My dad owned a mixed used property, that's years ago, and he hired an attorney, the nephew of one of his neighbors, to the draft his leases and handle the renewals. They are commercial leases. We're located in NYC.
I invested mostly in the NYC areas, and the "Real Estate Board of New York" sells leases and addendums. I used to buy and 2 year supply. The forms are preprinted and I had to manually fill in. The advantage here is the leases conform to local laws.
In recent years, creation of leases has gone online. I started using lease forms via "ezLandlordforms.com". They claim their leases are customized for most jurisdictions, in all 50 states. You create the lease online, archive it online, and retrieve at renewal time. They even offer renewal reminders via email.
I found the REBNY on line lease creation a little clunky when I checked a few years ago after they switch over to online.
Up till a few years ago, I have "addendums" that I kept on my computer that is specific to particular rental units. That's because of the peculiarity of each unit. For instance, I write down appliances I supply and whether tenants handle it's repairs. Other rentals with common areas, I specify they cannot leave their personal belongings there. But in "ezLandlordforms.com" I fill these things in during online lease creation, so the custom addendums are not as relevant. For a while, while using the online forms, I still used my addendum. I no longer, as the online lease with it's addendums runs some 50 pages, and quite comprehensive. It's so long because a small 2 line clause in my custom addendum, they take a page to do, enumerating the reasons.
So for now, it's eLandlordforms.com" for me. You can check it out and they even offer some of their forms for free.
@Kristen Ray I have never written a lease anywhere other than Connecticut, but we used the standard board of realtors lease combined with our own lease addendum to comprise our lease documents. The addendum is basically with with things we have seen over the years can become issues if not addressed in the lease specifically while the board of realtor lease covers all of the standard parts you find in every lease.
Along with the lease documents be sure to account for any state specific addendums renters need to be provided, for instance here in CT a lead based paint addendum and informational pamphlet is required to be given to the renter if the home they are living in was built prior to 1978.
There should be plenty of various leases found on line. Once you have studied and understand your state landlord tenant regulations you can confirm there are no conflicts between the lease and regulations that would void the lease. You add any additional lease language to comply with your state regulations.
It is imperative that you learn your state regulations in advance of beginning your business to insure you are operating within the law.
Knowing the regulations governing your business is mandatory.
@Kristen Ray . I would highly suggest creating something more customized than the standard templates so that you are addressing some of the peculiarities you mention. A few years back a few of us in North Central CT got together for a few meals to go over some lease templates and customized leases that we have acquired over the years, and basically took what we liked from each, made some slight modifications, then allowed for some space to modify for each lease. We had this vision of creating a "bullet-proof" lease (which, as we all know is impossible with all the laws and rules regarding landlord/tenant state laws). The thought was for us to ensure that we covered our interests, all the while knowing that we should have an attorney proof it at the end to ensure it is enforceable with the language we opted to use. Using an attorney makes a lot of sense as well if you decide to go this route, but I wouldn't hire an attorney to create the lease for you (those are some heavy billing hours) Go to some local meet-ups where you can create a small group of people just like you, that have similar goals of creating a lease. The more minds discussing, the easier it is to talk through each section and offer insight from a different perspective.
Originally posted by @Kristen Ray :
We are new to REI. We are wondering how you develop your lease? Is there a template you use? Does your lawyer develop the lease?
Kristen, I suggest doing what @Rick Santasiere did (I'm biased as I was one of the landlord's in Rick's group). All jokes aside target the grey-haired investors...they have probably forgotten more [horror] stories regarding tenants doing this, that and the other thing than either of us would care to experience!
This is an area where you should turn to expertise and experience so that you can protect your own A$$ets. Paying an attorney (if you don't have any friends in that world) to review the lease is money well spent. I recommend @Edward Schenkel if you need one.