Ques. What steps can a landlord take if a tenant refuses to leave even after his / her lease has been terminated?

Ans. Try reasoning with the tenant, if that fails a landlord can go in for third party mediation, failing which he / she can take the tenant to court. It is important to remember, a landlord cannot evict a tenant on his / her own, it only lies within a court’s jurisdiction to do so.

Ques. How can a lease be terminated after its expiry?

Ans. It all depends on the kind of lease you have. An oral month-to-month tenancy lease can be ended, simply by serving a written notice on the tenant and giving a 30-day notice period to vacate, if rent is paid on a monthly basis. In the event, of weekly rental payments, a landlord must give 7-days notice to vacate. Most states require notices to be delivered in person, although they can be sent by mail, as well.

In case of written leases specifying a set duration or term, a lease automatically expires on the last day of the term. However, some cities require a 30-day written notice to the tenant before the end of a lease term, as without notice, a tenant remains unaware, whether the landlord wishes to renew the lease or terminate it. It is a good idea for landlords to discuss lease expiries with tenants, well before a lease term is up.

A tenant’s lease can also be terminated for a good cause, such as, non-payment of rent, damaging the premises, or violating the rules and regulations mentioned in the lease. Common violations are disturbing the peace of the neighbourhood by creating excessive noise, keeping pets despite a No Pets clause in the lease, keeping co-tenants not listed in the lease. Again, a notice must be issued to the tenant that he / she has so many days in which to correct the problem, failing which, eviction proceedings will take place.

Ques. Why all the emphasis on written notices?

Ans. The law imposes specific statutory obligations on landlords as to the method to be followed for terminating leases, and if a landlord does not comply with a written notice when required or if it is not properly worded or served to the tenant, the landlord forgoes the right to terminate the tenancy. Before proceeding to litigate, a landlord must insure all deficiencies have been corrected in the written notice, as else it may be too late, once the matter has gone to court.

Ques. What is the time duration of the eviction process?

Ans. After expiry of a notice period, a landlord is allowed to go ahead and file an unlawful detainer lawsuit, which is assigned for trial as a summary or quick proceeding by the court. Assuming the notice to vacate and summons to court have been properly serviced, the court renders judgement after a default proceeding or trial, which may be scheduled two weeks after filing of the suit. Certain states allow a judge to order immediate eviction at the end of the trial.

Usually, the court gives the tenant one to four weeks to move out. If a tenant refuses to leave even then, a landlord can hire the sheriff or marshal to carry out a forcible eviction, all of which could take several weeks. Further, a tenant filing a motion for extra time or objecting to the ruling of the court, could lead to further delays.

On the whole, the eviction process can take anywhere from five weeks to three months, assuming there are no delays.

Ques. Supposing a tenant does not show up in court, what happens then?

Ans. In the event a tenant does not respond properly or show up in court, the judge issues a default judgement in favour of the landlord. It is not in a tenant’s interest to fail to appear in court.

Ques. What kind of judgment does a court give for eviction cases?

Ans. A court ruling in favour of the landlord means, it may ask the tenant to simply vacate the premises, or else to pay back rent and vacate, as well as, pay for damages to the premises, court fees, and pay the landlord’s legal costs.

Ques. What if a landlord physically throws out a tenant and his / her possessions after a court orders eviction?

Ans. If, he / she does so, they may end up in trouble. Only a sheriff or some other proper authority can carry out physical eviction, just as only the court can evict a tenant. The main purpose behind court proceedings is to prevent landlords from carrying out illegal self-help evictions. Again, if the court issues a judgement for unpaid rent, the landlord is required to use the normal debt-collection procedures.

Ques. Is a tenant required to pay rent after a lease is terminated or the court orders his / her eviction?

Ans. If, after a landlord and the court have terminated the tenancy, in many states a tenant can still be held liable for payment of rent, if it has been provided for in the lease. However, it is unusual for a landlord to sue a tenant a second time, if the first lawsuit was non-payment of rent.

However, landlords can avoid litigation issues by screening prospective tenants and employees, or by conducting background checks on them. Visit www.e-renter.com for tenant screening and background check services.

As a rule, every landlord will take a security deposit to ensure payment of rent, as well as, to see to it tenant responsibilities are carried out as laid down in the lease i.e. any damage caused to the property by the tenant will be paid for by deducting the repair cost from the security deposit amount. While, every state has different laws governing security deposits, the following is simply a general overview.

