Leases and Rental Agreements FAQ

What you need to know to create a legally valid lease or rental agreement.

Do I need a written lease or rental agreement?

The lease or rental agreement is the key document of the tenancy, setting out important issues such as:

• the length of the tenancy
• the amount of rent and deposits the tenant must pay
• the number of people who can live on the rental property
• who pays for utilities
• whether the tenant may have pets
• whether the tenant may sublet the property
• the landlord's access to the rental property, and
• who pays attorney's fees if there is a lawsuit concerning the meaning or implementation of the lease or rental agreement

Leases and rental agreements should always be in writing, even though most states enforce oral (spoken) agreements for a certain period. While oral agreements may seem easy and informal, they often lead to disputes. If a tenant and landlord later disagree about key agreements, such as whether the tenant can sublet, the end result is all too likely to be a court argument over who said what to whom, when, and in what context. This is particularly a problem with long-term leases, so courts in most states will not enforce oral agreements after the passage of one year.

For information about what to include in a lease or rental agreement, see the article Ten Terms to Include in Your Lease or Rental Agreement.

What's the difference between a rental agreement and a lease?

A rental agreement provides for a tenancy of a short period (often 30 days) that is automatically renewed at the end of the period unless the tenant or landlord ends it by giving written notice. For these month-to-month rentals, the landlord can change the terms of the agreement with proper written notice.

A written lease, on the other hand, gives a renter the right to occupy a rental unit for a set term most often for six months or a year but sometimes longer as long as the tenant pays the rent and complies with other lease provisions. The landlord cannot raise the rent or change other terms of the tenancy during the lease, unless the tenant agrees.

Unlike a rental agreement, when a lease expires it does not usually automatically renew itself. A tenant who stays on with the landlord's consent after a lease ends becomes a month-to-month tenant, subject to the rental terms that were in the lease.

How do rent control laws work?

Communities in only five states California, the District of Columbia, Maryland, New Jersey, and New York have laws that limit the amount of rent landlords may charge.

Rent control ordinances (also called rent stabilization or maximum rent regulation) limit the circumstances and the times that rent may be increased. Many rent control laws also require landlords to have a legal or just cause (that is, a good reason) to terminate a tenancy for example, if the tenant doesn't pay rent or if the landlord wants to move a family member into the rental unit.

Landlords and tenants in New York City, Newark, San Francisco, and other cities with rent control should be sure to get a current copy of the rent control ordinance and any regulations interpreting it. Check the phone book for the address and phone number of the local rent control board or contact the mayor or city manager's office.

How much security deposit can a landlord charge? What can it be used for?

All states allow landlords to collect a security deposit when the tenant moves in. Half the states limit the amount landlords can charge, usually not more than a month or two worth of rent the exact amount depends on the state. (For the maximum amount in your state, see Chart: Security Deposit Limits, State by State.) Many states require landlords to put deposits in a separate account, and some require landlords to pay tenants the interest on deposits.

Landlords use the deposit to cover unpaid rent and perform needed repairs or cleaning that results from more than normal use. But your security deposit should not go towards remedying ordinary wear and tear during your occupancy. For instance, a landlord cannot withhold your deposit to pay for house cleaning, carpet cleaning, or repainting unless these chores were necessary because of your unreasonable use of the rental. You can protect your security deposit by recording the condition of the premises when you move in, by using a move-in checklist and/or taking pictures. For more information, see the article Protect Your Security Deposit When You Move In.

Where can I find a dependable lease or rental agreement?

Using a jargon-laden form bought at a local office supply store can spell trouble. These forms are often overly legalistic, may contain illegal clauses, and are probably out of date and not in sync with your state's laws.

Nolo Resources

Nolo's forms are easy to understand, fair, and always up to date. For a Fixed-Term Residential Lease or a Month-to-Month Residential Rental Agreement, see Every Landlord's Legal Guide, by Marcia Stewart, Ralph Warner, and Janet Portman (Nolo).