Tempting as it might be to simply sign on the dotted line, Jonas Bordo of Dwellsy says it’s in your best interest to read your lease’s fine print. Here, he shares 13 clauses you may find in your lease and what you need to know about them.
Los Altos, CA (September 2023) – Congratulations! After a long search, you’ve finally found an apartment you like at a price you can afford. Your application has been accepted, and now all that’s left before you get your new key is signing the lease. Easy-peasy, right?
Not so fast, says Jonas Bordo, CEO and cofounder of Dwellsy. Signing a lease may feel like a formality when you’re eager to move into your new place, but it’s crucial to make sure you have read and understood what’s in it before gracing it with your John (or Jane) Hancock.
“It’s not uncommon for renters to be blindsided by a clause they didn’t realize was in their lease,” says Bordo, coauthor, along with Hannah Hildebolt, of Everything You Need to Know About Renting But Didn’t Know to Ask: All the Insider Dirt to Help You Get the Best Deal and Avoid Disaster (Matt Holt, August 2023, ISBN: 978-1-6377439-2-8, $21.95). “Sometimes an unforeseen rule, regulation, or responsibility is a minor irritation for renters—but other times, it can materially impact their quality of life and lead to major rental regret.”
Leases are formal contracts that are legally enforceable once the landlord and renter have signed them. It’s in your best interest to read every word, no matter how long the document is. A lease can serve as the strongest defense if either party challenges the other.
“Many leases are only a few pages long, but I’ve encountered some real doozies, too—up to 85 pages!” comments Bordo. “Most are fairly straightforward and cover basic topics like how much you’ll pay, how long you’ll stay, and what you’ll be responsible for while you’re there—but others have so many rules, clauses, and conditions they make tax law seem straightforward.”
He adds, “It’s safe to say that a landlord who will take the time to write an 85-page contract will also take the time to enforce the consequences if you don’t fulfill your end of the bargain—so don’t be caught unawares.”
Bordo’s new book is meant to help people “win” at renting. It covers the entire process, from preparing for the rental search to getting your security deposit back after your lease is up. With several decades’ experience as a renter, landlord, property manager, and current CEO of the largest U.S. rental marketplace, Bordo is a trusted authority on all things rental-related—and the book will be an invaluable resource for all renters.
The Low-Down On Leases
Here, Bordo shares 13 things to make sure you understand before signing your lease.
How much will I need to pay?
The lease should clearly identify your rent amount, but look for other potential costs that may be included: security deposit, pet fees, parking fees, late fees, storage costs, etc. Your lease should also specify which (if any) utilities are included in the rent. If you don’t see them on the lease, assume you’re responsible for paying them.
“New renters especially tend to be surprised by many of these costs, which can add up to 20 percent or more of your rent,” says Bordo. “You don’t want to discover that your apartment is out of your budget after you’ve signed the lease.”
How do I pay rent and fees?
Landlords can be particular about how they want to get paid. Some are old school and want a check, or in some cases, cash. Some take advantage of modern conveniences and would like you to pay online through a portal that they’ve set up. Others may ask you to pay via Zelle or Venmo. This is good to know in advance so you can pay promptly.
“A word of warning about peer-to-peer payment methods like Zelle or Venmo,” says Bordo. “These platforms are often used by scammers, so never use them to pay your first month’s rent or other up-front fees. Once you have moved in and established that your landlord is legit, feel free to Venmo your rent.”
How long is my lease?
In the U.S., a standard lease is usually 12 months—but that’s not always the case. It’s quite common to find 13- or 14-month leases, and there’s an increasing trend to offer 16- or 18-month leases as well. It’s in a landlord’s best interest to keep rental units continuously occupied for as long as possible. No matter how long you plan to rent, your lease document should specify the dates when renting starts and ends.
Is there an acceleration clause?
An acceleration clause allows your landlord to end your lease early if they decide to sell the unit. If you see this clause in your lease, take it as a warning that you may be asked to move before your lease is up. This might not necessarily be a dealbreaker, but it’s certainly not something you want to be blindsided by.
How many people can live here?
There is often a legal limit or landlord-imposed cap on the number of people who can live in a rental. Be aware that this clause might cover all overnight guests, not just official roommates. So if you’re planning to host your extended family when they visit your city, check your lease first to make sure you won’t be exceeding occupancy caps.
Who pays for repairs and maintenance?