1. Last Month’s Rental Payment Or Security DepositPlease understand last month’s rent and security deposit are not one and the same thing. Paying rent at the first of the month constitutes pre-payment to the landlord for the month’s tenancy. The security deposit amount is usually one month’s rent, as certain states stipulate no more than one month’s equivalent can be kept as security deposit to cover for tenant caused damage to the property. If a landlord raises the rent later on, he / she can ask the tenant to increase the security deposit as well, in keeping with the increased rent. However, neither a landlord nor a tenant can use the security deposit in lieu of unpaid rent, unless he / she has the other’s consent.
2. Security Deposits – Receipts and Interest AccrualsOn receipt of the security deposit amount or the month’s rental payment, a landlord is legally bound to issue a receipt confirming the payment. If, he or she does not, a tenant can insist on its issuance. Many states have made it compulsory for a landlord to issue receipts to tenants containing the following information:
   1. Amount paid,
   2. Payment date,
   3. Reason for payment,
   4. Receiver’s name,
   5. If an agent is collecting the rent, the name of the landlord for whom it is being collected should be on the receipt, as well, and
   6. Landlord or agent’s signature.

   When a landlord has taken charge of the security deposit amount, he / she must inform the tenant, in which bank and in which account, including the percentage of interest being paid on it. On his / her part, a tenant terminating a tenancy should provide the landlord with a forwarding address, where the security deposit amount plus interest can be sent.

   Since, security deposits are taken as a precaution against any damage a tenant may cause to the rental property, it is in a tenant’s interest to take stock of the condition of the rental premises, along with the landlord. Certain states have made a signed statement of the condition of the premises a necessary prerequisite. The statement should contain a comprehensive list of existing damages.

3. Security Deposit – Returns and DeductionsA security deposit must be returned within a fixed time (typically, 30-days) after termination of a tenancy. However, the landlord is entitled to deduct any unpaid rent, and any reasonable amount necessary to repair any tenant-caused damage to the property. As well, damage caused by pets can also be deducted, though a tenant does not have to pay for reasonable wear and tear associated with normal use. However, it is a tenant’s responsibility to maintain and keep the rental premises clean and litter free.

   In case of damaged premises, the law states a landlord must within 30-days after a tenancy ends, typically provide the tenant with the following documents:

   1. A detailed list itemising the nature and extent of damage caused, and necessary repairs required to make the property rentable again, and
   2. He / she must also provide written evidence, such as, estimates, bills, invoices, or receipts, indicating the actual or estimated cost of these repairs.

   The balance of the security deposit (if any) must be returned after all proper deductions have been carried out. If a landlord fails to return the security deposit (or balance after lawful deductions) with accrued interest, within the prescribed time period after a tenancy has been terminated, or fails to furnish the tenant with an itemised list of damages, if deductions have been made for damages, the state law permits the tenant to sue the landlord. If this happens, it can turn out be fairly expensive for the landlord, as many state statutes provide for damages triple the security deposit amount that has been withheld.

   Typically, state courts make some provision for easy resolution of security deposit disputes, such as, in small claims, conciliation, or landlord / tenant courts.

However, to avoid expensive litigation, landlords should screen prospective tenants thoroughly, weeding out undesirable elements with past evictions or criminal pasts. Visit www.e-renter.com for tenant screening and background check services.

Ques. What is ‘Repair and Deduct’?
Ans: In keeping with the law, repair and deduct permits a tenant to carry out essential maintenance tasks in his / her rental accommodation, deducting the repair costs from the rent, later on. As a rule, most state or local laws only allow repairs that make a place habitable i.e. getting a broken furnace to work again or plugging a leaking roof.

Ques. What restrictions, if any, surround the use of ‘Repair and Deduct’?
Ans. Local laws place a limit to the dollar amount a tenant is allowed to spend on repairs. Take for example, the Chicago ordinance that restricts a tenant from spending more than $500/- on rental accommodation repairs, while other existing laws limit a tenant from spending more than a month’s rent.

On the other hand, jurisdictions that do not have an explicit repair and deduct legislation, rely on the implied warranty of habitability, limiting ‘repair and deduct’ to only the reasonableness of the repairs, so much so, a tenant may even buy a new furnace, and then deduct its cost from the rent.

