What to Include in a Rental Agreement

Key Takeaways

• A comprehensive rental agreement establishes clear expectations and legal protections for both landlords and tenants.
• Every lease should clearly identify all parties, the rental property, and the lease term to prevent misunderstandings.
• Rent payment terms, late fee policies, and security deposit conditions should be clearly defined to reduce disputes.
• Clearly assigning utility responsibilities helps avoid confusion and promotes transparency throughout the tenancy.
• Avoiding vague language, outdated lease terms, and generic templates helps create a stronger, legally compliant agreement.

A rental agreement is the operating document for the entire landlord-tenant relationship. Through its terms and conditions, all legal and operational expectations for the tenancy are established. A rental agreement protects both landlords and tenants alike while reducing the chances of disputes and misunderstandings. 

It also includes a detailed description of the rights and responsibilities of both parties regarding the rented property. When any disputes arise between landlords and tenants, the reason for such a dispute can be traced back to poorly worded or missing terms in the lease. 

A well-drafted rental agreement eliminates most or all of these uncertainties related to each party’s responsibility prior to the start of the occupancy period.

At Keyrenter Arkansas, we specialize in guiding landlords through the property management process and helping them build a successful real estate portfolio.

Here are 7 of the essential elements landlords should always include in their rental agreements.

1. Identify All Parties to the Agreement Accurately

Rental agreements must clearly note all parties. 

Details that should be provided in this section of the rental agreement include the full legal name of the landlord renting the property, the property management company’s name (if there is a rental management company), and the complete names of every adult (18 years or older) who will be residing in the rented premises.

This requirement to indicate all adult occupants is important because if the rental agreement is signed by each adult occupant, that adult occupant (name listed in the rental agreement) will generally be liable to abide by the terms of the rental agreement. In addition, legal names provide less confusion and make the rental agreement stronger should any legal matter occur.

2. Accurately Identify the Rental Property

The rental agreement should provide specific information about the rental property, including the complete street address, the apartment/unit number (if applicable), the garage assignments, the parking space assignments (if applicable), the storage unit assignments (if applicable), and any outdoor areas that are included as part of the rental agreement. 

Shared resources at the property, such as fitness centers, pools, clubhouses, and laundry facilities, should be included in the list of things that tenants can use.


Having a good description of the property eliminates any confusion and serves to maintain renter satisfaction.

3. Types of Rental Leases and Duration

The rental contract should also indicate how long your lease will last. Leases could include:

• Fixed-Term Lease: A fixed-term rental agreement can be 6 months, 12 months, 18 months, or 24 months long. The lease should designate a start date as well as an end date.
• Month-to-Month Rental Agreement: A periodic rental in Arkansas is an ongoing agreement that continues until either the landlord or tenant gives legally appropriate notice. There needs to be clear documentation of the notice period required by law.

Defining the length of the lease upfront can help eliminate miscommunications about renewal.

4. Outline the Requirements for Rent Payment

The rent payment section is an extremely important part of the lease because it provides answers to all of the key questions about how/when you will make your rent payments. These include monthly rent amounts, date that rent is due, acceptable methods of payment, where to pay rent, how to make payment, and policies for making a partial payment.

If you allow automatic payments to happen, the lease should make it clear whether this is strongly encouraged or required. Not making the lease payment process clear can sometimes create unnecessary disputes, so ensuring clear communication is crucial.

5. Outline the Policies for Late Rent Payments

Landlords should never surprise their tenants with additional late fees on top of the original rent amount. 

In addition to outlining how much the rent is, there should also be information regarding when the rent becomes late, the length of the grace period, how much the late fee is, and other penalties for continued nonpayment of rent, including potential eviction.

If a landlord writes policies for late payment/fails to collect rent from their tenants, they are able to enforce these terms fairly and consistently to all tenants. When you create these policies, you need to also make sure they comply with all state and local rules/laws.

6. Ensure that Security Deposit Information is Provided

Disputes over security deposits are one of the leading causes of disagreement between landlords and former tenants. 

A well-drafted leasing contract will have the following details concerning security deposits: deposit amount, reason for the deposit, conditions under which deductions may be taken, expected timeframe for refund of the security deposit, and procedure for inspection of security deposit deductions.

Common deducted items typically include unpaid rent, damage to the premises above normal usage, unusual cleaning costs, and missing items from the rental unit. Providing direction regarding these expectations during the term of the lease will reduce confusion at the end of the lease.

7. Specify Responsibilities for Utility Payments

Utility payment responsibilities vary greatly from one property to another. Therefore, rental contracts must list all utility payment responsibilities (i.e., electric, water, sewer, natural gas, trash removal, internet, and cable.

Additionally, if utilities are divided between several tenants, such as in a multi-unit building, the method for determining billing should be included in the contract. Unexpected utility costs are one of the tenants’ biggest frustrations due to a lack of access to accurate information and transparency regarding billing. 

By being upfront with tenants regarding utility payments, landlords can create an atmosphere of trust and increase the chances of attracting long-term tenants.

Some common mistakes when drafting lease contracts

Commonly, a landlord can make errors that could have easily been avoided, and commonly, experienced landlords make mistakes when drafting lease contracts. Common examples of mistakes include: 

• Using ambiguous terminology
• Not including important policies
• Not changing out-of-date terms
• Using a generic lease template
• Not complying with local laws 

A rental lease should be specific to a property rather than using examples from some other property type.

Bottom Line

A rental agreement is the foundation of a successful rental relationship. It outlines both parties’ financial and maintenance obligations, how the tenant may use the unit, and provides the parties with the same expectations before the rental period begins. 

If properly drafted, the rental agreement can be more than just a legal document. It can be a working tool that will facilitate proper control of the property during the rental period.

Get help with everything from rental agreements to tenant screening and maintenance by partnering with a professional property management team.