Property Management Agreement (image: c-rem.com)
Are you you rental property owner in Silicon Valley? Are you using your own contracts rental lease agreements? Well, you might be taking some un-necessary risks.
Web sites such as a LegalZoom, RoketLawyer and NoloPress offer some forms for property management, but you need to make sure that these contracts are valid in California and contain the similar language that’s contained in California Association of Realtors (CAR).
The CAR contract has more than 55 legal clauses and we have written extensively about which clauses are most critical. However if you do not have access to a Reatlor and CAR rental lease agreement , then you need to add these 5 items into your agreement.
They are:
1) Rent Collection: This section of your Rental lease agreement would define when the rent is due to the hour and the calender day of the month. This section will also define the late fee if the rent is not delivered on time. Using apps like Cozy with online payment options can eliminate the headaches of collecting rent by checks.
2) Security Deposit: Security deposits are the source of most tenant and owner disputes specially in cases where the condition of the property is not well documented prior to the tenants occupying the property. California law requires that the deposit must be returned by 30 days after the property has been vacated. That’s why in our rental lease agreements we include a condition check list prior to the occupancy and have the tenants initial each page prior to possession.
3) Sublease: Your Rental Lease Agreement should prohibit your tenant from subleasing your home to other tenants without explicit authorization.
4) Dispute Resolution: By agreeing to use mediation and arbitration to resolve any disputes both parties avoid lengthy court battles which are costly for everyone not to mention time consuming. So, make sure you include clauses that force both parties touse arbitration before seeking judicial remedies.
5) Drugs: You need to include a clause that you will not tolerate use and storage of any toxic and flammable chemicals that can be used in the production of meth or other drugs. Also, there is a risk that if your tenant was using income from drugs to pay your rent, you might be tagged as the beneficiary of his/her drug trade which could create huge headaches for you as the landlord.
Your can review our blogs about all the clauses that are covered in the California Rental Lease Agreement. We use a CAR agreement to manage properties for our clients in San Jose, Los Gatos and Campbell.
Also, feel free to Contact Us if you have any question about what else you will need to include in your Rental Lease Agreement to be safe.
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