Ques. Does a tenant have to follow a special procedure before going in for ‘Repair and Deduct’?
Ans. A tenant must serve his / her landlord with a written notice, specifically listing what repairs need to be carried out. He / she must warn the landlord that failure to comply within the stipulated time-frame will see the tenant carrying out the necessary repairs, deducting repair costs from the rent, later on.

Ques. What is meant by reduced rent?
Ans. If rental premises fail to comply with the local housing code standards, the law allows tenants to pay reduced rent, instead of the full contract amount, a reflection on the reduced value of the premises.

Ques. What calculations do courts use to calculate rent reductions?
Ans. Several standards are used, with no consistency across the country. Reductions may be permitted based on the fair market rental value of the premises i.e. the rental amount may be reduced from the contract amount to the value a court considers fair considering the defects. Or, a proportional use standard is used, meaning rent reduction is determined on the basis of how much the defects reduce use of the premises i.e. 40% use reduction involves a 40% reduction in rent.

Ques. What procedure is to be followed by a tenant for paying reduced rent?
Ans. A written notice must be served to the landlord, listing what repairs are required to be done, as well as, stating the timeframe within which they must be carried out, failing which the tenant will pay reduced rent, unless and until the landlord carries out the repairs within the specified time.

Ques. Is a tenant allowed to seek past months rent reduction for defective premises, even though he / she has paid rent in full?
Ans. Possibly, only in this case, the tenant may have to sue the landlord to collect. Both, implied warranty of habitability and local ordinances grant a tenant the right to recover damages from a landlord for failing to maintain the rental premises according to local housing code standards. Take for example, the case of a tenant whose lease calls for $500 per month as rental charges, which he / she has paid for 7-months = $3,500 in sum total. If, the courts declares the rent charged should not have exceeded $350/-, then it can ask the landlord to refund overpayment of $1,050 to the tenant.

Ques. Is a tenant allowed to withhold all of the rent?
Ans. A tenant can do that to catch the landlord’s attention. However, it is also possible that the landlord will retaliate with a notice to pay or get out. If, the premises are habitable to some extent, a certain amount of rent is due the landlord, and only a court can decide the reduction that is justified.

Ques. Does a tenant have to hold the withheld rent in an escrow account?
Ans. It is not a legal requirement, though perhaps, it might be a good idea, as some local landlord-tenant ordinances might require the rent money to be placed in escrow, in the event the case goes to court, when the judge may ask if the disputed money is available.

However, to avoid expensive litigation, landlords should screen prospective tenants thoroughly, weeding out undesirable elements with past evictions or criminal pasts. Visit www.e-renter.com for tenant screening and background check services.

Ques. How does it benefit to have a written lease agreement, and are there any advantages to having one?
Ans. A professional landlord will never make the mistake of renting out his / her property without a formal written agreement. The chief advantage of putting down rental terms in writing, serves to defend a landlord’s right to hold the tenant responsible for paying rent for the entire duration or term of the lease, even though the tenant may have moved out, much before its expiry.

As well, it works to the advantage of the tenant, in that the landlord cannot raise the rent beyond the amount specified in the lease during its term. Furthermore, most standard lease forms are written up by lawyers working for landlords, or for the real estate industry, and more often than not, seem to be heavily slanted in favour of the landlords.

Ques. What are the advantages of an oral versus a written lease?
Ans. An oral agreement or month-to-month agreement works to the advantage of a tenant, in that he / she may terminate the lease, moving out without any further rental liability, simply giving a short notice to the landlord. As a rule, the notice should be the same as the term of the agreement i.e. commonly 30-days. Reports indicate tenants are extremely mobile, with 20% moving each year, therefore, if ease of moving out is an important consideration, an oral or month-to-month agreement works in favour of the tenant.

On the other hand, an oral lease provides landlords an easy way out to quickly terminate a lease giving only a short 30-day notice, if he / she finds the tenant to be an undesirable element, or else, if a landlord wishes to raise the rent, an oral agreement plays in his / her favour allowing him / her to increase the rent after giving due notice, usually 30-days. As well, it is best to remember that in the case of oral agreements; usually there is no requirement for a landlord to provide a valid reason for terminating the agreement, a necessary requisite in most other cases.

