The Minnesota Lease Agreement Guide
In essence, a lease agreement is a legal contract between a landlord and a tenant, typically for the rental of land or housing. It outlines the parties involved, the property to be leased, and the rights and responsibilities of each party. Lease agreements are important documents since they allow both the landlord and the tenant to know what is expected of each of them before, during, and after the lease period, and what, if any, damages could occur if these provisions are violated.
Simply put, a standard lease agreement is an agreement that is issued by the Minnesota Multi Housing Association and follows all the laws set forth by the Minnesota legislature. In other words, by using a standard lease agreement, you do not have to worry about whether or not it violates any laws. Therefore, it is best to use one of these lease agreements over a customized version that may or may not follow these rules.
The Minnesota landlord and tenant laws state that information that must be included in the rental agreement is the following:
- The legal names of all adults who will be living in the apartment
- The date the agreement will begin
- In some instances, the agreement will include a required notice to vacate that must be given to the tenant before the tenant can move out
- The tenant should be able to read the entire lease agreement and understand what it is about , especially the sections that state the rights and responsibilities contained in the agreement
- The rental premises, including the building, apartment, and any garage, storage unit, or other property that is included in the rental agreement
- Amount of rent due and when it is due
- Any additional charges that will be added to the rent, such as utilities
- Size of the security deposit and how it will be held
- If a pet deposit is required, it must be included under the rental agreement as well
- Terms of lease renewal, if applicable
- Circumstances in which the landlord can terminate the agreement
- Ground rules that should be followed while in the property, including eviction
- Terms and conditions for returning the apartment in good condition
There are other parts of the lease agreement that are allowed by law but not always required, such as permission for pets. A tenant would do well to be aware of what is in the lease agreement so he or she is aware of all responsibilities that they will have while living in the property. Concrete lease agreement laws in Minnesota help both parties have a good relationship while living in the property and allow for an exit without too much hassle.
Essential Features of a Minnesota Lease Agreement
Lease or rental agreements come in many forms. A formal, written rental agreement, in most circumstances, is not required under the Minnesota Landlord Tenant Act. However, it’s certainly the best practice, both from a landlord and tenant perspective, to have one. A properly drafted lease establishes rules and identifies the responsibilities of landlords and tenants, limiting the chances for misunderstandings and problems in the future. So while it pays to take the time to put one together, you’ll be glad that you did.
At a minimum, the key elements of a lease agreement include: the parties to the lease (landlord and tenant), the premises being rented, the amount of the rent, and the term of the lease. By way of example (although the details are varied), the following might be in a standard lease agreement:
- The Landlord. As used in this lease, "Landlord" shall mean ABC Apartments, L.L.C., a Minnesota limited liability company, and its successors and assigns; it shall also include the current management of the premises, any successor person or entity to such management, if that person or entity has assumed the obligations of the Landlord under this Lease.
- The Apartment. Landlord rents to Tenant the apartment located in the building known as ABC Apartments and described as follows: Apartment No. 101, Rentable Area approximately 1,025 square feet, Rent: $820.00 per month (including all utilities except electricity, phone, TV and gas for fireplace). Rent is due and payable the first day of each month in advance.
- The Term. The term of this lease is for one month commencing on February 1, 2003 and terminating at midnight on the last day of the term. Tenant may remain in possession of the apartment after the expiration of the lease only under the conditions and in the manner set forth in this lease. The above is certainly a bare-bones example of a lease agreement. A more detailed lease will include provisions setting forth additional important terms, such as: the security deposit; entry and other rights of the landlord; duties of the landlord (including repairs) and renter (for example, the obligation to keep the unit free from vermin); maintenance and repair provisions; restrictions on pet ownership; and, provisions dealing with the early termination of the lease.
Minnesota Lease Legal Conditions
In addition to the required disclosure of the names and addresses of the landlord, managers and person authorized to act on behalf of the landlord, a lease must also contain a notice of tenant’s legal rights, remedies and duties under Minnesota law. That notice is attached here. The notice applies only to residential leases, but the required statement can be added to the end of the Residential Lease Agreement.
