How To Create A Basic Residential Lease Agreement Template

“How To Create A Basic Residential Lease Agreement Template” written by Mike Marko

Tired of repeatedly editing a residential lease agreement template to fit your residential property management business needs?

A good residential lease agreement is customized for the properties you are managing and is detailed to handle anything that may occur during the rental of a property.

To save time and money from having to customize a residential lease every time you have a new tenant, you should create your own basic residential lease template.

Creating your own customized residential lease this will help you minimize your time searching for templates, editing, or perhaps even creating customized lease agreements repeatedly. Deducting the time spent on this task will allow you to give more attention to your other obligations as a property manager.

Creating your own residential lease agreement template is easy. You do not have to earn a law degree to do it (though it helps to have someone who does have to check it!)

In this blog post, we’ll share a simple guide to help you write your own residential lease agreement template.

Steps In Creating A Basic Template Of A Residential Lease Agreement

What is a residential lease agreement?

A residential lease agreement is a legal contract that defines the relationship and terms agreed to between a landlord and a tenant. It normally includes different kinds of clauses, such as the rent rate, the responsible party for maintenance, inspection dates and so on. It is designed to protect the interests of both parties and settle any disputes if they arise.

It is, therefore, vital to have a strong residential lease agreement in place to ensure that you are well-protected and that both parties are fairly treated. Below are the basic steps in creating a standard residential lease agreement template:

Part 1: Lease Introduction

The first part of every lease agreement is the introduction.

The introduction comprises three different elements that must be included:

1) The section stating the date of the agreement, the landlord’s name and address, and the tenants’;

2) The property to be rented; and lastly,

3) The section detailing the “Agreement to Lease.”

Here’s an example:

This Lease Agreement (“this Agreement”) is made this day __ of ____, ___ by and between ____ located at ____ (“Landlord”) and ____, located at _____ (“Tenant”). Each tenant is jointly and severally liable to Landlord for payment of rent and performance in accordance with all other terms of this Agreement.

Premises. The premises is a _____, located at _____ (“Premises”).

Agreement to Lease. Landlord agrees to lease to Tenant and Tenant agrees to lease from Landlord, the Premises according to the terms and conditions of this Agreement.

Part 2: Term Of The Lease

The term of the lease refers to the duration the tenant will be renting the property. This section will need to have the start date indicated, as well as the end date. There are two options for the lease agreement term: month-to-month and lease terms.

Month-to-month option means the tenancy is set up on a month to month basis and continues on a monthly basis, whereas a lease term refers to a tenancy that lasts for one calendar year or a specified period of time. It is important to list in the terms the option to be used.

Here’s an example:

Term. The Lease will be for a term of __ months, beginning on ____ and ending on ____ (the “Term”).

[Option1] Month-t0-month. The rental tenancy of the Property will begin and continue on a month-to-month basis until terminated under the terms of this agreement.

[OPTION 2] Lease.  The lease term of the Property will continue for one calendar year or until ___.  Any holdover of the Property thereafter will be on a month-to-month basis.

Part 3: Rent And Other Monetary Clauses

This clause includes the rent rate and payment date. This may also include other details relating to the financial set-up between the landlord and the tenant. All details regarding Rent and other monetary clauses need to be specified in the terms of the agreement.


The first step is to determine the fair amount of rent to charge the tenant.

It is best to start the rent clause with “The tenant agrees to pay…” and then indicate the amount of rent that has been agreed upon, and the date when it should be paid. The payment options provided to the tenant must also be specified – whether it be through online transfer, via bank deposit, money order, or personal check.

Here’s an example:

Rent. The Tenant agrees to pay the Landlord a monthly rent of ____. The rent is payable in advance due on every __ of each month during the Term. The rent will be paid to the Landlord at the Landlord’s address stated above by mail or in person and accepted via one of the following methods: 1) Personal check; 2) Money Order 3) Bank Direct Deposit.

Security Deposit

Normally the security deposit is determined by adding the first and last months rents total, with any pet or children damage deposit. The security deposit must be paid on the day the lease is signed. Because of this, it is crucial that the amount of security deposit owed must already be written in the lease.

A common mistake made by tenants is assuming that the security deposit equates to a payment of rent. Because this is not the case and to avoid unnecessary stress, later on, it is advised to declare in the terms of the clause, that it cannot be treated as such.