Ques. What are the disadvantages, if any, to having a lease in writing?
Ans. A written lease is more pro-landlord than tenant, it disadvantages a tenant, as a landlord may write in express provisions that void certain protections the law ordinarily makes provisions for tenants. And, written agreements may not always clearly define a landlord’s responsibilities.

Ques. Are there any disadvantages to having only an oral lease?
Ans. Because, there is nothing in writing, the major disadvantage of having only an oral agreement is the possibility of misunderstandings arising between landlord and tenant regarding the conditions of the tenancy.

It is important from both landlord and tenant perspectives to have a clearly defined written rental agreement, if they both wish to go in for a long-term relationship. And, an honest landlord will ensure both tenant and landlord responsibilities get due importance in the lease terms. For short-term renting, oral agreements are better for both landlord and tenant.

However, to avoid expensive litigation, whether you go in for a written or oral agreement, it is important for landlords to screen prospective tenants and employees, weeding out undesirable elements with past evictions or criminal pasts. Visit www.e-renter.com for tenant screening and background check services.

Every landlord must ensure that his / her lease or rental agreement contains a clause stating if a tenant plans on getting a roommate, he / she has to get prior approval, before allowing anyone to move in.

Whether, a tenant would like a current flame to move in with them, or is simply replacing a roommate who has moved on, they must check it with you. Even though, you may not mind another person on the premises, it is always reasonable to play it safe by insisting the new roommate becomes a co-tenant, and takes on the same rights and responsibilities as your existing tenant, they are thinking of sharing your rental premises with.

Obviously, a landlord needs to know, whether the new roommate is financially stable and is a law-abiding citizen. You must be satisfied with the intended co-tenant’s stellar qualifications, before acceding to the request for a roommate. Consider the following before giving the go-ahead:

1. Will adding a roommate exceed the state occupancy limit? Landlords are entitled to set reasonable limits on the number of occupants per rental unit. As a general rule, two persons per bedroom is permissible, though some localities, such as, New York City allow more.
2. Will the new roommate meet a landlord’s good-tenant criteria? Like any other prospective tenants, you must subject the proposed new tenant to undergo a thorough screening process, checking credit, employment, rental history, and references, even though your existing tenant has already provided them with a glowing reference.

Unless, you are on fairly close personal terms with your tenant, request a written note if an existing tenant wishes to add a roommate. This gives you an un-pressured opportunity to think about it. If, your rental property is big enough for another tenant, and you are not averse to adding another tenant, this might be a good opportunity to raise the rent considering with an extra body on the premises, there will be more wear ‘n tear of property, as well as, an increase in utility use.

Once everything has been discussed and settled, don’t forget to add an amendment to the existing lease or rental agreement, adding details of the new tenant and getting their signature on the lease, as well.

However, to avoid expensive litigation, whether you go in for a written or oral agreement, screen prospective tenants and employees thoroughly, weeding out undesirable elements with past evictions or criminal pasts. Visit www.e-renter.com for tenant screening and background check services.

Ques. How much security deposit is a landlord allowed to charge a tenant?
Ans. It is permissible in all states to allow landlords to collect security deposit from a tenant at the time he / she moves in. A security deposit is a necessary requirement as landlords use it to cover unpaid rent, or for repairing or cleaning up a tenant’s messy house-keeping, after he / she has moved out. States limit the security amount landlords can charge, which is usually not more than a month or two worth of rent.

State laws state it is a requisite for landlords to put the deposit in a separate account, which is to be paid back to tenants plus interest.

Ques. How can a tenant protect his / her security deposit?
Ans. A tenant does not always get back the full security deposit amount plus interest, as more than a few landlords withhold all or part of a tenant’s security deposit on a tenant’s departure as a matter of course, to pay for house cleaning, carpet cleaning, and perhaps repainting. However, unless absolutely necessary due to a tenant’s mis-adventurous use of the rental, it is not legal for a landlord to make such deductions. He / she cannot use security deposits for ordinary wear and tear that occurs during a tenant’s occupancy.

Ques. Is there a grace period for late rent before landlords can begin charging late fees, and are they legal?
Ans. Unless, a lease or rental agreement specifies otherwise, most states do not have a legally recognised grace period for late rent. It means, if a tenant has not paid rent on time, a landlord can usually terminate the tenancy with a ‘pay or quit’ notice a day after its due date. However, some leases and rental agreements do provide a five-day grace period for late rent.