Minnesota law does not require the use of a written lease to establish a tenancy, but a written lease is an excellent tool to protect landlords.
In addition to complying with the disclosure requirements, Minnesota law requires a written lease in certain circumstances. If a rental agreement between a governmental unit and prospective tenant has a term longer than one month, the agreement must "reflect reasonable provisions that insure that the landlord is fairly compensated for the cost of administering, maintaining, managing and improving the property to be rented, including at least the reasonable cost of the following: utilities, garbage collection, plowing, salting, and maintenance of any common areas or recreational facilities." Minn. Stat. ยง 471A.14. This statute was enacted in 2013 to prohibit large government units from providing free utilities to large groups of people. Although the Ramsey County Community Services Department’s standard Residential Lease has some language about the Ramsey County Community Services Department’s utility billing and reimbursement policies, I don’t think its language is sufficient to satisfy the disclosure requirements of this statute.
All leases must also have provisions regarding lead-based paint, mold, smoking, bedbugs and criminal activity.
Lead-Based Paint disclosure is required for all residential housing constructed before December 6, 1978.
Realtors in Minnesota included a requirement that any lease involving a property covered by the City of Minneapolis Smoking Ordinance must include a provision that the "lessee shall not smoke and/or permit others to smoke . . . in violation" of the ordinance. In order to comply with this law, real estate attorneys must modify the A0500 – Residential Lease document (Residential Lease) rather than use the realtor form with the smoking ordinance language. My opinion is shared by Minneapolis government officials who have advised property owners that if smoking restrictions are not included in lease agreements, the property owner may not be able to evict the tenant who violates the ordinance. Minneapolis frequently changes the ordinance so landlords ought to stay in close contact with their attorneys.
Landlords must also state their bedbug policy in their leases. I drafted the following statement to be used with my Residential Lease Agreement:
Please be aware that bedbugs are a nuisance and can be expensive and difficult to control. Please do not introduce any used furniture, bedding or clothing into your apartment without first having the item professionally treated to ensure that it is free of bedbugs and their eggs. If you believe that you have been exposed to bedbugs or find bedbugs in your apartment, please do the following: 1. Notify us immediately! Time is of the utmost importance. Please give as many details as possible. We may need to ask you questions to try and determine the source of the problem. 2. Do not bring any used furniture, mattresses, box springs, clothing, etc. into your unit until it has been professionally treated to ensure that it is free of bedbugs and their eggs. 3. As a precaution, do not sit or lay down on any unused furniture until you know for certain that it is free of bedbugs and their eggs. 4. Do not throw away clothing or other items before first contacting us. It is important to have these items examined by a professional to determine if the items are infested. 5. If you or a member of your household travels and stays in hotels or stay with family or friends who live or have lived in a multifamily environment, it is recommended that precautions be taken to reduce the risk of exposure to bedbugs. Travel smart by checking places you are staying for signs of bedbugs, keeping luggage off bedbug infested surfaces, and inspect your luggage when returning home. Do all you can to avoid bedbugs!
An attorney required disclosure statement warning tenants about criminal activity also needs to be included in all Residential Lease Agreements. I drafted the following statement to be used with my Residential Lease Agreement:
NOTICE OF CRIMINAL ACTIVITY ON THESE PREMISES
Under Minnesota law, a person obtains no property right in an apartment unit. All apartment units are subject to search by law enforcement at any time. All persons who reside in apartments may be subject to arrest and prosecution for any criminal activity which occurs on the premises, and violators will be evicted.
Frequently Seen Lease Provisions in Minnesota
Common Clauses in a Minnesota Lease Agreement
Another vital aspect of a lease agreement is security because, without it, the landlord would have no recourse when the tenant destroys their rental unit, violates another clause of the lease, or fails to pay their rent. The standard lease in Minnesota will often have a provision that states that the tenant will pay their security deposit no later than the time they sign the lease. A common retainer amount is a month’s rent, although landlords may be able to retain reduced amounts if they agree to save the security deposit for damage, breaches and non-payments.