Aside from the amount, this clause must have an itemized statement of what is included in the deposit. If replacement or cleaning of carpets is desired then you need to detail that in the security deposit uses when the tenant vacates the property.

Here’s an example:

Security Deposit. The Tenant will pay Landlord a security deposit of __ on the day this Agreement is signed.  A landlord is not required to keep security deposit funds in a trust account, nor required to pay any interest on it, unless required by law.

Within 30 days of the termination of this Lease (and Tenant vacating the Property), the landlord will provide the tenants with an itemized statement indicating any retention of:

  • any portions of the Security Deposit amount for the cost of repair,
  • or cleaning above and beyond the ordinary wear and tear on the Property,
  • or any other sums due to Landlord under this Residential Lease Agreement.  

Late Fees And Charges For Returned Checks

It is not uncommon to come across tenants who will try to negotiate a postponement in payment date. Detailing a specific amount for late payments, a daily rate for late payments in the terms of the contract will help to avoid any misunderstandings when rents or payments are made late. Including a clause that indicates an additional charge for late payments and the date when this starts is suggested for all rental agreements. If one of your payment options is through a check, then you have to add that a check returned for insufficient funds will be charged.

Here’s an example:

Additional Charges. Late fees of __ per day will apply to begin on the __ of each month, if payment is not timely made, or the maximum amount authorized by law.

Any rent payments that are returned for insufficient funds, a “stop payment,” or any other reason, will incur a returned check charge of ___.

Part 4: Payments Due Before Moving In

The more specific you are about when payments are due will help to avoid any misunderstandings between you and your new tenant. Although payments and parts of this clause are already stated throughout the agreement, it’s still important that you spell these out. You may want to add an additional sheet to the rental agreement that has dates and amounts due to all parties to the contract understand their responsibilities and timelines for payments.

Make sure you add the date when the lease was signed and payment schedules were put in place. It is also important to, specify the amount for the first month, the last month’s rent, the amount of the security deposit and other charges.

Here’s an example:

Payments Due. The following payments are due upon the date of signing of this Residential Lease Agreement and before Tenants move into the Property:

First month’s rent (prorated) [PRORATED RENT]

Last month’s rent [LAST RENT]

Security Deposit [SECURITY DEPOSIT]


Part 5: Insurance

To avoid any disputes if a tenant’s personal property is damaged while renting the property it is best to require the new tenants to carry renters insurance or sign off that they are declining this type of coverage. It is common practice to require tenants to provide proof of insurance as this will help in covering the replacement of tenant’s belongings if stolen or damaged while inside the property. Insurance from the tenant can also cover any accident that happens inside the rented unit.

Part 6: Occupants

To avoid any misunderstanding or overpopulation and crowding within the property unit all tenants that will be living at the unit need to be listed, prior to moving into the unit.

In this section, provide the list of names of tenants. If you allow pets on your property, they also include the list of pets. Make sure that you clearly state that the unit is for residential use only. You can also require background and tenant screening for any listed residents of the property.

Here’s an example:

Occupants. The occupants of the Property, and for residential use only, will only be the following:  ____ and the following: ____, ____, and ____.

No pets or other animals are allowed to be kept on the Property except the following: ____, ____, and ____.

Part 7: Responsibilities

Since the rental agreement is a legal document that is often used by the courts to settle disputes, it is best to make sure all responsibilities are detailed in the terms of the agreement.

The following sections will focus on the details regarding the responsibilities of both parties.

Maintenance And Upkeep

Having a detailed maintenance and upkeep clause indicates the tenant’s and landlord’s responsibility of ensuring that the property is well-kept. Having detailed terms for who is responsible will help to avoid disputes in the future in regards to maintenance and upkeep.

Some residential lease agreements often include terms and conditions regarding alterations made on the property in this section, while some prefer to keep them as separate clauses. For the purpose of this residential lease agreement template, we will combine the two in one section.

Maintenance and Repairs. Tenant will keep the Premises, including the grounds, appliances, fixtures and furnishings, in clean, sanitary and good condition and repair. If repairs other than general maintenance are required, the Tenant will notify Landlord. In the event of default by Tenant, Tenant will reimburse Landlord for the costs of any repairs and/or replacements.

Tenant will not make any alteration, addition or improvement to the Premises without first obtaining Landlord’s written consent.


