How Tenant Contracts Work

Tenant law in the US varies by state and depending on the situation, by city. That’s why you sometimes hear of states that are more “landlord-friendly” or more “tenant-friendly.” However, contracts between landlords and tenants have certain things in common between states.

The contract between a tenant and a landlord is called a “lease.” Under the law, a lease may exists even if the tenant and the landlord have no agreement on paper … but of course, anything agreed to on paper is easier to enforce and always gives more clarity with respect to the terms. A lease agreement includes two major categories of agreement …

Landlord Covenants

Landlord covenants are responsibilities the landlord owes to the tenant per the terms of the lease. These might include:

  • Maintaining a safe and habitable property.
  • Fulfilling maintenance requests in a timely manner.
  • Requiring the tenant’s permission and/or notice to enter the property premises under certain conditions.

Tenant Covenants

  • Adhering to reasonable and established property rules and regulations like quiet hours, exterior decoration, and pet policies.
  • Maintaining the unit interior in reasonable, sanitary condition.
  • Allowing the landlord access to the unit under certain conditions.

A Misunderstood Note About Covenants …

Many tenants and landlords don’t understand how these covenants work together. The covenants are not conditional on each other. While both tenants and landlords are required by civil law to adhere to their covenants, if one part breaks a covenant, the other party may not break their own covenants to try and enforce compliance. They can sue for performance under the terms of the lease contract, but if they break their own covenants, they are liable for those breakages.

Below are some examples:

  • If a tenant fails to pay rent, a landlord cannot shut off utilities or remove the property door to attempt to coerce the tenant to pay. The landlord has the right to sue for eviction, but (s)he must abide by his/her covenant to maintain a livable environment, or be vulnerable to a countersuit.
  • If a landlord fails to address maintenance requests in a timely manner, a tenant is not within his/her rights to withhold rent payment. The tenant may sue the landlord for performance, but the same court that upholds his/her right to a livable rental unit will also uphold the landlord’s suit for eviction. Failure to perform maintenance does not excuse the tenant.

Other Parts of the Tenant Contract

Lease agreements typically contain the following components in addition to the covenants:

  • Names of Tenants or Occupants: Only named tenants and occupants are allowed to live in the unit. The landlord may establish maximum occupancy and guest policies.
  • Rental Rate: Agreed-upon monthly rental rate, including due date, grace period, accepted payment methods, and late fees.
  • Description of Property: Usually the unit and/or premises and access rules for common areas.
  • Deposit Agreement: The security deposit the tenant must submit, and conditions under which it will be returned upon move-out.
  • Termination Agreement: Under what circumstances the lease may be ended, including nonpayment, lease violations, habitability concerns, payment of early termination fees, etc.
  • Term: Many written leases have a set term of tenancy (for example, six months, one year, etc.) after which time the lease must be renegotiated and/or renewed. Other tenant contracts allow “month-to-month” tenancy.
  • Notice Requirement: How many days in advance the tenant must give notice of intent to move out. Regardless of other provisions, the landlord usually has the right to demand rent through the notice period, even if the tenant intends to move out sooner, on account of insufficient notice.
  • Pet Agreement: Allowed breeds, number of pets, pet deposit, pet fee, extra rent, cleanliness and sanitation requirements.
  • Parking, Storage, Valet Trash, and Other Services: Description of tenant access, plus any extra charges.
  • Disclosures: Some properties may require disclosures about lead-based paint, asbestos, bedbugs, toxic mold, or other potential hazards.

Read another important aspect (also often under appreciated) of managing a property HERE.



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