As well, there are some landlords, who charge fees for late payment of rent, or for bounced checks, and if reasonable, these fees are usually legal. Laws relating to late fees can be found in a state’s landlord / tenant statutes.

Ques. Is it a legal requirement to pay rent on the first of the month?
Ans. Custom demands rent to be paid monthly, in advance, often, on the first day of the month. However, it is perfectly legal for a landlord to ask for rent to be paid at different intervals or on a different day of the month.

Ques. When can a landlord increase the monthly rent?
Ans. A landlord can raise the rent, of course, subject to rent control laws with a proper written notice, usually 30-days, if a tenant has a month-to-month rental arrangement.

In the case of a fixed-term lease, the rent cannot be raised during the lease term, unless the increase is specifically called for in the lease, or unless the tenant agrees. When a lease expires, the landlord may raise the rent, again subject to rent control laws, if any.

Ques. How do rent control laws work?
Ans. Only five states i.e. California, Columbia, Maryland, New Jersey, and New York -have rent control laws, limiting the amount of rent landlords may charge.

Rent control ordinances (also called rent stabilisation or maximum rent regulation) limit rental increases. These rent control laws also require landlords to have a legally valid reason for wishing to terminate a tenancy, e.g. if the tenant does not pay rent, or if the landlord wants the rental property for personal use.

However, to avoid expensive litigation, landlords should as a rule screen prospective tenants and employees thoroughly, weeding out undesirable elements with past evictions or criminal pasts. Visit www.e-renter.com for tenant screening and background check services.

Whether, you are a first time landlord or have been in the rental property business for, as long as you can remember, always, but always, check a tenant’s credit history, taking care to avoid legal trouble over discrimination. You may ask:

Ques. How can landlords best screen tenants? Is there a foolproof way to do so?

Ans. Yes, there is a foolproof way of screening tenants that requires a sharp business savvy landlord to have all prospective tenants fill out written rental application forms. The application form, apart from requesting other necessary information, also asks for the following:

1. Employment, income, and credit history.
2. Social Security and Driver’s License numbers.
3. Past evictions or Bankruptcies, if any, and
4. References.

What must be remembered is tenant selection should not be made before the screening process has been satisfactorily completed. A landlord needs to check previous landlord(s) and other references, as well as, verifying income, employment and bank account information. And, last but not least, do obtain a credit report for a prospective tenant. Especially the last, as a credit report is important from the point of view, it indicates, whether an individual has a history of paying bills late, or whether he / she has declared bankruptcy at any time, or else has been convicted of a crime, or even been evicted.

Ques. Do landlords or property managers have the right to obtain a prospective tenant’s credit report?
Ans. Yes, a prospective tenant’s credit report can be obtained, as long as, you have received written permission to do so. If, an applicant is turned down, due to negative information on a credit report, the applicant has to be informed of the following three things:

1. The reason for rejecting him / her.
2. As well, you are required by law to give them the name and address of the agency that has given the adverse report, as well
3. A landlord must inform the applicant that he /s she has the right to obtain a free copy of the report within 60-days from the agency that provided you with it.

Common knowledge, everyone knows, before a credit check can be run, prospective tenant’s name, address, and Social Security number is required. A credit report can be ordered from a credit reporting agency, and an agency like www.e-renter.com can help you obtain it from one of the three major national credit bureaus i.e. Equifax or TransUnion.

Ques. Is it a requirement for landlords to use written rental applications?
Ans. While, not really a necessary practice, requesting prospective tenants to fill out written applications is one of the best ways to protect yourself from lawsuits filed by rejected applicants.

For example, after interviewing six tenant applicants, you select the third to rent your rental property to, as you feel he / she is the most likely to be reliable about paying the rent on time. A couple of weeks down the road, you may get a call from a lawyer hired by one of the applicant’s, who claims she was racially discriminated against for being an African-American and a single mother, on top of that. You may settle the matter by paying $10,000/-, but if you don’t, you could end up being promptly sued in federal court for $50,000/- plus.

