A lease agreement defines terms of tenancy within the parameters of federal, state, and local laws. It’s not just legal mumbo-jumbo; it’s an important contract that defines tenant and landlord obligations and rights.
Oddly enough, it’s technically legal to just have an oral agreement around the terms of your lease, but we wouldn’t recommend it: a written lease you can refer back to will make settling disputes much easier. Also, if your lease agreement is for a period of more than one year, an oral lease is not an option—your lease must be put in writing to comply with Michigan state law.
When you’re looking at your lease agreement, here’s what you should see:
The basics: It’s important that your lease agreement includes the names, addresses, and signatures of everyone involved. How can you hold people responsible if you don’t know their name or contact info? In Michigan, the lease must also include a very specific statement acknowledging that the agreement must comply with Michigan state law.
The tricky: If you’re a renter signing a lease with another tenant, your agreement may define the tenancy as “joint and several.” This makes you responsible not only for your individual obligations, but also for the obligations of all other tenants. This includes paying rent and performing all other terms of the lease.
Main takeaway? Unless you’re prepared to foot the bill, don’t sign on for joint tenancy with someone you don’t trust.
The recurring: Your lease agreement should define when and how do you pay rent and utilities. It usually boils down to how much the tenant will pay to the landlord each month, and who covers utilities. It may also specify where and how you pay: for example, if a landlord only accepts online payments.
The timeline: In a fixed tenancy, the lease agreement will define a set time period in which the tenant is obligated to pay a certain amount for a certain amount of time. On the one hand, this limits the landlord’s ability to raise rent or end the lease during the fixed timeframe. On the other hand, the tenant is bound to the lease terms, guaranteeing monthly payment of the agreed upon amount.
The one-time payments: In addition to rent and utilities, lease agreements often stipulate security deposits and fees that the tenant must pay at the start of the lease. There are some state-specific rules around these one time payments which you may need to be aware of, but the main thing to know is that most fees are for good while security deposits you can get back.
The what-ifs: Lease agreements should at least touch upon who’s responsible for repair and maintenance of the property. This can be general (for example, the landlord may take responsibility for all repair and maintenance costs) or more specific (for example, the landlord may take responsibility for unavoidable costs such as old appliances breaking down, but not costs related to the tenant’s activities such as pet-related damage to the property or pests that are attracted by crumbs).
In Michigan, as in almost every state, landlords are required to maintain a certain standard of habitability at their properties. This usually includes things like running water and electricity, heat in the winter, and functional walls and roofs.
The particular: It’s natural for landlords to care about their property, and to protect its value, they may make some additional rules. No smoking, no pets, and no parking on the grass are three common examples of legal lease provisions a landlord may stipulate.
Lease can include all kinds of weird terms—for example, it’d be legal to ban tenants from parking red cars in the driveway—but provisions cannot violate local, state, or federal law. For example, when a Florida Apartment complex imposed a “no bad reviews” clause, they got in trouble for impinging on tenants’ freedom of speech.
We’ll dive more into what’s legal and what’s not in next week’s article on legal and illegal lease provisions!