14 clauses renters should never ignore in lease agreements

Navigating lease agreements can be a daunting task, but understanding key clauses can save renters from potential pitfalls. This article demystifies complex lease terms with valuable insights from legal experts in the field. Readers will be equipped with the essential knowledge to make informed decisions about their rental agreements.

  • Review Insurance Requirements Carefully
  • Avoid Jointly and Severally Liability
  • Understand Usage Restrictions in Lease
  • Scrutinize Default and Termination Clause
  • Check Common Area Maintenance Charges
  • Clarify Relocation and Assignment Clauses
  • Examine Renewal and Termination Conditions
  • Verify Subletting Rights and Rent Increases
  • Understand Security Deposit Terms
  • Clarify Maintenance and Repair Responsibilities
  • Specify Utility Responsibility
  • Detail Repair Responsibilities and Property Sale Terms
  • Know Lease Termination Conditions
  • Outline Liability for Damages and Early Termination

Review Insurance Requirements Carefully

An important aspect that often gets overlooked in lease agreements is the insurance requirements. You might think, “Oh, I’ll just get renter’s insurance,” but it’s not always that simple. Some leases can be very specific about what kind of insurance you need. I’ve come across clauses requiring tenants to have not just any renter’s insurance but to list the landlord as an additional insured.

This means the landlord is covered under your policy, potentially leading to higher premiums for you. Moreover, if your policy doesn’t meet these specific requirements, you could be in breach of your lease. I had a case where a tenant was required to have $300,000 liability coverage, which was much higher than standard policies. They didn’t realize this until after moving in, and it ended up costing them significantly more than they had budgeted for. So, when you’re about to sign that lease, make sure you dive deep into the insurance clause. Understand exactly what coverage is expected of you to avoid any nasty financial surprises.

Gordon Hirsch, Founder and Managing Attorney, Hirsch Law Group

Avoid Jointly and Severally Liability

If you are signing a lease with other people, there are three innocent-looking words that you DON’T want in your lease. These three words are “jointly and severally.” They occur in sentences such as, “As more than one individual joins in the execution of this Lease as ‘Tenant,’ each individual shall be jointly and severally responsible for complying with Tenant’s obligations as set forth in the Lease.”

What “jointly and severally” means is that each individual on the lease is obligated to cover the entire rent and costs of the apartment if other roommates don’t pay. So if you rent an apartment with two other people and they leave or don’t pay the rent, you have already agreed to cover the whole rent yourself, and you are legally obligated to do so.

Julia Rueschemeyer, Attorney, Attorney Julia Rueschemeyer Divorce Mediation

Understand Usage Restrictions in Lease

I can confidently say that one of the most overlooked aspects when signing a lease agreement is the “Usage Restrictions” clause. Many tenants are focused on rent and the basic terms of the lease but often overlook the specifics about how they can actually use the property. This clause can significantly impact how a tenant operates within the space, especially in commercial leases. For instance, if you’re renting a property for a business, the lease might limit the type of business activities you can carry out or restrict changes to the property.

A key clause renters should pay close attention to is any restriction related to the nature of business operations or even the hours of operation. If you’re planning on expanding your business or running an operation that involves noise or frequent foot traffic, you need to ensure the lease allows that. These limitations could be detrimental if you don’t check them beforehand. I always recommend reviewing this clause in detail to avoid potential conflicts or the need to renegotiate later on, as it can affect the long-term success of your business or personal use of the property.

Russ Johnson, CEO & Finance Expert, Linx Legal

Scrutinize Default and Termination Clause

When it comes to signing a lease, the default and termination clause is something you really have to pay attention to. I want to look closer at why this part is important: it lays out what counts as breaking the lease, what penalties you’ll face, and how you or your landlord can end the agreement. It’s a common mistake to skip over this section, not realizing it could be tough or one-sided terms.

Consider this: some leases impose steep fines for small slip-ups, or allow the landlord to evict you with barely any notice. That’s why it’s really important to go over these terms with a fine-tooth comb and discuss any concerns if something seems off or too restrictive. Don’t stop there. Look over clauses about maintaining the property, subletting, and the costs if you need to leave early. These details can really shape your financial and legal responsibilities while renting.

Here’s my simple advice: never sign a lease—or any legal document for that matter—without understanding the full picture. If things get a bit murky, do yourself a favor and bring in a legal expert. Ensuring the lease protects your interests and meets your needs is important. A complete discussion and review before you sign can save you from a ton of legal headaches down the line.

