11 Terms to Include in Your California Lease or Rental Agreement
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A lease or rental agreement is a legal contract between landlord and tenant, as well as an immensely practical document full of crucial business details, such as how long the tenant can occupy the property and the amount of security deposit you can charge. (California, for example, limits the amount to two months’ rent (three months if the unit is furnished, and an additional one-half month’s rent when the tenant has a waterbed).
Terms to Include
Here are 11 important items to cover in your California lease or rental agreement.
1. Names of All Tenants
Every adult who lives in the rental unit, including both members of a married or unmarried couple, should be named as tenants and sign the lease or rental agreement. This makes each tenant legally responsible for all terms, including the full amount of the rent and the proper use of the property. This means that you can legally seek the entire rent from any one of the tenants should the others skip out or be unable to pay; and if one tenant violates an important term of the tenancy, you can terminate the tenancy for all tenants on that lease or rental agreement.
2. Limits on Occupancy
Your agreement should clearly specify that the rental unit is the residence of only the tenants who have signed the lease and their minor children. This guarantees your right to determine who lives in your property -- ideally, people whom you have screened and approved -- and to limit the number of occupants. The value of this clause is that it gives you grounds to evict a tenant who moves in a friend or relative, or sublets the unit, without your permission.
3. Term of the Tenancy: Rental Agreement vs. Lease
Every California rental document should state whether it is a rental agreement or a fixed-term lease. Here’s the difference:
Rental agreements usually run from month-to-month and self-renew unless terminated by the landlord or tenant. Your rental agreement should specify:
- the date the agreement begins
- how much notice you and the tenant must provide to end the tenancy (it’s 30 days for both landlord and tenant, except for tenancies that last one or more years, in which case the landlord must give 60 days’ notice to end the tenancy), and
- how much notice you must give to change a clause of the rental agreement (you must give 30 days’ notice (or 60 days, in some circumstances involving a rent increase).
If you are using a lease, you will set a specific beginning and expiration date. A lease obligates both landlord and tenant to a specific term, typically a year.
Your California lease or rental agreement should provide specific details on the rent, including:
- the amount of rent
- when it is due (typically, the first of the month), and whether there’s any grace period before rent is considered late
- how rent is to be paid, such as by mail or delivered to a specific address, such as your office (and the hours when rent can be paid at that address)
- acceptable payment methods (such as personal check only)
- whether late fees will be due if rent is not paid on time and the amount of the fee, and
- any bounced-check fee you’ll charge if the tenant gives you a check that the bank will not honor (California law limits the amount to $25 for first checks, and $35 for subsequent rejected checks).
If you own rental property in one of the 15 California communities with some form of rent control, you may need to provide additional information in your lease or rental agreement.
5. Security Deposit
The use and return of security deposits is a frequent source of friction between landlords and tenants. To avoid confusion and legal hassles, your California lease or rental agreement should be clear on all the details. Here are the major ones:
- The dollar amount and use of the security deposit. California limits the amount you may charge to two months’ rent (three months’ rent if the unit is furnished and an additional half a month’s rent when the tenant has a waterbed).
- Use of the deposit, such as to cover unpaid rent. It’s also a good idea to spell out how the tenant may not use the deposit (such as applying it to last month's rent).
- When and how you will return the deposit. By California law, you must itemize and return the deposit within three weeks after the tenant moves out.
- Security deposit interest payments. If you will pay interest on deposits (it’s not required under state law, but many cities do), provide details in your lease or rental agreement.
6. Repairs and Maintenance
Your best defense against rent-withholding hassles and other problems (especially over security deposits) is to clearly set out responsibilities for repairs and maintenance in your lease or rental agreement, including:
- the tenant's responsibility to keep the rental premises clean and sanitary and to pay for any damage caused by his or her abuse or neglect
- a requirement that the tenant alert you to defective or dangerous conditions in the rental property, with specific details on your procedures for handling complaint and repair requests, and
- restrictions on tenant repairs and alterations, such as adding a built-in dishwasher, installing a burglar alarm system, or painting walls without your permission.
7. Entry to Rental Property
To avoid tenant claims of illegal entry or violation of privacy rights, your lease or rental agreement should clarify your legal right of access to the property -- for example, to make repairs -- and state how much advance notice you will provide the tenant before entering. California requires “reasonable notice,” which should be at least 24 hours (except in cases of emergency); the notice period is 48 hours if the entry is a move-out inspection requested by the tenant regarding possible security deposit deductions.
8. Restrictions on Tenant Illegal Activity
To avoid trouble among your tenants, prevent property damage, and limit your exposure to lawsuits from residents and neighbors, you should include an explicit lease or rental agreement clause prohibiting disruptive behavior, such as excessive noise, and illegal activity, such as drug dealing.
If you do not allow pets, be sure your lease or rental agreement is clear on the subject. If you do allow pets, you should identify any special restrictions, such as a limit on the size or number of pets or a requirement that the tenant will keep the yard free of all animal waste.
Federal law require landlords to make certain lead-based paint disclosures before tenants move in. California also requires that landlords provide several disclosures to tenants, including the availability of a state database of registered sex offenders and the presence of mold in the building. In addition, you must inform tenants if the tenant’s gas or electric meter services areas beyond the tenant’s rented space, and provide details on how you will handle billing in this situation.
11. Other Restrictions
Be sure your lease or rental agreement complies with all relevant state and local California laws including health and safety codes, occupancy rules, and antidiscrimination laws. Any other legal restrictions, such as limits on the type of business a tenant may run from home, should also be spelled out in the lease or rental agreement. Important rules and regulations covering parking and use of common areas should be specifically mentioned in the lease or rental agreement.
If you own rent-controlled property, be sure to check your local ordinance for special rules that apply to leases and rental agreements.
Where to Find California Lease and Rental Forms
For California rental documents, including leases and rental agreements, see the Real Estate and Property Forms section of Nolo. These ready-to-use legal forms include detailed, clause-by-clause instructions, that cover the rights and responsibilities of landlords and tenants in California. Options include the following: