7 Extraordinary Lease Clauses That I Can’t Live Without

Written on August 3, 2015 by , updated on August 4, 2015

7 Extraordinary Lease ClausesMost standard leases will include basic information about the agreement, such as property address, dates, names of tenants, rent amount, security deposits, etc. However, the Devil is in the details.

Most experienced landlords will tell you that the Devil is in the details.

The real headaches come when a situation arises that is not addressed in the lease. By that point, the landlord is emotionally involved in the issue, and can’t truly be objective in his/her decision on how to handle it.

To help you prevent some headaches, I’ve listed seven of my favorite (and useful) lease clauses in the section below. 

These clauses have saved me dozens of hours of correspondence, and thousands of dollars in legal drama, simply because I put them in the lease.

With that said, I am not a lawyer so you should consult with a licensed local attorney before using these in your own leases. You are responsible for performing your own research and complying with all applicable laws in regards to your unique situation.

1. Severability

Though a legal precaution, this is perhaps one of the most important clauses in a lease. This clause states that if one aspect of the lease is found to be illegal, the rest of the agreement will still be legally binding.

Without this clause, a judge who has found one small clause to be illegal, even if accidentally so, might consider the entire lease to be void. No matter how rock-solid your lease is, you should include this clause in your lease.

2. Late Fees and Allocations

Though I’ve never had a late rent payment since I started using Cozy to collect rent, I always include this clause – just in case my tenant turns rebellious.

Further, if you don’t specify a late fee in your lease, it will be nearly impossible to charge a late fee after-the-fact.

Please check your state laws because some have statutes that require a specific “grace period” and limit the amount you can charge.

Regardless, this clause should specify the exact amount of the fee, the time at which it will be assigned, and if there are any additional, daily late fees for nonpayment.

The last sentence in this clauses ensures that all fees are paid first with whatever money the tenants choose to give me. The reason I allocate payments first to fees is because it’s much easier to sue a tenant for “unpaid rent” than it is for an “unpaid late fee.”

3. Subleasing

If you don’t outlaw subleasing, your tenants will do it when you’re not looking. Worse, you can’t penalize them for it.

You might be able to terminate the lease, but that’s not always preferable because then you have to find new tenants.

I always prefer to allow subleasing, for a price. I give my tenants the option to sublease, but they have to pay a one-time fee. Further, the sublessee has to submit an application and is subject to my normal screening process and subsequent approval, only to eventually sign a subleasing agreement.

Subleasing is common with my group houses. Many times, three of the five tenants will travel home for the summer and ask to sublet their room.

The answer is always “yes” and then almost instantly, my wallet feels $900 heavier. To help with the subleasing fee, many of the tenants increase the cost of their room, thereby offsetting the fee (which I’m fine with).

Related: The Landlord’s Guide to Tenant Screening

4. Joint and Several Liability

In respect to a residential lease, joint and several liability means that each tenant is jointly AND individually responsible for the entire rent amount and for any damages.

It allows you to consider all tenants as a single entity, for the purposes of giving notice, serving court documents, collecting rent or suing for damages.

Related: What is “Joint and Several Liability” and Why You Need It

5. Default

Many states have a set list of landlord and tenant obligations, in which either party can terminate the agreement if the other doesn’t fulfill his or her duties – with proper notice.

I go a step further and actually list the triggers for default in the lease, so that the tenant is aware of them. The logic is that if I ever have to terminate the lease for a violation, the lease should back me up.

As you may have noticed, upon default, I force the compiling of rent for the remainder of the lease term. Meaning, if my tenants start selling drugs from my rental in month three of a 12-month lease, I can still hold them responsible for the other nine months of rent (or until I find a replacement if I’m forced to mitigate damages).

Related: Landlord-Tenant State Laws and Regulations. Your state will have their own rules about how many days are required before you can terminate the lease after nonpayment or a lease violation.

6. Renewal

Lease renewal is a tricky thing. Some landlords prefer an automatic renewal approach, however, I prefer not to be tied down like that.

All of my fixed-term leases don’t automatically renew, however I still require a tenant to give me 60 days notice of their intent to move out at the end of the lease. Meaning, the assumption is that they will be renewing (assuming the rent doesn’t go up too much), even though the lease doesn’t automatically renew.

It just means that we need to sign a new lease if they want to stay.

The reason for this clause is that it guarantees that I have 60 days notice to try to find a new tenant. If they fail to provide 60 days notice of non-renewal, they are still held responsible for 60 days of rent, unless I can find a replacement sooner.