Some landlords take full responsibility for all the repair and maintenance, whether it’s a leaky faucet or a broken air conditioning system. Some will repair and maintain major appliances and leave the rest of the repairs on the renter. And some require the renter to handle everything. (If so, hope you’re good at DIY!) If you don’t read the lease, you won’t know what you’re getting yourself into—and it could cost you a lot.
Can I have a pet?
Your lease should mention if pets are allowed, and if so, any restrictions on the size and breed of pets. Any pet fees and/or damage-related fines should also be clearly stated.
What’s the landlord’s right of entry?
All landlords have the right to get into their rentals under certain circumstances. For instance, does the lease give your landlord unlimited access to deal with emergencies? (This is usually a good thing since an emergency can destroy your home.) Does your landlord have to give you 24 hours’ notice before entering when it is not at your request? Do they expect to complete a walk-through of the unit at pre-determined intervals?
“If you don’t see this clause in your lease, it’s worth asking your landlord about before signing,” says Bordo. “I have encountered individual landlords who enter their rental units—often—with little to no warning, much to renters’ chagrin.”
What are the community and/or house rules?
Leases often include rules that set standards and expectations. Usually, these are unsurprising—but not always. Community or house rules might enforce quiet hours, how and when communal areas may be used, what types of alterations you can make, how many parking spaces you can use, and even whether you can hang a towel over your balcony. Read this section in some detail to make sure you can live with the house rules.
Are there banned activities or substances?
Many leases include clauses that prohibit you from using a rental in certain ways. For example, there are usually clauses prohibiting excessive noise or other activities that might be a nuisance for your neighbors. It’s also typical for renters to not be allowed to run a business from a rental home or apartment. Usually this is the city’s rule, not the landlord’s, but it’s included in the lease to protect the landlord.
“Increasingly, landlords are including ‘no smoking’ clauses in their leases that allow them to end the lease and impose heavy cleaning costs on the renter if this rule is violated,” shares Bordo. “And often, there are lease terms that allow the landlord to end the lease if any illegal drugs or substances are used in the rental. With today’s unpredictable legal environment around substances like marijuana, it’s great to know before you sign.”
Can I sublet or Airbnb my rental?
Depending on your location and situation, you might be interested in making a bit of money by renting your place for a night here and there, or getting out of the lease early by passing it over to a friend or new renter (a sublet). Your lease will say whether or not these activities are allowed by your landlord.
What happens at the end of my lease?
This varies widely, often according to regional norms. In some places, it’s typical for leases to just end, with no provision for ongoing residency. In others, it’s common for leases to turn into a month-to-month lease after the first 12 months.
“You may also have some right of renewal, potentially at a pre-negotiated rent level, which can be highly valuable if you want to stay in your place at the end of the lease,” says Bordo. “Just scrutinize any language about rent increases at the time of renewal so you aren’t blindsided. Your lease should also state how much notice you must give if you want to move out.”
How do I get my security deposit back?
Usually there will be specific language about the security deposit return and what it means to satisfy the return requirements. Most landlords will require some amount of cleaning and restoration work before you move out. If you don’t want to do all the scrubbing yourself, some landlords have preferred cleaning companies that will check all the boxes on the cleaning list—guaranteed—so be sure to ask.
“While all leases are different, these are the main things you’re likely to see,” says Bordo. “If you have questions about a particular clause, your leasing agent or landlord should be able to answer your questions. Be sure to get all amendments and additions in writing before signing.
“Remember, the lease is often a sign of how easy or hard the landlord will be to get along with,” he concludes. “Highly complex leases aren’t usually a good sign. If yours is, you want to think hard about finding another landlord who’s easier to deal with.”
Your Lease Is Not Set in Stone Until You Sign. Here Are Ten Tips to Help You Negotiate Like a Pro.
Insights from Jonas Bordo, CEO and cofounder of Dwellsy, and coauthor along with Hannah Hildebolt of Everything You Need to Know About Renting But Didn’t Know to Ask: All the Insider Dirt to Help You Get the Best Deal and Avoid Disaster (Matt Holt, August 2023, ISBN: 978-1-6377439-2-8, $21.95)
You’ve read your lease (Right? Right!), and most of it looks acceptable—but there are a few things you’d like to add or change before signing. Maybe a parking space isn’t included in your rent when you thought it would be, or you’d like the landlord to cover a certain utility. The good news is, nothing is set in stone until you sign on the dotted line. You are allowed to ask your landlord to add, remove, or edit clauses that don’t suit you.
That said, a little time spent preparing will serve you well in this area. Here are 10 tips to help you negotiate rent like a pro—while staying on good terms with your prospective landlord.
Understand what you can ask for.
