Drawing up an airtight lease from the very beginning is one of the most important things you and your Columbia, Maryland property management company can do.
Doing this prevents any confusion amongst the parties regarding what is to be expected throughout the lease term, and helps to protect both property owner and tenant.
If you are currently self-managing your rental property, you might want to consider beefing up your lease drafting skills.
In fact, unless you have a finely tuned lease template, now might be a good time to enlist the help of a professional property manager in Columbia to put one together.
Knowing what to include in your lease agreement can be challenging, especially at first. And, the truth is, basic lease agreement templates found on the internet do not always address your most pressing needs.
This can lead to a lot of confusion and heated discussions between you and your tenants throughout their lease term.
That’s why today we are going to examine what a lease addendum is, and some of the top ones all property owners should include in their lease agreements.
What is a Lease Addendum?
Typically speaking, a lease addendum is a lease provision that changes, clarifies, or nullifies a part of an original lease document. Once added, it becomes a legal part of the signed contract, and is enforceable.
That said, there seems to be some confusion between the terms lease addendum and lease amendment. We are here to clarify.
This is an additional lease clause or provision attached to the lease agreement template that adds or excludes certain terms.
At the time of signing, the lease addendums are included and agreed to by all parties.
A great example of a lease addendum is a provision outlining the right of entry by the property owner. Entry by a landlord throughout the lease term is not unusual, and needs addressing in the lease agreement.
Sometimes, a separate clause is drafted and added to the back of the general lease agreement so both the property owner and tenant understand what constitutes a legal entry of the premises.
On the other hand, if you and your tenants have already agreed to sign a lease agreement, and then want to add a provision or clause altering the original document, this would be considered a lease amendment.
A perfect example of this is a pet policy.
Keep in mind, this can be included during the initial drafting of the lease agreement as an addendum.
However, if the original lease made no mention of a pet policy, because your tenants did not have any pets, and halfway through the lease they decided to adopt a dog, an amendment to the lease agreement will be needed.
This will outline any rules you have regarding pets in your rental, and will be signed and attached to the already-finalized lease agreement.
Top Addendums to Include in Your Columbia Lease Agreement
Whether you decide to make your Columbia rental property smoke free or not is a personal decision. However, if you wish to prevent smoking in your property, make sure to include a no-smoking addendum to the lease.
Clarify whether this policy applies to guests, and what the consequences are (including loss of security deposit) for breaching the agreement.
2. Pest Control
Pest control is a huge point of contention between landlords and tenants. There is plenty of debate over who is responsible for pest control, who is in charge of resolving a pest infestation, and who decides what constitutes an inhabitable living condition.
That’s why including a detailed pest control addendum is crucial to avoiding a landlord-tenant dispute. Just make sure to investigate your local laws regarding pest control, and clearly outline each party’s responsibilities.
3. Renters Insurance
Another critical lease addendum all Columbia property owners should include in their lease agreements is the requirement of renters insurance. It’s inexpensive, easy to get, and covers your tenants in a variety of situations, so you don’t have to.
Renters insurance typically covers the loss of your tenant’s personal property in the case of an emergency. It also takes some, if not all, of the liability off you if someone is injured while on your property.
Paired with your homeowners insurance, this provision is great for protecting your investment.
Your tenants need to understand your stance on roommates.
It is important you outline details regarding short- and long-term guests as well. After all, you don’t want to end up with adult tenants in your property that have not been screened, or are not paying rent.
In addition, you may want to include a separate lease addendum addressing the issue of subletting your rental. This way, you don’t end up with brand new tenants you have never met in your property mid-term.
Maintenance is a hot issue for tenants that lease your rental from you.
They want to know that at any time, no matter how minor the issue is, you are going to be available for maintenance and repairs.
Outline exactly what you will be responsible for, who to contact in the case of minor and emergency matters, and what type of maintenance and repair service they can expect.
In addition, do not fail to mention financial responsibilities of both parties, as well as maintenance issues that will be the responsibility of the tenants to handle (such as landscaping, filter changes, etc.).
Some property owners may offer covering the costs of some utilities as an incentive bonus for their tenants.
Or, you may choose to make your tenants responsible for all of the utilities.
Regardless, ensure your tenants know exactly what utilities they are to have placed in their own name.
In addition, any utilities that must remain under your name as the homeowner, but that you would like the tenant to pay, should be explained in this addendum.
This way, there is never any confusion as to who will pay for what, and when.
7. Move-Out Instructions
As much as you would love to have your existing tenants renew their lease with you forever, this is not a reasonable expectation.
That said, having clearly defined move-out instructions is the key to a smooth end of lease transition. Here are some things to include:
- Forwarding address requirement
- Key turn-in process
- Cleaning procedures
- Charge estimates for incomplete tasks
- Charge estimates for broken or missing items
- Supply costs and labor charges
- Utility statuses
- Move-out inspection process
Make sure your tenant understands the entire move-out process so that you don’t end up with a tenant that has disappeared with all of your keys, and has left a filthy rental behind that you have to take care of.
8. Early Termination
Speaking of the end of a lease term, another lease addendum that is strongly suggested you include in your Columbia lease agreement is the early termination clause.
There might be an instance where your Columbia tenant needs to break the lease agreement early.
And, while this is not ideal, it is in your best interest to outline the terms regarding an early lease termination to preserve your losses as much as possible.
Other Important Lease Addendums
As you continue building your rental property business, and you gain experience, you will quickly build a solid list of lease addendums to add to every lease agreement that gets put into place.
Here are some other important ones to consider:
- Appliances (including maintenance)
- Lock changes
- Fees and violation consequences
- Use of rental for home business
- HOA terms
- Right of entry
- Extended absence procedures
- Pet fees
- Rent collection procedures
Many of these lease addendums may very well be a part of your basic lease agreement.
However, for those times when you need to add something specific onto an existing lease agreement before you and your tenants sign and begin the move-in process, it’s good to know what types of things can easily be turned into lease addendums.
If you own rental property and are in need of an experienced property management company in Columbia who knows exactly what should be included in a lease agreement, contact Bay Management Group now.
We have the expertise to draft airtight lease agreements, complete with every lease addendum you could possibly need. We guarantee that both you and your tenants will know exactly what is expected of each other, and that you and your investment property will be protected to the fullest extent of the law.