Are you thinking about renting out a property in Oklahoma City or the surrounding areas? As one of the most populated cities in the state, Oklahoma City has a high demand for both residential and commercial rental properties. By renting out a house, condo, or apartment in this city to long-term tenants, you can earn a steady passive income, as well as grow your wealth as your investment grows in value over time.
While investing in the Oklahoma City rental market can be an incredibly lucrative venture, it doesn’t come without risks. Tenant-caused damages, missed or late payments, disputes, and evictions are some of the biggest challenges landlords face. Luckily, you can get ahead of these issues by drafting a solid lease agreement!
The Importance of Drafting a Solid Lease Agreement
A lease agreement is a legally binding contract that outlines the terms under which a property is being rented. A well-written lease clearly outlines the rights, responsibilities, and expectations of both the landlord and their tenants, reducing the likelihood of misunderstandings. It should cover important details like rent payment terms, security deposits, property maintenance responsibilities, and lease duration, providing legal protection in case of disagreements.
A comprehensive lease also ensures compliance with local laws, protecting landlords from potential legal issues. For tenants, it sets clear expectations about living conditions, rules, and payment terms, promoting a transparent and harmonious rental experience.
Additionally, a strong lease can help resolve disputes quickly by offering a reference point for both parties, minimizing conflicts, and fostering a positive long-term relationship. All in all, a solid lease agreement contributes to a smooth, professional rental process.
How to Draft a Solid Lease Agreement
Here are some tips to help you draft a strong lease agreement:
1. Familiarize Yourself with Local Rental Laws
Landlord-tenant laws can vary widely from state to state. Before drafting your lease, you must take the time to read and understand your local rental laws. Pay close attention to the state’s rent control laws, security deposit regulations, fair housing laws, and eviction laws. This will help you ensure compliance and foster a more positive relationship with tenants.
2. Gather All the Information You’ll Need
A lease agreement is a contract. For it to be legally binding, it must contain key information such as the names, addresses, and contact information of all parties involved. That includes you and all tenants over 18. Additionally, you should include key information about the property that’s being rented, like the full address, unit number (if applicable), a brief description, and a list of all areas included in the rental such as a garage, parking spots, and communal areas. By ensuring you have all the information you need beforehand, it’ll be easier to draft your lease.
3. Outline the Terms of the Lease
When drafting your lease, you should clearly state the duration of the tenancy. If it’s a fixed-term lease, you should write down the exact start and end dates of the occupancy. If it’s a flexible lease, you have to write down the approximate duration, as well as the requirements for ending or renewing it. This will help you prevent misunderstandings and holdover tenancies.
4. Write Down the Rent Price
Your lease agreement should include the price of rent, due date, and late fee policies. Additionally, you must outline the accepted payment methods. This will help ensure that tenants know when rent is due and prevent missed payments.
5. Outline the Security Deposits Rules and Requirements
Security deposits are highly beneficial to landlords, functioning as a financial safety net. That said, they’re a common source of landlord-tenant disputes. To avoid security deposit disputes, your lease should clearly outline the amount of the deposit and the conditions under which it’ll be returned. You can also write a list of potential deductions so tenants know why they may not get their full deposit back.
6. Outline Tenant Responsibilities
Maintaining a rental property is a shared responsibility between landlords and tenants. To ensure that renters take good care of your rental and avoid misunderstandings, you must clearly outline tenants’ maintenance responsibilities. Additionally, you must also include rules and regulations for restrictions on modifications, noise levels, pets, smoking restrictions, and parking policies.
7. Include Mandatory Disclosures
As a landlord, you’re required to inform tenants of issues that affect the condition of your property. These are some of the mandatory disclosures that your lease should include when renting a property in Oklahoma:
- Lead-Based Paint: If your property was built before 1978, you must provide information about concentrations of lead-based paint on the premises.
- Flooding: You must notify tenants if the property has been subjected to flooding in the past five years or is in a flood zone.
- Authorized Authorities: You must provide tenants with all the names and contact information of people involved in the management of the property, such as property managers.
8. Proofread and Edit
The lease is the foundation of a rental agreement. As a landlord, you must ensure that all your leases have all the information they need and are well-written to avoid misunderstandings.
Make sure to proofread it several times and make as many corrections as needed before asking tenants to sign it. You should also consider working with a professional property manager or attorney to ensure that the lease complies with all rental laws.
Bottom Line
As a landlord, you should never rent out a property without signing a lease. A rental agreement makes it possible to hold tenants accountable for rent payments or property damages. Additionally, a signed contract can be used as evidence in case of legal disputes. Now that you know how to draft a solid lease agreement, you can keep your rental property protected at all times.
If you need help drafting a lease agreement for your Oklahoma City rental, contact OKC Homes 4 You and speak with our property management experts!