Make sure to reiterate in the clause that the tenants are not permitted to make any copies of the keys and that all keys must be returned to the landlord/property manager once the lease ends. You should also indicate in the terms of the agreement  that a copy of the key is to be kept at the property management office for entry into the rental unit when an emergency dictates or is prior agreed by landlord and tenant.


This clause is where you have to list all the utilities that you will provide to your tenants, and those that must be paid for by them.

Here’s an example:

Utilities. Tenant is responsible for payment of all utility and services for the Premises including electric, gas, telephone, cable television, and water. The following will be paid for by Landlord: trash and sewage.

Quiet Enjoyment

In this section, provide details regarding the tenants being respectful of the neighbors and community where your property is located. Make sure to add a statement about the prohibition of any illegal activities inside the property. Any criminal conduct will be ground for immediate termination.

Part 8: Termination

It is important to include a clause detailing the grounds for termination and the process of doing so. Despite how amicable the tenants may seem at the beginning, it can never be guaranteed that no disagreements will take place. To protect yourself from such circumstances, lay out the possible causes for default and their consequences.

Default and Remedies. In the event of any default under this Agreement, Landlord may provide Tenant notice of default and an opportunity to correct such default. If Tenant fails to correct the default, other than a failure to pay rent, Landlord may terminate this Agreement by giving three (3) days of written notice to Tenant via hand delivery.

If the default is Tenant’s failure to timely pay rent as specified in this Agreement, Landlord may terminate this Agreement by giving three (3) days of written notice to Tenant. After termination of this Agreement, Tenant remains liable for any rent, additional rent, and costs incurred to remedy any damages during the Term.

Part 9: Subletting And Assignment

Because it is a common occurrence, it is crucial to include a clause about subletting the property. This section needs to state whether or not it is allowed and if it is, it must be indicated that a written consent must be given. If allowed then you should also detail requirements for sublet tenant in regards to passing background and tenant screening processes.

Part 10: Rights Of Access

In this section, it must be indicated that the landlord has a right to access the property given that tenants have been notified beforehand. An additional statement must also be included stating that the landlord is allowed to enter without prior notice in the event of an emergency.

Part 11: Additional Provisions And Disclosures

If all the clause mentioned above is not enough, then you can provide an additional clause. This can be used if there are some matters that must be disclosed to tenants and put into writing.

Additional Provisions

If you want to add anything relating to some specific feature of the property, all you need is to add this clause. You can list additional provisions if you want and add in things that are not covered anywhere else in the agreement.

Part 12: Applicable Law

This is where you write which state will govern and interpret the agreement. It is also here that the specific county should be stated if any dispute happens during the agreement.

Here’s an example:

Applicable Law. This Agreement will be interpreted and governed by the laws of the State of ___ and the venue of any dispute over this Agreement will be in the County of ___ in the State of ___.

In the event of a dispute between the parties arising under this Agreement, the parties will make good faith efforts to discuss the dispute in person and attempt to reach a resolution.

Part 13: Final Part Of The Agreement

Once you are happy with all the clauses that have been included, you can now proceed to the final part of the agreement.

Three important details must be present in this section and are similar to the introduction:

  • Date when the lease is signed
  • Details of the landlord (name, address, contact number)
  • Details of the tenant/s (name, address, contact number)

Don’t forget to add a space to each line for you and your tenant’s’ signature to make the agreement legal and binding.

Final Thoughts On Steps In Creating A Basic Template Of A Residential Lease Agreement

In this blog post, we talked about the steps you will need in order to create a basic template for a residential lease agreement.

Repetitive tasks are inevitable for property managers, particularly when prospective tenants are ready to move in the property. Having a basic template for a residential lease agreement prepared can help solve this problem.

The 13 parts mentioned in today’s blog can help you create your own template. Every part mentioned is essential for your residential lease agreement template. Make sure that you follow these steps carefully and add only what is needed in your agreement.

If you have any comments regarding the steps in creating a basic residential lease template, then feel free to drop them below.




Suggested Articles:
1. What You Need To Know About Month To Month Lease Agreement
2. Things To Keep In Mind When Managing A Commercial Space For Lease
3. Important Things To Know About A Commercial Lease Agreement

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Article: How To Create A Basic Residential Lease Agreement Template

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