Having no written documentation that explains the reasons why you selected the single white male with no children as your tenant, over an African-American single mother, with a higher-paying job, may have your insurance company taking the easy way out and paying the rejected applicant $10,000/-. After all, as the insurance company points out, your selection over the other, does look like racial discrimination.

If, you had been able to produce all written applications of all the applicants, including credit reports, references from previous landlords, etc. the end result would most likely have been different. You would have written documentation to support your choice of tenant, his credit history, job stability, far better than the rejected applicant’s, who (despite her current high-paying job) had only recently declared bankruptcy, as well as, a previous landlord reference check did not incline you in her favour.

Ques. What are the illegal types of discrimination, when choosing a tenant?
Ans. A careful study of the Fair housing laws, which specify the reasons considered illegal, when refusing to rent to a tenant, such as, rejection of an applicant on the basis of race, religion, ethnic background, sex, or the applicant has children or suffers from a disability, is a decided necessity. In addition, some state and local laws prohibit discrimination based on an individual’s marital status, sexual orientation, or age.

While, it is legal to freely choose from amongst prospective tenants, a landlord’s decisions must comply with state or federal laws, and must be based on legitimate business criteria. For example, the law entitles a landlord to reject a prospective tenant, with a poor credit history, insufficient income to pay the rent, or past behaviour, such as, damaging property that makes him / her a bad risk factor.

It is also legal to reject on the basis of a valid occupancy policy that limits the number of people per rental unit for health and safety reasons. Landlords are required by law to apply selection standards, such as, minimum income and a good credit report requirements, equally to all tenants.

Ques. What kind of subtle discrimination is considered illegal?
Ans. Fair Housing Acts prohibit landlords from taking any of the following actions based on race, religion, or any other protected category:

• False denial of a rental unit made available to some applicants.
• Advertisements that subtly indicate a preference based on group characteristics i.e. colour of the skin.
• Setting more restrictive standards, such as, higher income, for certain tenants.
• Being unreasonable in refusing to accommodate necessary needs of disabled tenants i.e. guide dogs, hearing dogs, or other service animals a disabled person requires.
• Playing favourites among tenants i.e. setting different terms for some tenants, by adopting an inconsistent policy towards late rental payments, or
• Terminating a tenancy for discriminatory reasons.

To avoid expensive litigation, screen prospective tenants and employees, weeding out undesirable elements with past evictions or criminal pasts. Visit www.e-renter.com to avail their tenant screening and background check services.

As the owner of rental property, you might well ask whether you really need to go to the bother of drawing up a written lease or rental agreement, or whether a verbal arrangement with a tenant will suffice. Resoundingly yes, it is important to have a written lease or rental agreement, especially if you are to protect yourself against any litigation that may arise from tenancy problems.

As well, lease or rental agreements hold the key to successful tenancies, setting out important issues relating to tenancy duration, rental and deposit amounts, the number of people permitted to live on the rental property, whose responsibility it is to pay the utility charges, whether or not pets are allowed, if sub-letting is permissible, landlord access to the rental property, as well as, who will pay the legal fees in the event of a lawsuit. As for verbal agreements, even though certain states will enforce them, they will only do so for a limited time period i.e. not longer than a year.

Now, the question remains, whether to go in for a lease or a rental agreement. Before deciding on either, you need to know the difference between the two.

Difference Between A Lease And A Rental Agreement

For one, a rental agreement is short-term providing for a limited period tenancy (usually 30-days), which is automatically renewed at the end of the period, unless the tenant or landlord terminates it through a written notice. As well, the terms of the agreement can be changed by written notice, such as, an increase in rental charges, or making the tenant responsible for paying utility charges, for these month-to-month rentals.

A written lease agreement, on the other hand, gives a tenant occupancy rights for a set term, anywhere from six months to a year, and even longer, if a tenant continues to pay rent on time and complies with other lease provisions. However, during the term of a lease, the landlord cannot increase the rent or change other tenancy terms, unless the tenant gives his / her sanction. Unlike a rental agreement, when a lease expires it does not automatically renew itself. A tenant who stays on, with of course, permission from the landlord, after his / her lease has expired, becomes a month-to-month tenant, while still subject to rental terms contained in the lease.

Which One Should A Landlord Go For?

