A lease agreement is a contract between a property owner (the lessor) and a tenant (the lessee) that gives the tenant the right to use the property for a period of time in exchange for rent. It sets out the rules both sides must follow and is enforceable in court.
A clear, complete lease is one of the best tools a landlord has for preventing disputes, because it puts expectations in writing before problems arise.
Key terms a lease should include
- Parties and property. Names of all adult tenants, the landlord or manager, and the rental address and unit.
- Term. Start and end dates for a fixed-term lease, or month-to-month terms with notice requirements.
- Rent. Amount, due date, accepted payment methods, grace period and late fees as allowed by law.
- Security deposit. Amount, how it may be used and how it will be returned. See security deposit.
- Occupancy and use. Who may live in the unit, guest limits and any restrictions on business use.
- Maintenance and repairs. Who handles what, and how to submit maintenance requests.
- Pets, smoking and parking. House rules and any related fees or deposits.
- Entry. How much notice the landlord gives before entering, consistent with state law.
- Subletting and assignment. Whether a sublease is allowed and on what terms.
- Required disclosures. Such as lead-based paint for most housing built before 1978, plus any state or local disclosures.
Fixed-term vs month-to-month
A fixed-term lease, often 12 months, locks in rent and terms for both sides until it ends. A month-to-month agreement renews automatically each month and can usually be ended or changed with proper notice. Fixed terms provide stability, while month-to-month arrangements provide flexibility.
Why it matters for landlords
Your lease is only as good as its compliance with local law. Clauses that waive tenant rights or conflict with state rules may be unenforceable. Start from a state-specific template, like our California residential lease agreement, and have an attorney review it. Our lease agreement guide covers each clause in more depth. With TenantLoop leasing, you can send leases for eSignature and store signed copies with the tenant’s records.
Related terms
Where it gets confusing.
What is the difference between a lease and a rental agreement?
People often use the terms interchangeably. Strictly speaking, a lease usually covers a fixed term, such as 12 months, while a rental agreement often runs month to month until either side gives notice.
Does a lease have to be in writing?
Many states require leases longer than one year to be in writing to be enforceable. Even for shorter terms, a written lease is strongly recommended because it documents what both sides agreed to.