I usually set a Google calendar reminder, and I try to notify my tenants of their responsibility at 70-75 days from the end of the lease – so that they can start thinking about their options.

7. Use of Premises

Though I can’t discriminate based on familial status, I can restrict the number of people based on the number of people in the initial group of tenants. Meaning, if a family of four moves in, the lease should restrict usage to only those four people.

This clause keeps existing tenants from moving in unapproved “family” (yeah right), and keeps unemployed boyfriends or girlfriends from becoming rogue tenants.

BONUS: Surrender of Premises

Last but not least, this clause saves the day every time I have a tenant moving out.

A few weeks before they plan to move out, I simply remind them of this lease clause and send them the “move-out cleaning instructions,” which details my expectations and suggestions to ensure they get their full deposit back.

Where can I get a Full Lease?

Though I think these clauses are helpful, they are not a complete lease.

There only four websites that I recommend for premium, state-specific leases.

I, nor Cozy, are NOT affiliated with any of these companies. I just think they have excellent state-specific residential lease templates. You can read more about them on the Landlord Directory page.

Pay it Forward

Congratulations on reading the whole article! At 2,472 words, it’s about 4 times longer than my normal.

I’m curious to hear your stories. What are your personal or favorite lease clauses and how have they helped you with your rentals?

Let me know in the comments section below.

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100 CommentsLeave a Comment

  • Rose

    Hi Lucas, Im from Illinois. my tenant’s lease is going to end in 45 days. They have a balance from previous months rent. They want to renew their lease. I told them they can if they pay the full balance. Is that a valid answer?

  • Josephine Lawrence

    Recently, I had a tenant sue me for water damage done to her personal property while her personal property was in the basement of the leased home. Even though the lease specified that the owner and landlord was NOT responsible for the personal property of the tenant, she decided to sue anyway. I haven’t gotten an answer back from the judge on our hearing. I’d like to make this paragraph as legally tight as I can. Any suggestions for homes that have basements, garages, sheds, etc???? Maybe a special addendum so they can see what it is separately from the lease?
    Thanks!!!!

    • Kat J

      Hi! I’m curious of the outcome of your situation.

      It seems that a renter would have been required to carry renters insurance and a lease would have absolved you from damages to a renters items?

      • Josie Raimondi

        YOU are correct. We require renter’s insurance of ALL our tenants. She finally produced her policy, which my attorney thought was dated correctly. Long story short, the judge sided with us and I put in a special page at the back of my lease stating the landlord was not responsible with any personal property no matter where stored — garage, basement, house, storage buildings. A short paragraph of this was already in our lease, but I ask tenants to read, understand, and sign this extra page.

  • NP

    I use Landlord Protection Agency and they are great because they have leases available by state and also other great forms. I just pay the annual fee and then you can download all the forms for free.

  • Krys

    Great Article! I’ve learned a lot from it. Question – If I have a tenant who is offering to pay in full and received a discount on the lease. Is it a good idea to do it? Is there a clause that should be included in the lease agreement that says this is non-refundable ? Is it legal for the state of illinois to collect rent for 12 month period up front? Thank you

    • Lucas Hall

      Hi Krys

      I don’t believe there is a limit on pre-paid rent that you can collect in Illinois – but feel free to read through the statutes: https://www.landlordology.com/illinois-landlord-tenant-laws/

      Generally speaking, very few tenants are willing to offer 12 months up front. In my experience, it’s generally a sign that something isn’t as it appears. For example, are they going to move in other relatives you haven’t met?

      If you do accept it, make sure you keep it in a separate bank account, as not to co-mingle it.

      Personally, I wouldn’t do it, simply because I wouldn’t want to offer a discount on rent. Choosing a highly qualified applicant will pay on time every month, so having the money up front only cost me revenue.

  • Doug Arnold

    Mutual respect will do better than the self-righteous attitude in these articles which eliminate tenants, not desperate and with half a brain.
    If you can’t handle that renters are people who don’t expect to walk on eggshells, don’t take their money. Fees amounting to more than your cost make a mean-spirited asshole AND thief
    who punishing tenants for being tenants. I am not extraordinary. I am responsible and leave places better than I find them. I use building experience from work while in school to collaborate with owners, at no cost, and make improvements even fix pre-existing conditions! I have disgusting horror stories high-rent slumlords, but even given legal remedies, I paid on time and left.
    I will never rent from you.

    • Shelly

      Doug,
      While I appreciate your comment, apparently you have never sat in the landlord’s chair. Having the greatest intentions from a tenant only to find that their appreciation for your property only lasted a few days. Then you find out that they have an aggressive dog in your home and are operating a rap music business out of the garage all through social media photos posted by the tenant! Landlords provide a service to tenants and vice versa. Having a thorough agreement protects both parties and no-one is forcing a tenant to sign. If you dislike such agreement, then don’t sign it and rent elsewhere.

