By Tony Seruga, Yolanda Seruga And Yolanda Bishop
Whether you are a tenant or a landlord, it is essential that you understand the lease process. There are many times that landlords and tenants are unfamiliar with the process, and to their surprise some unpleasant things they are not familiar with pop up along the way. It is important that this process is understood by both parties or one or the other may end up with the bad end of the deal.One of the most important things for tenants to remember is that they should never sign a Standard Form Lease. This type of lease is actually developed for landlords, and if you sign it as is, you may find yourself on the bad end of the deal. Be sure that you look over the lease and request some adjustments so the lease becomes something that will be beneficial to both you and the landlord. A lease is not intended to favor one party, but is actually intended to be an agreement that will work out well for both parties.
Leasing a House
If you are planning on leasing a house, there is a process that you will need to go through, whether you are the tenant or the landlord. First of all after the tenant finds a home they are interested in leasing, they will want to take a tour of the property and the interior of the home. After the tour they may decide that the house does not fit their needs, or they may decide that the house is wonderful. Next the tenant will have to submit an application for the home.
In some cases, a landlord may have someone like a real estate agent handling these details, but they will be able to see the initial application themselves. The application will ask about work, rental, and criminal history, and only after the application process is satisfactorily completed can the tenant go on to put down a deposit on the home. After the deposit is placed, then a lease is drawn up between the tenant and the landlord, and once the lease is signed, then the tenant can start living in and using the house that they have leased. The process of leasing a condominium is very much like the process of leasing a house as well.
Leasing Commercial Property
If you want to lease commercial property such as a warehouse, office building, or office park, although some of the process will be the same, the process does have a few differences. For the tenant, they will want to take a good look at their specific needs before they begin the leasing process on any one place. Tenants need to be sure that they look around and find out what the market is like, the amount of room that they really need, and the average going prices for the type of real estate they intend to lease. Once you know what you want, then you can start looking at specific properties.
More than likely, you will be dealing with a real estate broker when you try to lease commercial property. Once you know what you want to lease, then you can go on and start touring some prospective properties. If you view a few different buildings, then you may want to have someone take notes on what you think of them so you can later look at them as you compare the buildings you have seen. If the prospective tenant is interested in a specific building, he or she will then draw up a Request for Proposal, which will basically address any issues or concerns that they may have with the building. The landlord will probably have a Standard Form Lease Document as well, which is basically the same type of document from the landlord’s point of view.
It is extremely important for both the tenant and the landlord that all of the concerns on the Request for Proposal are dealt with before the process goes any further. Dealing with any issues in the beginning can help prevent having problems crop up later when you are going through the negotiation stage. While the terms that are on a Request for Proposal are not legally binding, more than likely they are a precursor to the terms that will later be used in the negotiation stage.
Before any final papers are drawn up, the landlord will probably want to do a background check on the prospective tenant. Things like credit, past rental history, and criminal background are things that a landlord should look into. The tenant may also want to check into the background of the landlord as well. Tenants should make sure that the landlord has an excellent rental history so they can prevent having any problems themselves.
Once things hit the negotiation stage, the terms and price can be negotiated until a final lease agreement is drawn up. More than likely both the tenant and the landlord will want to have the final paperwork looked over by a good real estate lawyer to make sure that the terms are reasonable and will not hurt them at a later date. Once both parties are comfortable that the lease is what they want, the money can change hands and the lease can be signed
Whether you are planning on leasing a house, condo, warehouse, or an office park, the lease process is very similar for all. One of the most important things that you need to remember while you are going through this process is that you want to make sure that you have chosen the right place to lease, and you also want to make sure that you get a fair deal as well.
About the Author: Tony Seruga, Yolanda Seruga and Yolanda Bishop of
specialize in commercial and investment real estate. As of May, 2006, they and their partners are managing over $600 million dollars worth of new projects.