As a new landlord, you have to decide on which type of rentals you want to offer, and of course, which types of rental agreements you need. While any real estate lawyer or Bothell property management company can help you with this, it’s best to go into anything well informed. For that reason, the following includes the varying types of rental agreements that you can use in Bothell.
Fixed Term
The Fixed Term rental or lease agreement is typically only used for long-term rentals but can be used with nearly any time frame. The fixed term lease specifies that the tenant receive the unit for a specified amount of time, after which they may renegotiate or loose the lease. These types of leases typically cover 1-4 years and are most commonly used with commercial property management, where it is more convenient for the storeowner to ensure that they cannot be evicted. Fixed term leases are great for a number of reasons, including that they allow the landlord to have a guaranteed tenancy for a certain amount of time. Typically, fixed-term leases turn into at-will leases or contracts at the end of the fixed term period. Depending on the tenant and the landlord, the fixed term lease can extend until a certain date, or until a certain event. In either case, it is important to firmly note the terms in the tenancy agreement. It is illegal to terminate this sort of agreement until the end of the lease period. Some landlords prefer fixed term agreements over other forms of agreements because they are more certain. One common example is asking a tenant to sign a contract to a minimum of one year, after which the contract reverts to a periodic at-will contract.
Periodic
Periodic tenancies are the most common type of rental agreement for living units such as single-family homes, multi-family homes, and apartments. These rental agreements allow the tenant to pay for and rent the unit on a periodic basis. While ‘periods’ can include day-by-day (such as with a hotel), week-by-week, month-by-month, and year-by-year, monthly is the most common form of this agreement. This sort of tenancy allows the tenant to pay according to the period agreed upon without having to pay for a certain amount of time. In this case, either the tenant or the landlord can cancel the lease, typically with a 20-60 day notification depending on the reason. If rent is not paid, tenants typically get a 3 day notice, with 10 days to pay, and can then be taken to court for a legal eviction. However, other than that, tenant and landlord are both required to give fair notice and reason for eviction or leaving.
At-Will
An at will tenancy is one in which the tenant or the landlord can request that the tenant leave at any time. Many fixed-term leases revert to at-will contracts after the end of the agreed upon term, but some people also choose to let out at-will houses and units for other reasons. The benefits of this type of contract are that it is easy to evict the tenant, although the tenant can leave just as easily. This form of rental contract is ideal for units that are up for demolition, units that are up for sale, or for tenants who are looking to purchase a home rather than continue to rent. In either case, this is the rarest form of rental contract because it offers very little security to either the landlord or the tenant.
A rental agreement is legally required should any problems with the lease arise, so it is important to have one drawn up and signed before giving the tenant the keys. While anyone can enter into a rental agreement, any ‘lease’ or periodic rental must be written down and notarized if it is for longer than one year according to Washington law (RCW 59.18). You can also choose to have a real estate lawyer, or a professional Bothell property manager draw the agreement up for you, although which you choose should depend on whether or not you already need a property manager.