What’s the difference between a rental agreement and a lease agreement? Both are considered to be a residential lease, both are subject to state renting law, and they both require you to pay rent to a landlord. Aside from that, you have two vastly different contracts that somewhat do the same thing.
Rental Agreements
Depending on your life and residential needs, you might be looking for a rental agreement instead of a lease. A rental agreement allows tenants to rent a residence on a month-to-month basis. This is a great option for people who will only be living in a city for a few months, or just don’t want to commit to a year-long lease.
Unlike a lease agreement, where the terms within the document cannot be changed during the year, the landlord can change anything at the end of the month. Whether it’s raising the rent or allowing pets in the building, the landlord has the freedom to change the rules without formal notice. And although a rental agreement automatically renews itself, a renter can end the agreement at the end of the month with written notice. Here’s an online template that you can use to create your own rental agreement.
Lease Agreements
Most leases last six months or one year, during which the tenant agrees to pay rent and abide by the terms within the agreement. It is illegal for renters or landlords to change aspects of a lease without mutual written consent. In most cases, leases aren’t automatically renewing agreements. Once a lease expires, a tenant has the option of renting on a month-to-month basis or not renewing the agreement. If they choose to stay on the lease, they are renting under the same agreements outlined in the year-long lease. Do you need a lease agreement template? Take a look at this free, online example.
