Landlord / Tenant Law Overview | Legal Form Articles

Whether leasing property for residential or commercial purposes, it is important to have an understanding of the legal issues involved. Below is a brief discussion of these issues, and of the forms and materials available on our website to aid you in the leasing process.

Leases

A lease is an arrangement by which a lessor agrees to grant a lessee the possession and use of a particular piece of property for a specified period of time. The Lease Agreement between lessor and lessee will contain the terms of this arrangement, including the amount of rent and/or security deposit to be paid by the lessee, a description of the property being leased, the duration of the lease period, and the rights of the lessee to assign the lease or to sublease the property.

Rent

The primary ongoing obligation of the lessee with respect to a Lease Agreement is the payment of rent. Rent is generally due monthly on the first of each month, although it is within the landlord/lessor’s rights to establish a different period and/or due date for rent payments.

Within certain communities, there are limits and specific restrictions placed upon the amount of rent that can be charged to tenants. If you are living in one of these rent-controlled communities, you should contact your local housing authority to determine how these rules affect you.

To purchase a form for a Receipt of Rental Payment, please visit our website at www.findlegalforms.com, or click the appropriate link above.

Security Deposits

A security deposit is an amount of money paid by the lessee to the lessor, generally at or before the time that the Lease Agreement is executed, guaranteeing performance of the lease. The landlord holds the security deposit for the duration of the lease to insure against the tenant defaulting under the Lease Agreement, or otherwise damaging the leased property. A normal amount of “wear and tear” does not constitute damage for which the tenant would be financially responsible.

Upon the expiration or termination of the lease, the landlord/lessor is required by law to return the security deposit to the tenant/lessee. (You may wish to formally request the return of the deposit, through the use of a Security Deposit Demand Letter.) If there has been damage done to the property (outside of normal wear and tear), or if the tenant has outstanding financial obligations to the landlord, the security deposit can generally be used by the landlord to offset those obligations. It is therefore a good idea, especially for residential tenants, to make a detailed survey of the condition of the apartment at the time of move-in, to avoid being charged for any damage that existed prior to your lease period.

Security deposits are strictly regulated at the state level. Most states have placed restrictions upon the amount of money that a landlord can demand for a security deposit, as well as how long after the expiration of the lease the landlord has before he must return the deposit.

To purchase any of the forms mentioned above, or to obtain other related forms, please click the appropriate link below:

Subleases and Assignments

In most situations, a Lease Agreement will set forth the terms under which the tenant may transfer the right to use the leased property. There are generally two methods by which this transfer may take place: sublease and assignment.

A sublease grants a third party the same rights to occupy and use the leased property that were enjoyed by the original lessee. However, the original lessee remains ultimately accountable to the landlord under the original terms of the lease. The original lessee is no longer entitled to use the premises, but is liable for failure to pay rental payments, damage to the premises, or other default conditions.

An assignment is a complete transfer of the Lease Agreement to a third party. Once an assignment is made, the original lessee is absolved of all responsibility under the lease, and the third party becomes directly accountable to the landlord under the terms of the Lease Agreement.

In many cases, Lease Agreements will require the original tenant to obtain a Landlord Consent to Sublease or a Landlord Consent to Assignment before any such transfer can be made. In the absence of any provision in the lease requiring landlord consent to a sublease or assignment, state law will govern. In most states, landlord consent to sublease is less likely to be mandatory by law then is landlord consent to assignment. The reason for this difference is that under a sublease, the original parties (landlord and original lessee) continue to be held accountable under the lease agreement. When an assignment is made, this is not the case.

To purchase any of the forms mentioned above, or to obtain related forms, please click the appropriate link below:

Lease Duration

One of the most important terms of any Lease Agreement is the duration or term of the lease. In many cases at the end of the lease term, the parties will either enter into a new Lease Agreement, or the tenant will vacate the property. However, there are a number of different scenarios that can either occur at the end of a stated lease term, or that can actually result in the termination of lease prior to its scheduled end.

Renewal/Extension- At the end of the stated Lease Term, the landlord and tenant may wish to extend their relationship without entering into a new Lease Agreement. This can be accomplished through the use of a Lease Extension Agreement. In some cases, the original Lease Agreement may provide for an automatic renewal of the lease unless one of the parties elects to terminate the lease.It is worth noting under the law of most states, if a tenant continues to occupy the leased premises after the expiration of the lease period, and if the landlord accepts a rental payment from such a holdover tenant, that tenant will be considered a month-to-month tenant, and will be held to the terms and conditions of the original Lease Agreement. Specifics of holdover tenant laws may differ from state to state.

Termination- In some situations, one of the parties to a lease may have the option to terminate the Lease Agreement prior to the end of the lease period. This right may arise from a default by one of the parties, or it may simply be a right given as part of the Lease Agreement itself.

If either a tenant or a landlord violates a term or condition of the Lease Agreement, the other party may be entitled to terminate the lease agreement. Generally, such “events of default” must be material to the agreement (and not smaller, negligible violations), and in many cases, these events are spelled out explicitly in the Lease Agreement.

The first step a landlord may take after a tenant default is to send the tenant a formal Notice of Default, spelling out the specifics of the default situation, and the recourse that the landlord intends to seek if the default is not remedied by the tenant.

In some cases, a Lease Agreement may grant one or both of the parties the right to terminate the agreement at will. Generally, termination rights require some sort of prior, formal notice to the other party of the intent to terminate.

Commercial Leases vs. Residential Leases

While the basic principles of the landlord-tenant relationship are the same in both the residential and commercial contexts, there are a few differences between the two. For example, parties to a commercial lease are treated under the law as being equal, sophisticated bargaining partners. Thus, there is generally less in the way of legal protections offered to commercial lessees than to residential lessees.

You can find lease forms specifically tailored to either the residential or commercial context by clicking the appropriate link below:

Housing Discrimination

There are a number of state and federal laws prohibiting discriminatory practices in renting and leasing property to tenants. One of the more important federal pieces of legislation covering housing discrimination is the Fair Housing Act.

The Fair Housing Act covers most housing. In some circumstances, the Act exempts owner-occupied buildings with no more than four units, single-family housing sold or rented without the use of a broker, and housing operated by organizations and private clubs that limit occupancy to members.

The Act states that no one may take any of the following actions based on race, color, national origin, religion, sex, familial status or handicap:

Refuse to rent or sell housing
Refuse to negotiate for housing
Make housing unavailable
Deny a dwelling
Set different terms, conditions or privileges for sale or rental of a dwelling
Provide different housing services or facilities
Falsely deny that housing is available for inspection, sale, or rental
For profit, persuade owners to sell or rent (blockbusting) or
Deny anyone access to or membership in a facility or service (such as a multiple listing service) related to the sale or rental of housing.

For more detailed information on Fair Housing Act restrictions and guidelines, please see the Fair Housing Act page on the Department of Housing and Urban Development’s website. You can also find information on state fair housing laws through the Housing Department’s website.

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