What Is a Lease Agreement?

A lease specifies the term for which the rental arrangement is in effect, which is usually six or twelve months. Most leases are in writing. Some verbal leases are legal and enforceable. However, if the lease is for a term of more than one year, it must be in writing.

Once you and your tenants have signed the lease, all parties are legally bound by it until the end of the lease term (for example, at the end of 12 months). This means that your tenant must pay the rent and you must perform all of your obligations under the lease during the entire lease period.

The terms of the lease are set in stone. You will not be able to raise the rent in the middle of a lease, nor can you change the terms whenever you feel like it. A notable exception to this policy if you have an addendum to the lease signed and agreed upon by both you and your tenants.

Furthermore, a lease means you can’t just ask your tenant to leave unless there’s a good reason, like if your tenant breaches the lease terms, damages the property, or fails to pay rent.