What is a lease and what does it mean to me, the student?

The Housing Resource Center provides this information to help students understand the parts,… The Housing Resource Center provides this information to help students understand the parts, meaning and implications of apartment leases used by area landlords. An attorney did not prepare this information, and you should not consider it legal advice. The information and opinions presented are those of the staff of HRC, who are solely responsible for any errors or omissions. Any questions about your legal rights as a tenant or possible legal action should be discussed with an attorney.

Leases Are Contracts

Leases spell out the relationship and requirements for both the tenant and landlord. Because the landlord chooses what the lease will say, it usually favors the landlord. If the tenant disagrees with some part of the lease, it should be discussed and may be modified or deleted by mutual agreement. Any change, addition or deletion to the contract should be initialed by both the landlord and the tenant(s). Nothing said or agreed to orally will change any part of the lease unless it is in writing and signed by both parties. The court will use only the written lease to decide any legal action brought before it. If you do not agree to the terms of the entire document, do not sign it. Your signature will bind you to fulfill the terms of the agreement exactly as it is written and/or pay significant financial penalties. There are no timeouts, second chances or fresh starts. Landlords will use the courts or threat of legal action to enforce the lease, and tenants should be equally prepared to exercise their rights under the contract and through the courts if necessary. Everyone who signs the lease should receive a copy, with signatures, to serve as a record of the lease and each party’s responsibilities under the terms of the lease.

A lease is a contract between you and the landlord. It describes a legal agreement in which you are given possession of an apartment, owned by the landlord, in which to live for a specific length of time. The lease also specifies what you are to do (and not do) in order to receive or retain possession of the apartment.

Contracts can be long or short, simple or complex. Contracts can be oral, but normally are in writing in order to be enforced. Enforcing a contract generally means asking a court for a judgment that would force one or both parties to do – or not do – what the contract specifies. Legal actions to enforce a lease are usually brought to the district magistrate but could be brought to another court, depending upon what is being charged or what relief is being sought.

Signatures

Leases must be signed by both parties. They do not have to be witnessed, although landlords may choose to have a staff member formally witness the signature. In Pennsylvania, you must be older than 18 to legally sign a contract. If you are younger than 18, the landlord may require a co-signer, such as your parent, who will accept legal responsibility for the obligations of the lease for/with you. In the University area, many landlords will request/require a parent to co-sign even if you are older than 18. This is an acceptable business practice, although it may annoy the student. Since students generally have limited personal assets, the landlord will be able to take legal action against the co-signer in case the student breaches/defaults on the lease. Legal action for breaching a lease can be taken across state lines.

Identify the Property

Leases should identify the property to be rented. Identification should include the street address and apartment number. Students should inspect the specific apartment they are renting before they sign the lease. If, when you are ready to move in, the apartment you leased is not ready for occupancy, you may agree to take a different unit. However, you are not obligated to accept any apartment other than the one identified in the lease. Of course, if the station wagon is parked outside, and classes begin on Monday, you will be under significant pressure to accept an alternate apartment from the landlord, who may be apologetic and accommodating.

Alternately, the apartment you rented might be trashed from the last occupants, and the landlord won’t be able to clean it before you are supposed to move in. You can accept an alternate, wait in a hotel until your apartment is ready or move into the mess. If you do move in, take pictures or video the damages and deficiencies, fill out a thorough inspection report for the landlord with a list of repairs and cleaning that needs to be done, and remind the landlord regularly of the work remaining to be completed until the apartment is fully ready for occupancy. While most landlords take pride in the appearance and standards of their apartments, some make a habit of procrastinating and then cleaning or fixing just enough, knowing that many students will eventually give up on a leaking toilet, dirty refrigerator or torn carpet.

Length of the Lease

Leases should indicate the starting date and ending date of occupancy. Most leases in the University area are for 12 months. In some cases, the lease may be open-ended or month-to-month. Leases of six, nine and 10 months are occasionally found in this area, but are unusual.

Many leases are pre-printed or published forms on which the landlord fills in the blanks before both parties sign. The publishing company or professional association providing the forms will be printed on the bottom of the page. Pre-printed forms usually contain the basic legal elements of a good lease, and newer ones are written in plain language, a requirement in Pennsylvania.

Rules and Regulations

Watch for rules and regulations that may be included in the lease or attached as an additional document. These may be regulations about noise, cleaning requirements and standards, garbage storage and disposal, security issues, smoke detectors, parties, guests, pets, parking, hallways, lights, landlord access to inspect or show the apartment to prospective tenants and other lifestyle issues. Rules and regulations are often a problem between landlord and tenant if they are not understood, agreed to and followed. Tenants can be evicted for breaching the lease by not following these rules. Rules and regulations can be changed, added to or amended by the landlord during the lease, without tenant approval, if the lease allows it.

Security Deposits

Security deposits are customary in the University community. They are usually equal to one or two months’ rent. They cannot be greater than two months’ rent. Most leases specify that the deposit cannot be used as the last month’s rent. Some leases say that if the landlord uses some or all of the security deposit during the term of the lease, the tenant must pay to bring the deposit up to the lease-specified amount. The landlord must place the security deposit in an escrow account in a bank for the term of the lease, or may be bonded, which is a guarantee of payment. The tenant does not receive any interest payments from the escrow deposit for the first or second year. On longer leases, interest must be paid after the second year.