When negotiating a lease, the first thing that may come to mind is asking for a price break. While that’s certainly on the table, there are plenty of other clauses you might want to amend. Large landlords and corporations in particular are often inflexible on base rent, but can cut prices in other areas. A few things you might negotiate:
- Lower rent
- Free month of rent at the beginning of your lease
- Longer or shorter lease term
- Free pet rent, parking, gym access, or other amenities
- Landlord to pay utilities
- Predictable renewal terms, such as negotiating a maximum rent increase or a guarantee that you can renew your lease
Compare your rental to others in the area.
One of the best tools in your negotiation box is research. Take a look around at comparable rentals in the area. Maybe a parking space is free for lots of them, or the rent’s a little lower, or there’s no pet rent. Being able to bring these facts to the table will make your negotiating position stronger. Your landlord could be more willing to give you something if they know other landlords in the area are doing it.
Know exactly what you want.
If you’d like your security deposit to be reduced, by how much? If you want utilities to be included in the rent, which ones? By having a list of concrete requests in place, you will reduce misunderstandings and allow your landlord to respond with accuracy.
Think about what you can offer.
Landlords are more likely to bend their lease terms if you bring something to the table in return. To sweeten the pot, you could offer to:
- Help out with maintenance and/or yard work
- Commit to a longer lease—e.g., two years instead of one (A landlord who doesn’t need to worry about filling a vacancy might have more financial wiggle room.)
- Move in earlier
- Pay a higher monthly rent down the road for free rent up front
- Pay several months’ rent in advance
- Not utilize a valuable parking space
- Extend the termination notice from 30 days to 60 or 90 days
Understand your leverage.
If there were 20 people clamoring to submit applications at the tour, then the landlord can easily move on to another renter. If the place has been available for a little while and the landlord is still looking for a renter, then you have a better bargaining position. Still, keep your expectations realistic. If the rent is $1,500 and you want it to be $500, you’ll end up disappointed. But if you ask for a price drop to $1,400? You might have a shot.
Get the timing right if you’re renewing.
If you are renewing a pre-existing lease instead of signing a new one, don’t wait until the last minute. It’s best to start negotiating two or three months before your lease expires. This shows your landlord courtesy and gives you time to (potentially) find a new rental if you don’t come to an agreement. Plus, during this window, landlords are most likely to try their best to keep you as a tenant in order to avoid a vacancy.
Wait until you’re approved before you negotiate.
If you negotiate before you’ve even been approved, you might take yourself out of the running right away. After all, why should a landlord negotiate with you if other prospective renters might accept the lease terms as-is? However, if you negotiate after you’ve been approved, you already know the landlord is excited about you as a renter. They’ll likely be more willing to rearrange your contract a bit to suit you.
Landlords are often portrayed as greedy villains in popular culture, but in reality, they’re usually individuals who are just trying to pay their own bills. Kindness and courtesy during the negotiation process will not only keep things civil, they may actually be the thing that convinces the landlord to accept your request. Landlords have a big incentive to work with renters who are considerate, polite, and professional.
Be prepared for some back-and-forth.
If you don’t receive a straightforward “yes,” take time to consider the landlord’s objections and/or suggestions. There’s a good chance they’ll come back with a few different options you hadn’t considered before. You’ll have to evaluate them and decide what makes sense for you. You might have to ask yourself: How strongly do I feel about the apartment? Am I still willing to rent on the terms of the original lease? How flexible can I be with my original ask? Is it possible I could concede something more?
Read the revised lease.
Once you and your landlord have come to an agreement, make sure that the revised terms are written into the lease and that you both sign it. Otherwise, your negotiations won’t be legally binding. This is not the time to rely on a verbal agreement or handshake.
About Jonas Bordo:
Jonas Bordo is the coauthor, along with Hannah Hildebolt, of the book Everything You Need to Know About Renting But Didn’t Know to Ask: All the Insider Dirt to Help You Get the Best Deal and Avoid Disaster. He is the CEO and cofounder of Dwellsy, the free residential rental marketplace that makes it easy to find hard-to-find rentals.
About the Book:
Everything You Need to Know About Renting But Didn’t Know to Ask: All the Insider Dirt to Help You Get the Best Deal and Avoid Disaster (Matt Holt, August 2023, ISBN: 978-1-6377439-2-8, $21.95) is available from major online booksellers.
Dwellsy is the renter’s marketplace: a comprehensive residential home rentals marketplace based on the radical concept that true, organic search in a free ecosystem creates more value than the pay-to-play model embraced by all of the current rental listing services.