Sometimes a landlord will just have a face-to-face interaction with a tenant, take their payment, and give them the keys to the unit. Simply coming to terms, even without a lease, does give you some protection: the law backs oral agreements. The trouble with not having the relationship in writing, though, is that you do not have evidence of your claims.
Beyond being able to back up your assertions about your agreement with a tenant, there are various other reasons you want to have a lease or rental agreement in place:
Having a lease helps you explain everything. Once you go over those clarifications with the tenant, you will have less chance of getting calls at odd hours asking for parking, trash removal, or other elements to be clarified. The lease gets you to address top issues that you might otherwise fail to address before entering into the relationship. In that way, it helps you improve your own satisfaction while bolstering tenant stability.
It is critical to get a security deposit, to be used to cover repairs or unpaid rent. You want all the parameters of the security deposit to be stated in the lease. That way you typically can avoid legal issues before they start, simply referencing the lease.
You have to make certain disclosures to your tenants, per Minnesota landlord-tenant law. For example, you need to disclose anyone who is authorized to act on your behalf. Typically such disclosures are made within the lease.
Establish longevity expectations
You want tenants to stay in the property as long as possible. It reduces your costs to have someone stay there for a year or more. You know that you have a rent check coming in every month. Your rental property maintains a stronger community reputation. There is less wear and tear.
You will not retain the value of your rental property if tenants are mistreating it. You can make it clear to tenants in the lease what upkeep they need to do at the property. Snow shoveling, garbage removal, and lawn care are key examples. You also want to conduct regular inspections to ensure that there are no unsafe conditions (such as broken windows), ongoing damage (such as leaking pipes), or infestation risks (such as stored garbage).
Disagreements can arise over late rent fees, repairs, or deductions from the security deposit. When you do not have a lease, disputes related to these or other issues can spiral into legal fights.
A lease: one step in managing your rental property
A lease provides a strong basis to help you build the tenant relationships you want, manage expectations, and avoid disputes. However, it is just the first step in managing a property – and you may need help. At Twin Cities Leasing, let us show you why we’re the highest rated residential property management company in Minnesota. Learn more.