Most landlords prefer month-to-month agreements, particularly when occupancy rates are high and tenants can be found easily due to tight rental markets, and upwards trending rental charges. On the flip side month-to-month tenancies guarantee higher tenant turnover, and more hard work to ensure there are no or limited vacancies.

However, areas with high vacancy rates, or where tenancy rates go down during certain seasons e.g. college or university towns that are deserted during summer months, with students and staff on vacation, landlords prefer to go in for lease, rather than rental agreements. A landlord must decide for himself / herself what best suits the location of his / her rental property.

To avoid expensive litigation, screen prospective tenants and employees, weeding out undesirable elements with past evictions or criminal pasts. Visit www.e-renter.com to avail their tenant screening and background check services.

Any landlord, whose main source of income comes from renting out his / her property should take care to draw up a fair, legally valid agreement, else there could be major legal repercussions if, either landlord or tenant break a lease or an agreement.

Ques. What is the importance of signing a lease or rental agreement?
Ans. Essentially important, a landlord must draw up a legally binding lease or rental agreement, which holds the key to a successful tenancy. It is a document that sets out important issues, such as:

1. Duration of the tenancy.
2. Rental and deposit amounts required to be paid by a tenant.
3. The number of people permitted to live on the rental property.
4. Whether, the landlord or tenant is responsible for paying for utilities.
5. Whether, pets can be kept on the rental premises.
6. Whether, the tenant is allowed to sublet the property.
7. Landlord’s access to the rental property, and last but, not least,
8. Who is responsible for paying for legal costs, in the event of a lawsuit?

Always, but always, leases and rental agreements should be put in writing, even though most states do accept oral agreements. Easy and informal, though they may seem oral agreements often lead to heated disputes. If, later on both landlord and tenant disagree about key elements of the agreement, such as, a tenant sub-letting, it could all, far too likely lead to a court argument, over what was said by either party, when it was said and in what context it was said. Usually, this is a particular problem, with long-term leases; therefore, courts in most states do not enforce oral agreements after a year has elapsed.

Ques. Is there a difference between rental agreements and leases? If, so what are the differences?Ans. The biggest difference between the two is the period of occupancy. A written rental agreement provides for a short-term tenancy, often 30-days, and which automatically gets renewed at the end of this period, unless the tenant or landlord end it by way of written notice, which again is typically 30 days. For month-to-month rentals, where rent is paid on a monthly basis, a landlord is allowed to change agreement terms, after proper notice has been duly giving in writing, and again subject to any rent control laws that may be prevalent in the state. Usually, the notice period is of 30-days, though certain states do permit a shorter period, in the case of weekly or bi-weekly rental payments, or if a landlord and tenant mutually consent to it.

On the other hand, a written lease offers a tenant longer term occupancy, anywhere from 6-months to a year, and sometimes even longer, so long as a tenant pays rent on time and continues to comply with other lease provisions. Unlike a rental agreement, when a lease expires, usually, it does not automatically renew itself. A tenant staying on with his / her landlord’s consent is, generally, considered a month-to-month tenant.

As well, a fixed-term lease means a landlord cannot increase the rent or change other tenancy terms during the duration of the lease, unless the changes are, specifically provided for in the lease, or the tenant concurs.

Ques. What are the consequences of a tenant breaking a long-term lease?
Ans. As a rule of thumb, a tenant cannot legally break a lease, unless the landlord significantly violates its terms. For example, if a landlord fails to make necessary repairs, or fails to comply with important health and safety laws. Certain states have put laws in place, allowing tenants to break a lease due to health problems, or job relocation that entails a permanent move.

A tenant found breaking a lease without adequate cause, is held responsible for the remainder of the rent due under the lease term. In most states, however, a landlord is legally duty-bound to try to find a new tenant, as soon as possible, regardless of why the tenant is leaving, rather than having him / her pay for the total rent due, as per lease terms.

Ques. Is it legally possible for a landlord to break a lease, thus ending a tenancy?
Ans. Legally, a landlord can break a lease if a tenant significantly violates the lease terms or breaks the law, e.g. pays rent late, keeps a pet in direct violation of a no-pets lease clause, substantially damages the property, or participates in illegal activities, such as, drug dealing on or close to his / her rental premises.

