Landlord Rental Agreements
When renting out your rental property , a homeowner should have a rental contract, or agreement, which spells out everyone’s obligations in order to ensure that both parties are clear as to what exactly the agreement is, and are protected, should the other not hold up his or her end of the bargain.
Writing A Rental Contract
1. Create a title for your contract. The title of a contract should be at the top of the document in bold type and should reflect the contents of the agreement.
2. Describe the parties to the contract and state the date the contract will be signed. When describing a party, include his or her name, and the title by which he or she will be referred to throughout the contract, such as Guest, Homeowner, or Tenant.
For example, “This Vacation Rental Agreement is being entered into by John Smith, “Guest”, and Jane Smith, “Homeowner”, this 10th day of April 2013.”
3. Describe the property being rented. One or two sentences stating the address of the property and what furnishings and/or appliances are included is sufficient.
For example, “The property is located at 1212 Lawrence Street, Lawrenceville, ON 55555, is furnished, and includes a refrigerator, oven, stove, and dishwasher.”
4. State the term of the lease. One sentence, which states the date upon which the Guest may enter the premises, and the date upon which he or she must vacate it is sufficient.
For example, “This lease begins on May 1, 2017 (“Check-in Date”) and ends on October 31, 2017 (Check-out Date).” 5. Provide the payment details. Include the amount of the deposit and monthly payments due, the date upon which it is due, the form(s) of payment accepted (cash, check, money order, or credit card), the beginning and ending dates of the payments, and the address where payments should be mailed and/or can be dropped off.
For example, “Guest shall pay to Homeowner a deposit in the amount of $700 due upon execution of this Agreement, and then $1200 on the 1st day of each month, beginning on June 1, 2013 and ending on September 1, 2013. Payment shall be in cash or personal check or money order made payable to Jane Smith, and mailed to Jane Smith, 1212 Lawrence Street, Lawrenceville, ON 55555.”
6. Describe your cancellation policy. Keep this simple and easy to understand.
For example, “Should Guest cancel his or her reservation, in writing, at least twenty-one (21) days prior to the Check-in Date, one hundred percent (100%) of the deposit will be refunded. All other cancellations will result in no refund of the deposit.”
7. Describe the terms of your deposit refund policy. A sentence or two stating when the deposit will be refunded, under what circumstances it will not be refunded, and to whom and in what form it will be returned is sufficient.
For example, “All deposits will be refunded by check payable to the first Guest listed on this agreement, within forty-five (45) days of Guest’s Check-out Date. If any amounts are subtracted from Guest’s deposit refund, a complete invoice will be provided to Guest along with any partial deposit refund.”
If you allow guests to purchase a non-refundable deposit waiver in lieu of paying a security deposit, this information should be included in this section.
8. Define the duties of each party. This section can be as long or as a short as needed to completely and accurately describe the duties of each party. Some things to consider including in this section of the agreement are: Condition in which the property should be left. While it seems obvious that a Guest should leave the property clean and undamaged, ideas about what clean and undamaged means may vary. Be specific about what you mean by clean. For example, “Guest shall leave the property swept and vacuumed, with washed appliances and bath fixtures, and trimmed lawn.”
Having your lawyer or paralegal look over your vacation rental contract is highly recommended.
Happy Investing,
Maria Rekrut
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