      • Marc

        Hi Shelly,

        Maybe be a little more careful with your wording next time. Because we all know that your sentence about “operating a rap music business out of the garage” is code for “I don’t like black people.”

        • julia sullivan

          Bulls@#t!

        • P.Lee

          What an assumption on YOUR part…duh, I know PLENTY of people who are NOT black that LOVE Rap….geesh…get a life!

        • Bill S.

          Marc, Whatever. No we DON’T know what words mean what in YOUR “code” language. And WHY DOES IT HAVE TO BE BLACK?!?!? Doesn’t the range of aspiring rappers include people of Hispanic, Euro, Asian, Slavic, African, Middle Eastern, and mixed decent and elsewhere? I guess Eminem is just really light complected, so is Iggy Azalea, what about Pitbull, Khaled, etc etc… But let’s ignore here and other countries rap artists because only USING “black people” fits your narrative better. With your comment in mind, here’s something that will probably piss you off, ALL yes ALL LIVES MATTER!!!

  • Eric

    I have a tenant who has a business, not at the rental. He has started to store some of the equipment at the rental.what can i do.he rents a to on but now he hasstuff in backyard, on back porch , in the mudroom, what can i do ?

  • Gabrielle

    Lucas, thank you for this article. I’m looking for a 3 bedroom apartment and I’d like to request the property manager to allow me to add two roommates as subtenants. I’m perfectly capable of paying rent by myself but I plan to move out of state in two years and I want to start saving towards my new home. I do not want to add them as co-tenants because I want to be able to evict a roommate who doesn’t pay rent rather than to “sponsor it”. Unfortunately, most apartment complexes hire non-professional individuals to handle their front desks, and I often find myself trying to explain this request to someone that doesn’t get paid enough to care. I have excellent credit and enough savings to pay a few months rent in advance. Any suggestion?

    • Lucas Hall

      Hi Gabrielle

      I bet that can be difficult. Unfortunately, most corporate apt complexes have standard leases that they won’t deviate from, even if the front desk wanted to help you.

      My only suggestion is to try and find a smaller, private housing provider, like an independent landlord, who can make decisions without

    • Lucas Hall

      Hi Gabrielle

      I bet that can be difficult. Unfortunately, most corporate apt complexes have standard leases that they won’t deviate from, even if the front desk wanted to help you.

      My only suggestion is to try and find a smaller, private housing provider, like an independent landlord, who can make decisions without going up 5 levels of management.

      With that said, I fear that most landlords won’t let you do what you want. It’s just simply too much risk. You’d have to compensate them for the extra risk, so keep that in mind when you propose the idea.

  • Gayle Botn

    Luxas
    I am a first time landlord and my husband and I renting our house out. Someone is wants the house for 5 years. That sounds great, but I have 2 questions:

    1) can we put something in the lease that says if we need to sell for some reason,we can give notice and get out of terms? What would you do?

    2) if prices increase for interest rates…is there a clause to raise rent?

    Thanks!

  • Gail Donley

    Curious if a lease of 4 years must have a clause of renewability after ever year or will a judge honor a 4 year fixed term lease?

    • Lucas Hall

      Hi Gail,

      That would be a great question for a local attorney. Laws vary by county.

      I’ve not seen any statute, anywhere, that requires a forced year to year renewal – but I’m not a lawyer.

  • Herve-Patrick

    Hey I have a tenant who it would seem has invited additional guests into the apartment. I actually do have the use of premise clause in my lease but not complete like yours. I fear that they will be a disturbing bunch seeing as he is quite loud himself. Is there anything suggestions you would have?

    Thank you

    • Lucas Hall

      Hi Herve

      I suggest approaching the tenant and telling that it’s no okay to do what they are doing. If they push back, then talk to a lawyer and he/she will be able to tell you how much power your current lease gives you to prohibit this behavior.

  • abdo showah

    I enjoyed reading your helpful article . i wonder if all the websites you listed at the bottom of your article do include all of the helpful clauses you listed as part of their full lease agreement ?

    Thanks

  • Ossie Rivera

    As a new property manager I find this article to be an easy read and very useful. I will definitely add these clauses to my lease. Thank you!

  • Katie

    Great article! Bookmarked so I can amend some points for my current leases!

