When it comes to drafting a lease agreement for your Birmingham rental property, it should be strong, legally compliant, and protective of your interests as well as your tenant’s. It’s easy to make mistakes when you’re putting together a lease, especially if you’re new to renting out a property.
Today, we’re sharing some of the common mistakes we see, and we’re hoping to help you avoid some of the dangers that can lurk in bad or weak lease agreements.
Leases that are General
Many landlords think it’s easy enough to grab a lease template off the internet and hope for the best. While it may be that easy, it’s not a great idea. You need a lease agreement that’s specific to Alabama and the state’s unique rental laws and requirements. A good lease agreement is detailed rather than vague, and it includes all the addenda, disclosures, and other legal terminology that makes it compliant and defendable in court.
Don’t use any basic lease that you find online. Talk to a landlord attorney or get a copy of a good lease from a Birmingham property management company.
Leases that Don’t Include Rent Collection Policies
One of the most important pieces of information that needs to be in your lease is how rent is to be paid, and when. A strong lease will include the amount of rent that is due every month, whether there is any sort of a grace period for tenants to pay without penalty, and how the rent is collected. You might want to accept electronic payments, checks, or money orders. Be specific about how tenants can and cannot pay. Make sure there’s also language about late fees and other penalties.
You don’t want tenants to be able to say they didn’t know when rent was do or where they were supposed to pay it. If all of this information is in the lease agreement, everyone is on the same page. It also gives you the documentation you need if it gets to the point that you need to evict a tenant. The judge will ask to see your lease agreement.
Leases that Don’t Address Landlord and Tenant Responsibilities
Who is responsible for paying the water bill and mowing the lawn? These things should be spelled out in your lease. All of the expectations of the landlord needs to be addressed. If you expect your tenants to take care of landscaping, pay the HOA fees, or clean the pool, you need to state those things specifically in the lease. It’s also a mistake not to include rules and regulations. If you don’t allow pets, state that. If you do allow pets, make sure your lease includes a pet policy. Mention whether smoking is allowed and where parking is permissible.
Leases that Don’t Renew or Go Month to Month
Another danger is not stipulating what happens at the end of the lease term. You may want to negotiate a lease renewal with your tenants or allow things to go month to month. You’ll want to indicate how much notice must be given before a tenant moves out.
These are just a few of the things that can go wrong if you don’t have a strong lease in place. We’d love to help you protect your Birmingham rental property. Contact us at Decas Group.