7 Clauses Every Pennsylvania Landlord Should Include In Their Lease

I have had many clients that are landlords over the years and have witnessed them make the same mistakes that could have easily have been avoided. Therefore I created the following list so you can avoid these mistakes. Carefully screen all prospective tenants thoroughly which means have them fill in a rental application and pay a nonrefundable application fee. You can download or print a rental application from our website resource page at no charge. Use the nonrefundable application fee to order criminal background checks and credit reports. If the credit score is under 620 and the tenant can explain why it is under 620 such as a divorce, you can request that they get someone with a higher credit score to cosign the lease for the first two years. Contact the tenant’s current employer for the last 5 years to verify their work history and salary. Once you have thoroughly screened the prospective tenant you need a good lease to protect yourself.

A great lease should contain the following 7 Clauses:

1. Waive the notice to quit time requirements;
2. Require 90 days notice to terminate the lease;
3. Contain Act 215 language allowing the landlord to garnish the tenants wages up to 10% of his gross pay;
4. Have an abandoned property clause so the landlord does not have to pay storage fees when a tenant leaves abandoned property;
5. Require tenants to have renters insurance and name the Landlord as the loss payee;
6. If litigation ensues have a clause requiring the losing party to pay the winning parties legal fees;
7. Get an adequate security deposit of at least one month’s rent and get additional deposits for pets or additional tenants.

In addition to having a good lease if the rental property is in your individual name you should purchase personal umbrella insurance to protect your other assets. If you own more than one rental property you should make the appropriate tax election to treat all of all rental property activity as a single rental real estate activity to meet the active participation requirements of the passive activity loss rules. The Law Offices of Spadea & Associates, LLC would be happy to help you make the proper tax elections and provide you with a great lease so you can avoid costly mistakes. Call Gregory J. Spadea at 610-521-0604 from the Law Offices of Spadea & Associates, LLC in Ridley Park.