  • Azad Joomun

    Hi
    I just want to have a clause that I can apply in my residential lease on when I died my premises won’t be rent

  • Mariana

    Hi Lucas
    I’m about to rent my house which has 2 bedrooms and an unpermitted bonus room ( this is not an addition. The area that the room is in is permitted, we just divided the space by adding a wall, door and window. the room meets the city requirement but it’s not not permitted as a room). How should I list this house ?2 bedrooms plus bonus room? How do I write this in the lease agreement?

  • Rachel Lindquist

    This might not apply to the impulsive / average tenants in your area, but if I read your lease and saw all the million and one earmarks you’ve placed to fine and/or potentially take advantage of me as a tenant, I would never sign a lease with you…

  • K.L.

    I know this is an American website, but still gonna make a comment just in case. Part 2. Late payment fees and allocations; doing this in Australia is illegal. You cannot charge a tenant late payment fees and if you try to get a tenant to sign an agreement with this clause you can be fined. If your tenant doesn’t pay the rent on time, you fill out a breach notice and then you can lodge it with the relevant tenant authority.

    I know this is a generalization, but the view in Australia is that if your a landlord/owner, you are in a position of power over your tenants, as such the law is geared to protect tenants. As such, be careful with using special conditions like these as they may not be legal (or fair).

  • landlords worst nightmare!

    New renters in hm already, But got bad ck from old account. Fl. 3 day notice states only rent no late fees on 3 day notice unless lease says for rent, my lease says late fees of 25.00 a day will be charged until rent pd. So what about security? Check was for 2000.00 & they gave 1000 cash, rent -1525 & security -1500., Im so confused, I know if not correct amt judge can throw out case. They also have violated lease agreement in many ways, unauthorized pet, lawn not mowed, tore up tile floors, an never got renters insurance per lease. 1st eviction, in 10yrs, Its been 13 days now , cant pay a attornet, can I send both at same time: 3 day for pay or quit for 1525 or 2000? And 7 day for all lease violation an bad check? Please help if u can..

    • kathy

      landlords worst nightmare,
      You need to be more clear about your numbers. What I get from your confusing message is:
      RENT/month = $ 1525
      Security Deposit = $ 1500
      So the total you were supposed to collect was $3025 for the first move in rent month. What you actually collected was $1000 in cash, because the $2000 check bounced. And, now you are also accruing late fees, up to the date they moved out or paid the rent. You must calculate the #’s, and use them in your notice to pay/quit. The answers to your questions depend on what your lease specifically lays out, AND your state’s laws. Many attorneys will do a discounted or “free” one time consultation. Many also offer a sliding scale. Good luck.

  • Alexis Raben

    Hi Lucas,

    My tenants of over 3 years decided to break the lease 4 months prior to contractual end. They informed me of their intentions less than a month in advance of departure.

    I explained that I would have liked to try to accomodate but was about to be out of the country for several months and couldn’t work on re-rentinging, and asked them to abide by their contractual obligations.

    After much back and forth, they paid for 1 more month. And then simply left. I kept the security deposit but was left with the property vacant for over two months of the most difficult rental season.

    Small claims court or hiring an attorney seems more hassle than money returned. Do you have other advice? Or precautions for the future?

    Many thanks!

  • EDWARD SCIACCA

    I DON’T SEE ANY ANSWERS TO HOW TO COLLECT MONEY OWED.
    LIKE IS IT LEGAL TO PUT IN A LEASE A CAR/ 401K/ROTH/OR STPULATION ON DIRECT PAYMENT FROM
    A PAY CHECK.
    BASICLY MAKE IT EASY FOR THE LANDLORD.
    I AM STUCK FOR $3550 BACK RENT AND $5000 in property damage.
    can u give me some insight.
    thank u
    ED

  • Sandy

    Hi Edward, here is a thought for you, not for the damages but for the back rent owed. Give them a 1099 for miscellaneous income. After all they did receive benefit for living in your property without paying rent, so in effect they received income. That will really screw them up when they are expecting a tax refund and they don’t get it. Maybe if more people did this more tenants would pay the rent that they owe. I am over tenants that don’t pay rent and cause damages. For the damages send out the forfeit letter for security deposit letter file a suit in small claims and get a money judgement. If this person owns anything free and clear levy against it with the sheriff auction their property off, get paid or own what you levy on.

  • Jas

    In the sublease section- I want to clarify that the verbiage is correct. It’s states that the “landlord reserves the right to reject and sublessee that does qualify”. I just want to make sure that it shouldn’t say “does NOT* qualify”.
    Thanks for all of the great ideas and information!

  • Drita Protopapa

    I am a new landlord looking for solid advice on do’s and don’ts, best practices, etc.

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