How to Help New Tenants Understand Their Leases

Jon Fesmire | Jun 20, 2017 @ 12:38 PM

Each self storage facility will have at least one version of its lease, especially if the company operates in more than one state. However, there are some basics you’ll find in all storage leases. It’s important for your customers to understand what’s in the lease so that they can follow your facility’s rules and the law.

This article covers the basics, the information you should impart to your tenants when they first sign the lease.

Payments

The first section of the least should cover payments. This includes which unit the tenant is renting, how much they are to pay per month, what date the payment is due, and how much late fees are for late payments. Make sure the customer knows how they can pay as well, such as if they have to pay in person, if they can set up a monthly, automatic charge to their bank account or credit card, and if they can pay over the phone or online.

Locks

In general, if a customer does not have a lock on his or her unit, the facility will overlock it until the customer takes care of the problem. Make sure the customer knows that this may happen. They should also know that they can get locked out of the unit after a certain period of non-payment.

Use of Premises

The lease will also cover when and how the tenant is allowed to use the premises, which should be fairly straightforward. They need to know that only one car at a time can go through the gate, that they can access their unit only during open hours (and that the grounds may be open later than the office), and that when done bringing in items, picking up items, or cleaning up their unit, that it’s time to go. No loitering.

They also need to know their access code, which you may have on the lease, or on a separate piece of paper. Make sure they know how to get in and out safely and correctly.

In a way, the most important part of the lease has to do with what tenants are not allowed to do on the premises of your facility. Even though it should go without saying, they need to know that any illegal activity is prohibited in their unit or on the grounds. Though the facility has lights, and there may be an overhead light to use in their storage unit, they may not use electricity for other items. (In some facilities and in some situations, this may be different. We’ve all heard of facilities that allow rock band rehearsals.)

Dangerous materials, including anything flammable or explosive, are also prohibited. An accident could damage or destroy the buildings and tenant property.

To prevent pest infestations, perishable foods, any open food containers, live plants and live animals, are disallowed as well. When it comes to live animals, in many cases this would be illegal and an animal cruelty issue, anyway.

Make sure to cover all this information with the new tenant. When infestations do occur, it’s usually due to tenant negligence, so the more who follow the rules, the better.

Security

Security is mostly the responsibility of the facility. This section of the contract should cover what sort of security your facility has and what tenants can expect. It can also cover tenant behavior, such as making sure the gate closes, that only one car comes through at a time, and that the tenant does not linger on the facility longer than necessary.

Subleasing

This one is easy. The tenant should know they are not to sublet their unit or a portion of it to anyone else.

Insurance

Many facilities require that tenants purchase a minimum amount of insurance. Make sure the tenant knows how much this is and that their monthly payments will include the monthly insurance premium. Also, make sure they know their options for purchasing more insurance, if desired.

Conditions of Nonpayment

Finally, tenants need to know what happens if they don’t pay. How long is the grace period before they face late charges? How long until the facility locks the tenant out until they pay? How long before the process to bring the unit to auction begins? This last varies per state, and tenants should have some idea of how the process works.

Reading legal documents can be difficult for many. Contracts are often written in complicated, confusing language. So when possible, help your new customers out and go over these important points.

Finally, consider writing up a one page document that explains the lease in easy-to-understand English, and make it available to your renters. This can save you time, and make life easier for your new tenants as well.