Brian Joslyn, Owner, Joslyn Law Firm

Check Common Area Maintenance Charges

Our clients frequently ask us to review their leases and there is one thing we always focus on first because it is where they “get you.” That is Common Area Maintenance, commonly called CAM. These are charges that a landlord passes on to the tenants for the common areas like hallways, restrooms or even the exterior. Our preference is to not have these or to remove them altogether so that our clients have consistent, dependable rent charges. In many instances, that is a deal breaker.

Alternatively, if the space is very desirable, limitations on what is covered can be a compromise. We did that for one of our own locations, and I was pleased that we did when the landlord tried to charge us for a batch of improvements that had not been negotiated. Checkmate—we got them to back off!

Matthew Davis, Business Lawyer & Firm Owner, Davis Business Law

Clarify Relocation and Assignment Clauses

One often-overlooked legal aspect of lease agreements is how relocation or reassignment of the lease is handled, particularly clauses related to transfer or assignment premiums. These provisions come into play when a tenant needs to assign their lease to another party due to relocation for work, family changes, or other reasons.

Key Clauses to Pay Attention To:

  • Assignment Clauses: Many leases allow assignment (transferring the lease to a new tenant) only with the landlord’s consent. However, landlords may impose conditions, such as requiring an assignment fee or a “transfer premium”—a percentage of the rent or a flat fee paid for the privilege of transferring the lease. Tenants often overlook these terms, only to discover later that assigning the lease could be costly.
  • Relocation Clauses: Some commercial and residential leases include clauses that allow the landlord to relocate the tenant within the property (e.g., moving to another unit or space) under certain conditions. While this is more common in commercial agreements, it can appear in some residential leases. Tenants should ensure such clauses are reasonable and clarify who bears the relocation costs, including moving expenses.

Relocation or assignment clauses can directly impact flexibility and costs when life circumstances change. For example, if you’re offered a job in another state, you might face significant fees or delays while negotiating a lease assignment, especially if the landlord has discretionary control over the process. Knowing these details upfront can help you plan or negotiate better terms before signing the lease.

Matt Odgers, Attorney, Odgers Law Group

Examine Renewal and Termination Conditions

One of the legal aspects that many people overlook when they sign a lease agreement is the fine print regarding renewal terms and termination conditions. Many leases contain an automatic renewal clause that can put tenants into another term without explicit consent unless they provide notice within a certain time frame. Failing to understand this can result in unexpected financial obligations or penalties.

A very important clause renters should pay close attention to is the clause of maintenance and repair responsibilities. This defines who pays for repairs and what constitutes routine maintenance as opposed to damages due to negligence. Understanding this clause can avoid disputes over costs on issues such as plumbing or appliance repairs, making sure both parties are on the same page.

Sonya Shikhman, Criminal Lawyer, Bytensky Shikhman Barristers

Verify Subletting Rights and Rent Increases

Many renters forget to check the specific rules about subletting rights. This detail becomes crucial if your circumstances change during the lease term. Some agreements outright forbid it, leaving you stuck in a tight spot. Understanding these terms ensures flexibility if you ever need to move unexpectedly. It’s one clause that can prevent unnecessary disputes or financial stress.

Always review the clause detailing how and when rent increases happen. Some agreements permit increases mid-lease under specific conditions, which could be problematic. Understanding whether increases are tied to market rates or fixed limits is crucial. Knowing this ensures you won’t be blindsided by unaffordable adjustments later. Transparency here prevents financial strain and keeps the relationship professional.

David E. Preszler, Partner, Preszler Injury Lawyers

Understand Security Deposit Terms

I’ve seen many renters overlook the security deposit terms when signing a lease agreement, and it often leads to confusion or financial loss. The most important clause to pay close attention to is how the landlord handles the return of the deposit. Many leases don’t specify clear conditions under which deductions can be made, leaving tenants at risk of losing part or all of their deposit for reasons that may not be fair. Renters should ensure that the lease includes a detailed list of acceptable damages and how these will be assessed. Furthermore, renters should look for clauses specifying the time frame within which the deposit must be returned, typically within 30 days after moving out.

