Lease Flashcards
Lease
Leases are a non freehold interest in real estate
interest = your “claim” to real estate
possession & use
What are leases?
Written conveyamce of possession and use of real estate for some period of time
period of time = “for years”
Privity of Estate
Legal relationship between two parties interested
Essentials of a Lease
- Sufficient description of property (address)
- Rental amount (how much/when payment is made)
- Terms of Lease (dates)
-Intention to Rent (mary tends to rent to joe)
Parties in a lease:
Lessor: Landlord
Lessee: Tenant
Leases longer than 7 years must be recorded in MA
Leases cant last more than 99 years
Lessor is liable for and insures common areas
(entry lobby, common laundry, parking lot)
Lessee is liable for and insures leased premises
(rental unit)
Commercial Leases:
Useable Square Footage:
Spcae that the lessee can occupy and is responsible for
Commercial lease:
Retable Square footage:
Both the leased premises and a percentage of the common areas used by the lessee, but maintained by the lessor
% = common area factor, load factor, common area load
Lessor retains revisionary interest under the lease
*tenants who stay past their lease are tenants at sufferance
Leases run with the land
Certificate of no defense/Estoppel Certificate
used to confirm the lease when the property is sold
Why does the Doctrine of Estoppel exist?
Goal: prevent tenant from trying to renegotiate or defraud new property owner
Sublet
transfer a portion of ones interest in a property to a 3rd party
original lessee is responsible
Assign
transfer all remaining interest to a 3rd party
original lessee is liable
Novate
cancellation of the lease, 3rd party signs a new lease with the lessor
original lessee not liable
new lessee has a lease with a lessor
Lease Termination 1
-
Performance- lease automatically terminates at end of term
-Surrender- cancellation of leaseprior ot expiration - Action of Law- eminent domain taking, tax sale, bankruptcy
Lease Termination 2
- Destruction- property is destroyed
- Foreclosure- Banks have right to cancel the lease
Actual Eviction
Lease has been breached by the tenant
For Non Payment of Rent, Next Stepts for Lessor:
- 14 day notice to quit in writing
- unlawful detainer complaint
- Housing court - hearing held
- Eviction
*must use constable to remove tenant and their things from property
Constructive Eviction
- Permits Lessee to vacate premises and ends obligation to pay rent due to lessor’s violation of the Covenant of Quiet Enjoyment
Covenant of Quiet Enjoyment:
- undisturbed enjoyment of leased property
- property is maintained up to sanitary and build codes
- lessor doesn’t lease to others
- lessor doesnt trespass
- services promised in the lease are provided
landlord has right to reasonable notice to make repairs/inspect property
30 days before tenancy ends
Lessor can only collect
- First months rent
- Last months rent
- Security deposit of maximum of 1 month’s rent (must deposit in escrow)
- Reasonable lock and key fee
If a security deposit is collected, lease must include:
*Statement of Condition Form(tenant returns within 15 days of lease start)
Security Deposit Receipt(form)
Notice of where security deposit is being held (form)
^Receipt of Funds Form
Lessor must pay lessee 5% interest on security deposit and last moths rent each year
Lessor must provide housing that is fit and suitable for occupancy per sanitary codes
- units should be inspected prior or occupancy
- delead all unts where tenants are under age 6
- Provide kitchen with a sink
- keep unit pest free
- maintain buildng up to reuqirements
- keep exits free from obsticles
