer using sample rental agreement format or preparing your own, it should include everything that one must have.
Instructions for Creating a Rental Agreement:
The agreement should include the name of tenant and landlord as well. Information like address of the property and the date when the agreement begins and concludes should also be notified.
Monthly rental fee, monthly rental data, returned check fee, late charges and address where the payment should be made should be stated in the agreement.
Disclose what the consequences will be if the tenant fails to pay the rent on time. Listing out the amount of security deposit is also important.
Spell out who should pay the utility bills: whether the landlord or the tenant? Listing out how many tenants can live in the property is also essential.
List out all the rules and regulations like whether the tenants can have pets or can smoke within the property.