Payment of Rent

Payments of rent, also called consideration, are specified in the lease. Payment information will include the monthly rent amount, the total amount of the rent to be paid over the term of the lease (usually 12 times the monthly rent), when (date due) and where (office address) the rent is to be paid, how the rent is to be paid (mail, in person, check, money order, etc.) and a late date after which the payment is not on time and violates the lease terms. Some landlords allow a discount for timely payment. (e.g. rent is $500 a month, but if paid before the fifth of the month, a discount of $50 will be allowed – therefore, the rent due is $450.) Other landlords assess a penalty if the rent is late (e.g., rent is $500 a month, but if paid after the fifth of the month, a penalty of $50 will be charged – therefore, the rent due will be $550). Both ways are acceptable; however, the total amount of the contract, which is usually stated in the lease, will be changed depending on whether it is discounted or penalized. If discounted, the total contract amount will not reflect the discount but will be the full/larger amount. In event of a lawsuit by the landlord, the landlord would request payment in full for the entire lease term, which would be the larger amount.

Utilities and Appliances

Utilities and appliances are also described in the lease, and these details should be read carefully. Who pays which utilities should be specifically indicated. If the tenant is responsible for certain utilities, they must contract directly with the utility company. Utilities provided by the landlord should be listed. Utilities include electricity, water and sewage and may include gas and garbage removal. Be cautious about agreeing to pay the landlord for utility services based upon the landlord’s contract with the utility company. While not illegal, it is a situation that could tempt an unscrupulous landlord to inflate charges, double-bill tenants or charge tenants for services the tenants did not use. Utility companies will provide estimates of service charges for tenants if requested and will perform usage audits for customers who wish to verify charges. Usually, a refrigerator and stove are included if the rental unit has a kitchen, and should be referenced in the lease. Other appliances are not usually provided. A dishwasher, garbage disposal or window air conditioner would be listed if included.

Use and Occupancy

Many leases will include a use and occupancy section that indicates the use of the apartment is limited to residential and dictates the number of people who may live there. This means it cannot be used for business, nor to house more persons than stated in the lease. Children in a family are counted, as are unrelated adults. Guests may also be restricted by language in this section or in rules and regulations. The allowance of overnight guests or visitors, the maximum number of nights they can stay and if they can be given a key to the apartment are common limits on the tenant’s use of the apartment.

Sublets and Assignments

Sublets and assignments will permit, prohibit or define the landlord’s policy on subletting or assigning the lease to another person. If the lease does not prohibit it, state law permits subletting. Watch for the need for written permission by the landlord to sublet or assign, and/or additional fees or penalties that will be charged for subletting. If you do not plan to remain in Pittsburgh or to attend the University during the summer, subletting is a reasonable alternative to paying for an apartment you aren’t using. Guest and visitor policies might prohibit allowing someone to use your apartment for the summer without the landlord’s knowledge or permission.

Acceleration of Rent

The landlord may have the option of an acceleration of rent if the tenant fails to pay rent on time or breaches/violates other lease terms. This means the landlord can demand the entire amount of the lease consideration be paid within 30 days. This is usually a last resort for the landlord who isn’t receiving the rent in regular, timely or complete payments, although it could be sought for other violations of the lease. Unless the tenant agrees and pays the amount specified in the lease on time, the landlord will go to court to receive a judgment ordering the payment. A clause in the lease will usually specify the availability of that option for the landlord.

Waiver of Notices

Some leases now include a waiver of notices. Normally, notice will be given to the tenant prior to the termination date of the lease. Waiving this notice has little impact on the tenant, who should be aware of the end of the lease and the need to renew or move out. Tenants should be aware of any penalties for failing to move out by the end date of the lease. Often, high daily rates or an entire month’s rent are specified for holdovers.

Waiver of another notice normally required of the landlord could be more damaging to the tenant. If a landlord initiates legal action to force a tenant to pay outstanding rent payments or to leave the property, the law requires the landlord to give written notice of the action to the tenant. This notice allows the tenant time to correct the problem or negotiate with the landlord. By waiving the right of notice, the tenant will be deprived of the opportunities to correct the problem and the landlord will immediately file legal action.

Confession of Judgment

Some leases may contain a confession of judgment clause, which is a liability for the tenant and which, when combined with a waiver of notice, is legally terminal. In a confession of judgment, the tenant agrees, by signing the lease, to allow any attorney, including the landlord’s attorney, to represent him and to confess judgment or essentially “plead guilty” for the tenant. Having pled guilty, the tenant will be responsible for whatever judgment is handed down. Confession of judgment is a very serious and controversial remedy that appears to be at odds with the American concept of due process. As a result, confession of judgment clauses require specific wording, information and acknowledgment in the lease to make them enforceable. This might be the only grounds for appeal for a tenant who suddenly is ordered to leave the premises, pay the entire cost of the lease, or both, as well as court costs and attorney’s fees.

Right of Entry

Many landlords in the University area will specify a right of entry in the lease. Usually this means that the landlord can enter the apartment, without notice and whether or not the tenant is present, in order to fix something that the tenant has requested, to respond to an emergency or to show the apartment to prospective tenants. Any limits on the time of day, purpose or notice will be specified here. Leases that allow landlord access for any reason and at any time of the day or night should be questioned. Failure to allow the landlord access could be grounds for the landlord to take legal action if the lease specifies access. Tenants are entitled to the right of quiet possession, but elements of that right can be abridged by lease.

Renewal

Renewal is the term for extending the current lease agreement for another period of time. Usually, a one-year lease renews for another year and a six-months lease for another six months, although some leases will renew on a month-to-month basis after the initial lease term. In the University area, many landlords now require the tenant to renew their lease as much as five months or 150 days before the end of the lease. This permits them to advertise vacancies for the next academic year prior to the end of the spring term. This is a good move for the landlord, but it could be awkward for the student who isn’t sure about staying in the apartment another year or even returning to school the next year. A very early renewal deadline also means that the spring term can be a series of landlord visits with prospective renters touring your humble abode. While not generally as picky about neatness as mom, visitors checking out your closet and bathroom can quickly become an ordeal.