Moving In

Types of Rental Agreements

A rental agreement between the landlord and tenant sets down the terms to be followed while the tenant lives in the rental unit. The following is a description of the two most common types of rental agreements: leases and month-to-month rental agreements.

Whatever a rental agreement is called, it is important to read the document carefully to learn its exact terms.

Month-to-Month Agreement

This agreement is for an indefinite period of time, with rent usually payable on a monthly basis. The agreement itself can be in writing or oral. If any type of fee or refundable deposit is required, the agreement must be made in writing.

A month-to-month agreement continues until either the landlord or tenant gives proper notice to end it.

The rent can be raised or the rules changed at any time, provided the landlord gives the tenant proper notice.

Lease

A lease requires that the tenant stay for a specific length of time and restricts the landlord's ability to change the terms of the rental agreement. A lease must be in writing.

During the lease term, rent cannot be raised or rules changed unless the landlord and tenant agree.

Leases of one year or more are exempt from the Landlord-Tenant Act, but only if the tenant's attorney has approved such an exemption.

Illegal Provisions in Rental Agreements

Some provisions that sometimes appear in rental agreements or leases are not legal and cannot be enforced:

  • A provision allowing the landlord to enter the rental unit without proper notice
  • A provision limiting the landlord's liability in situations where the landlord would normally be responsible
  • A provision requiring stating the tenant will pay the landlord's attorney's fees under any circumstances if a dispute goes to court
  • A provision requiring tenants to give up the right to defend themselves in court against a landlord's accusations
  • A provision requiring tenants to pay for all damage to the unit, even if caused by someone other than the tenants or their guests
  • A provision requiring the tenant to agree to a particular arbitrator at the time the rental agreement is entered into
  • A provision that allows the landlord to seize a tenant's property if the tenant falls behind in rent
  • A provision that waives a tenant's rights under the Landlord Tenant Act

Deposits & Other Fees

When a new tenant moves in, the landlord often collects money to cover such things as cleaning or damage. The money collected may be refundable or nonrefundable.

Refundable Deposits

Under the Landlord-Tenant Act, the term deposit can only be applied to money that may be refunded to the tenant.

If a refundable deposit is being charged, the law requires:

  • A checklist or statement describing the condition of the rental unit must be completed, the landlord and tenant must sign it, and the tenant must be given a copy
  • The deposits must be placed in a trust account in a bank or escrow company.
    • The tenant must be informed in writing where the deposits are being kept unless some other agreement has been made in writing, any interest earned by the deposit belongs to the landlord
  • The rental agreement must be in writing, it must say what each deposit is for and what the tenant must do in order to get the money back
  • The tenant must be given a written receipt for each deposit

Nonrefundable Fees

These will not be returned to the tenant under any circumstances. If a nonrefundable fee is being charged, the rental agreement must be in writing and must state that the fee will not be returned. A nonrefundable fee cannot legally be called a deposit.