However, first of all, a landlord is required to send the tenant a notice regarding termination of the tenancy. State laws have set out very detailed requirements, as to how termination notices must be written and delivered or served. Depending on what the tenant has done to break the lease terms or the law, a termination notice must state the tenancy is over, warning the tenant he / she has to vacate the rental premises, if he / she wishes to avoid an eviction lawsuit. Or, if a landlord so wishes, he / she can issue a notice allowing the tenant a few days to clean up his / her act, such as, paying up the rent or finding a new home for the dog or cat. It is important to bear in mind that expensive litigation can be avoided, provide the tenant does as requested. If, a tenant refuses to comply with the termination notice, then the landlord is free to file an eviction lawsuit against the tenant.

To avoid expensive litigation, successful landlords will find screening prospective tenants and employees helps in weeding out undesirable elements with past evictions or criminal pasts. Visit www.e-renter.com for tenant screening and background check services.

During the term of a lease, many things can happen to the rental accommodation, ranging from plumbing issues, such as, minor water leakage to major fire damage.

The Standard REBNY commercial office lease addresses the duties and obligations associated with the above happenings, with events requiring relatively minor repairs being dealt with in Article 4, the ‘repair’ clause; while major casualties are addressed in Article 9, the ‘destruction’ clause.

For the most part, these clauses have been interpreted more to the benefit of landlords, although occasionally the latter have been left exposed to possible liability. For example, a tenant should be conscious of the fact that:

1. When ‘repairs’ have to be carried out, the tenant may have to endure considerable business interference, as well as, could specifically be denied any rent abatement; and
2. In cases of ‘casualty’, the tenant may find the landlord has chosen to terminate the his / her lease that may be of immense value to him / her.

Repairs:

Article 4 provides, in brief, that:

• A landlord shall and is responsible for maintaining the exterior of the rental premises;
• On the other hand, the tenant shall and is responsible for maintaining the leased premises; and
• If, the landlord carries out repairs to the rented premises, the tenant is not eligible for abatement in rental charges.

The no-rent-abatement clause of Article 4 specifically cross-references the destruction clause of Article 9, under which a tenant may be eligible for abatement in rent. In practice, it is difficult to define the boundary between Article 4 and Article 9. Thus, in one litigation case, the Court held that Article 4 did not apply, as severe water damage to the premises had made the premises uninhabitable, therefore, the tenant was entitled to rent abatement, even while, the landlord was required to repair the water leaks at his / her expense.

Casualty

In the event, rental premises are damaged and uninhabitable due to fire, flood or other accidental destruction, is the landlord entitled to terminate the lease? Is he / she obligated to rebuild the building? The answer to these questions depends on the severity of destruction.

Under the standard Article 9(a): If demised premises are partially damaged or rendered partially uninhabitable, a landlord is obligated to make all necessary repairs at his / her expense, and rent, until such repairs are substantially completed, shall be allocated from the day of the casualty, according to the usable premises.

A landlord’s contract to restore leased property, if it should become uninhabitable applies to damage from accidental causes, but not to the effect of ordinary wear and tear or due to the neglect or fault of the tenant.

According to Article 9(b), for demised premises completely damaged or rendered absolutely unusable, the tenant will have to pay rent up to the time of the casualty, and thereafter, cease until the date when the premises have been repaired and restored by landlord. However, the landlord retains the right to choose not to restore the premises, if the building has been seriously damaged; preferring instead to demolish or rebuild it, the lease thereby can be terminated. In order, to terminate the lease, written notice must be given to the tenant, provided it is provided within 90-days of the casualty, and specifies the end date of the lease.

Accordingly, from a tenant’s perspective, he / she stand to lose a valuable leasehold interest, if the landlord opts for termination of the lease. However, the law says if the landlord complies with the notice provision, then Article 9(d) is enforceable, despite being unfair to the tenant.

But, unless a landlord provides timely written notice terminating the lease, he is obligated carry out all necessary repairs and restorations to the premises, and on his / her part the tenant is compelled to cooperate with the landlord’s restorations by removing all salvageable and movable possessions from the premises. The tenant’s liability to pay rent recommences five days after receiving a written notice from the landlord stating the premises are ready for occupation.

To avoid any litigative issues that may arise from such situations, landlords must carefully select and screen prospective tenants. For help in suitable tenant selection, visit www.e-renter.com for tenant screening and background check services, the best and only way to prevent expensive litigation, penalty charges or property damage.