What is a Lease Agreement in Real Estate?
Leases are an important part of the real estate world. Whether you're a tenant or a landlord, it's crucial to understand what a lease agreement entails. A lease agreement is a contract between a landlord and tenant that outlines the terms of the rental arrangement.
The lease should include information such as the length of the rental period, how much rent is due, when it's due, and what utilities are included in the rent price. The lease also spells out the rights and responsibilities of both the tenant and the landlord.
It's important to note that a lease is a form of an incorporeal right. This means that the agreement exists even if there isn't a physical document outlining the terms. In other words, even if you don't have a written lease, you still have a legal agreement with the landlord.
Verbal leases are just as binding as written leases, so it's important to be clear about the terms of the agreement. Be sure to study these topics so you are prepared for your real estate exam.
Consequences For Breaking A Lease Agreement
There are a few consequences someone may face if they break their lease agreement. First and foremost, they may be required to pay the remainder of the lease in full.
For example, if they have a year-long lease and move out after six months, they may be responsible for paying the remaining six months of rent. Additionally, they may be required to pay any legal fees associated with breaking the lease.
They may also damage their credit score if the lease agreement is broken. This can make it difficult to rent another property in the future.
What Are Protected Groups?
The Fair Housing Act is a federal law that protects certain groups of people from discrimination when they're looking for housing. These groups are known as protected classes.
The seven protected classes under the Fair Housing Act are race, color, religion, national origin, sex, familial status, and disability. This means that landlords cannot discriminate against potential tenants based on any of these characteristics.
For example, a landlord cannot refuse to rent to someone because they are of a certain race or religion. Knowing what groups are protected by law under the fair housing act is important to know for your exams.
Types Of Lease Agreements
- Commercial lease: Commercial properties for example office buildings.
- Condominium lease: Residential building that shares amenities.
- Family member lease: Rental agreement between family members.
- Farm lease: Agricultural land that is leased for farming purposes.
- Fixed-term lease: A set amount of time, typically 12 months.
- Graduated lease: Lease payments increase at specified intervals during the term of the lease.
- Sublease: Tenant leases all or part of the property to another person. There are many different types of lease agreements to know for your exams. Be sure to study each one so you're prepared.
Lease agreements are an important part of the real estate world. They outline the terms of the rental agreement and spell out the rights and responsibilities of both the tenant and the landlord.
It's important to note that a lease is a form of an incorporeal right, which means that the agreement exists even if there isn't a physical document outlining the terms.
Consequences for breaking a lease agreement can include having to pay the remainder of the lease in full, legal fees, and damage to your credit score.
Finally, under the Fair Housing Act, landlords cannot discriminate against potential tenants based on any of the seven protected characteristics.
Be sure to study all of these topics before you take your real estate exam.
If you want to see some examples of questions that will be on the actual real estate exam, check out our free real estate practice exam. We have been named as the best real estate exam practice for 7 years in a row!
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