It’s also crucial to check whether the lease allows the landlord to keep the deposit for any unpaid rent or repair costs, and if so, renters should ask for clarification on what constitutes “reasonable damage.” Finally, I always advise renters to take photos or videos of the property before moving in and after moving out, so they have documentation in case of disputes. By understanding these clauses, renters can avoid unnecessary conflicts and protect their financial interests.

Seth Persily, CEO, Elite Litigators

Clarify Maintenance and Repair Responsibilities

The “maintenance and repair responsibilities” clause. This might seem like a small detail, but it can lead to significant misunderstandings and costs if unclear. Many renters assume landlords will handle all maintenance, only to find themselves responsible for certain repairs once they live in the property.

This clause outlines who is responsible for what—things like fixing appliances, addressing plumbing issues, or even routine upkeep like lawn care. Some landlords might stipulate that renters handle minor repairs or even cover the cost of specific replacements. If this isn’t clear in the lease, it can create disputes or leave you on the hook for unexpected expenses.

Before signing, renters should carefully review this section and ask questions. For example, if the air conditioning breaks down in the middle of a Georgia summer, who’s responsible for fixing it? What about smaller issues, like a leaky faucet or a broken doorknob? These are scenarios that may seem insignificant until they happen, and clarity upfront can save you both time and money.

A key takeaway? Don’t just skim over the lease assuming the landlord will “take care of it.” Knowing your responsibilities—and holding the landlord accountable for theirs—helps ensure a smooth rental experience. Don’t hesitate to negotiate or seek clarification if anything seems unclear or unfair. A lease is more than just a formality; it’s the rulebook for your time in that home.

Justin Landis, Founder, Justin Landis Group

Specify Utility Responsibility

Often overlooked in lease agreements is the utility responsibility clause, which can lead to unexpected financial burdens if not defined accurately. For example, in multi-unit properties without separate utility meters, landlords may split water or energy bills among tenants. Disputes usually arise, however, when one tenant consumes more energy than the others. Leases should specify how utility costs and billing are calculated. Renters should ensure this clause is detailed and compliant with local laws to avoid surprise charges. Having this clarity prevents disputes and ensures an equitable allocation of costs.

Mitchell G. David, Founder, Beach Life Premier Team

Detail Repair Responsibilities and Property Sale Terms

I noticed lease agreements often lack clarity on who is responsible for specific repairs, like HVAC maintenance or pest control. Renters should ensure the lease explicitly states which party covers these costs, avoiding unexpected expenses. I recommend requesting a detailed breakdown of responsibilities and costs before signing to avoid any confusion or disputes in the future. According to landlord-tenant laws, landlords are generally responsible for major repairs while renters are responsible for minor ones.

I recommend paying close attention to the clause about what happens if the landlord sells the property. This clause can have a significant impact on renters, as it may allow the new owner to terminate the lease or change the terms. Make sure to negotiate for a provision that allows you to stay until the end of the lease or receive compensation if you are forced to move out due to a change in ownership. This can protect renters from sudden and unexpected changes that disrupt their living arrangements.

Luca Steinmetz, Founder & CEO, FarAwayHome

Know Lease Termination Conditions

Aspect of the lease, which very few people consider when signing, is the clause that pertains to termination. Many renters simply assume that breaking a lease early or at the end of the term is a cut-and-dry issue; the lease contains conditions, fees, or notice periods that must be met. Knowing this can help save a great deal of money and headaches should one find themselves in unexpected circumstances. I always advise taking a close look at this section with your landlord or a lawyer to avoid surprises.

One of the important clauses renters should pay close attention to is that of maintenance and repairs. It’s very important to know who is responsible for repairs, especially when it involves major appliances or structural issues. Sometimes, landlords insert phrases that would make a renter responsible for surprising things, which could later turn out to be expensive. I always advise renters to make these points clear and get everything in writing to protect themselves during their tenancy.

Jonathan Ayala, Licensed Real Estate Salesperson | Founder, Hudson Condos

Outline Liability for Damages and Early Termination

As a landlord, it’s crucial to clearly outline liability for damages in the lease. Tenants often overlook their responsibility for any damage beyond normal wear and tear. Whether it’s a broken appliance or stained carpet, having this spelled out prevents misunderstandings when it’s time to move out.

The early termination clause is equally important. If a tenant needs to leave early, you want to protect yourself from lost rent. Make sure the lease defines any penalties or required notice periods. This ensures both you and your tenant know what to expect and reduces risk for everyone.

Don Wede, CEO, Heartland Funding Inc.

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