Getting started (In this article L. = Landlord; T. = Tenant).
If the prospective T has viewed the premises and agreed to rent, there follows a set of mutual rules, requirements and regulations. If the parties were introduced by a broker, a commission is paid, usually by the T and it is normally the equivalent of one month's rent. In New Jersey an owner-occupied house with less than four units might be exempt from some of these rules. Some rules are enforced by the state, some by the local government and some can be enforced by the L.
What a Landlord can and cannot do prior to renting.
L. can check prospective T's credit rating, confirm their job, their prior rent history, and their criminal history. The L. cannot refuse to rent to T. because of nature of their work, (as long as it is not illegal), race, national origin, creed, gender, sexual orienattion, age, or having minor children (unless the apartment belongs to a retirement community). It is recommended that both L and T walk through premises before taking posession and before vacating. A photo record is recommended so both have a clear picture of what damage existed prior to renting and could not have been caused by the T. No realtor and/or L can secure a list of Megan Law violators in the neighborhood (sex offenders). Only the local prosecutor can do that.
A lease can be oral or written.It can be month to month or annual. A written lease is recommended.
Terms of the lease: who will there, for how long, annual rent, (12 equal payments), when rent is due, grace period if any, when late fee is incurred, who pays heat, who pays utilities, amount of security deposit. In NJ utility bills are in the name of the L and T. T should pay them if that is a lease obligation, but utility can demand payment from L if T defaults.In most leases, late fees and utility payments are considered "additional rent" which means eviction can follow for failure to pay them. Other documents which are part of the Lease: Lead Paint Certificate, a rider which may permit pets and also which adds on a pet fee. A lease can assign parking spot(s) and charge a fee for their use. L can raise rent every year; some municipalities have regulations limiting the
percentage of the increase. These rules do not apply to all T's. NJ has special protection for senior T's.
L can require a deposit at renting.It can be 1 month rent, or 1.5 month's rent. The money is to be deposited in an interest- bearing account and the T should receive in writing where it is and the account number. Failure to do this can subject L to lawsuit for 2 x amount (see below). Each year the L can require an add -on deposit to make the deposit equal to the new current rent.The deposit is for protection against damages by the tenant to the property; it is NOT intended to be used for missing rent,but both parties can agree to this when the T is vacating. When T vacates, the L can inspect for damage and assess the cost of repair and/or replacement. This charge is expected to be reasonable. After one month the L should provide the T with an accounting:principal + earned interest - cost of damages and pay the balance. The T is supposed to provide the L with an address so the refund can be sent to T. Failure to pay subjects the L to a lawsuit for 2x the amount of the deposit
The L should be registered at the local municipal clerk's office. In most towns, there should be a certificate of occupancy which means there are working smoke alarms, carbon monoxide detectors. The L should make sure the premises are habitable and is responsible for maintaining common areas. Multiple units require L to post a document showing ownership, contact person and heating service. A lease may require the T do some maintenance. The T is responsible for the upkeep of the apartment, making sure both L and T have the same keys for access. The T cannot disable the detectors. T cannot change locks. T needs permission from L to add fixtures. Any fixtures added belong to the L, NOT the T. Having a pet when not permitted is a Lease violation. Either party can be responsible for snow removal, but in larger homes this is considered a common area paid for by the L. The same is true of yard work. L is responsible for heat during cold weather unless the Lease makes T responsible
Reasonable rules and regulations
L can enforce reasonable rules and regulation: keeping premises neat, removing garbage, protection against pests, avoiding loud noise, barring subletting or multiple tenants not listed on the lease, avoiding disturbances after normal hours (usually at 11p.m.). T can be forced to pay for damages caused by the T. Usually L is responsible for major repairs; T for minor ones;most time the Lease states what amount is the ceiling for "minor repairs." The L is expected to have liability and fire insurance. These policies do not cover damage to the T's property and the Lease may require the T to purchase T insurance.
Improper or Criminal Behavior
L can evict a T who is engaged in unlawful activity, controlled substance abuse, prostitution, assault, intentional arson. the wilful destruction of L's or other T's property.
The T can leave at the conclusion of the lease. The T can leave before or after the conclusion, but if they do not have L's permission, they may be subject to a suit for additional rent. If the property is owned by a divorcing couple, or an owner in foreclosure, or an owner in Bankruptcy, that in itself does not end the Lease for the T. If the T is uncertain who to pay the rent to in these circumstances, the T should pay into a rent escrow account until the matter is sorted out. Wait for a court order before paying. If the owner sells, that does not mean the end of the Lease. If the new owner wants to use the rented apartment for personal use, the T may be subject to eviction, but if the L does not really do this, the L is subject to a lawsuit for eviction based on fraud and misrepresentation followed by sanctions and fines.
This guide is a review of common rules and regulations for residential L.'s and T.'s. Many of these protections do not exist for commercial renters. NJ considers commercial renting a merchant to merchant contract between "equal" business parties. It considers residential T's in need to protection. In certain cases the court will provide a legal aide attorney for a T being evicted. This is not available for commercial T.'s.
Additional resources provided by the author
See my legal guide on landlord/tenant litigation in general and in NJ. See my legal guide on commercial litigation.