A thorough and rock-solid lease agreement with your tenant is critical in ensuring you’ve protected yourself in case your tenant defaults on their lease obligation. Yet many landlords neglect to take the necessary steps to protect themselves and their property. Ultimately, without a comprehensive lease agreement, many landlords find themselves tangled up in financial burdens, lost revenue, damage to their investment which could potentially cost them thousands of dollars in repair bills, and the daunting task of eviction.

Why is a lease so important? Very simply, it’s a legal document that states the specific terms of occupancy between the owner and the tenant during the tenant’s occupancy of your property, including the amount of rent, when rent is due (and late), how much late fees are, who is responsible for repairs, pest control, weed abatement, and all of the other variables that should be spelled out clearly before your tenants take occupancy. In other words, your lease with your tenants tells them what is expected from them and what will happen if they breach the contract they signed with you.

There is generally only one reason a landlord rents a property – revenue. Everything a landlord does in regards to their rental property is aimed at maximizing the amount of income the property will generate. Unfortunately, many landlords and homeowners don’t consider the importance of this document. Your lease agreement will, in most cases, make or break your case if you ever find yourself in front of a judge during an eviction hearing, or suing for damages to your property or financial damages due to lost rent.

Taking the time to ensure you have a very thorough lease agreement with your tenants will help ensure you get the most out of your investment, will give you security of a ‘win’ if you never need to take legal action against your tenants, and provide peace of mind knowing that all terms were clearly spelled out and there is no grey area with who’s responsible for what.