A security deposit is any money a landlord withholds to cover unpaid rent, repairs to the apartment or even unpaid utilities. Besides money for smoking, disturbing other tenants, creating an unlawful nuisance and violating parking agreements, this money can also be held to fix any minor damages. For example, if the apartment needs touching up of the walls and the carpets need to be shampooed, this is a repair that is considered the tenant’s responsibility if they have done unlawful things, like smoking in the apartment. However, if the unit simply needs some minor paint and shampooing of the carpets from normal use, then the landlord cannot legally withhold the security deposit from these minor issues.
Usually, an apartment building that has over five rental units will often include an option for lease termination. Often included in this provision is a 30-day notice requirement, which landlords utilize when they don’t want to renew the tenant’s lease at its expiration. If a lease does not specify the method by which a tenant can choose to terminate the lease, there are several methods that Minnesota law lists for lease termination, and they include:
The Minnesota standard lease agreement will often have provisions for tenants asking for service or maintenance requests that are required by a landlord to provide. Another section in the lease is for the landlord to ask tenants for access to the unit to maintain certain things, and it specifies when they can enter the unit for repairs. For example, if the tenant signed the lease on the tenth day of the month, and the rent is due by the first day of the month, the lease might state that the rent must be paid by the fifth or sixth day of each and every month. The lease will often allow the tenant to pay the rent without incurring a penalty as long as the late fees are not charged until the sixth or seventh of the month following the non-payment.
Late fees are charged to the tenant if they do not pay the rent on time, and those late fees are often stated in the lease agreement. For example, the lease agreement states that the tenant will pay $100 as a late fee, or one and one-half percent of the monthly rent payment calculated on a daily basis. The Minnesota average late fee is $95 per month. Usually, a landlord is required to state its policy on late fees in the lease agreement because it will allow the tenant to understand how much they will owe the landlord for late fees.
Advantages of Utilizing a Standard Form Lease
The Minnesota Standard Lease Agreement Template is advantageous for landlords and tenants alike. For one, a standard lease template ensures that both parties have a common understanding of their respective rights and responsibilities. Such understanding is crucial in the event that problems arise during the lease period and one party is forced to seek redress against the other party. In fact, in the event that a matter goes to trial, judges will refer to the lease as evidence of the mutual intent of the parties and as such, both the lessee and lessor are best served when the terms and conditions of the lease are clear and unambiguous.
In addition to ensuring clarity, adopting a standard lease template ensures consistency. For example, a lease template will ensure that important information, such as the amount of the monthly rent, the date on which the rent is due, and any grace period, is consistently recorded by the landlord in each lease drafted . In addition to ensuring that the foregoing information is recorded in the lease, the template will also ensure that the information is always recorded in the same location in each lease agreement.
As previously noted, agreements that are entered into by parties in the state of Minnesota are governed by Minnesota state law. Adopting a standardized lease agreement template will ensure that the parties’ lease is compliant with state law. Further, leasing templates will ensure that the conditions imposed by the state (e.g., security deposits) are included in the parties’ agreement. For example, Minnesota law does not allow a landlord to impose a security deposit that is greater than the amount of two month’s rent. A standardized lease template will ensure that the language in the lease complies with the law.
How to Create a Minnesota Lease Agreement
The process of drafting a Minnesota standard lease agreement is not terribly long. While there are many differences in the details of the Minnesota standard lease depending on the rental property (and what statutes apply), the process is largely the same.
An easy place to begin drafting is by downloading the lease agreement from the City of Minneapolis and the City of Saint Paul. Many other cities also have their own rental housing forms (Ramsey County and State of Minnesota even have their own). While these page and paper count heavy documents are littered with legal boilerplate designed to scare tenants, Minnesota law is very protective of tenant’s rights in the event of a dispute. For this reason, I recommend my clients don’t overthink their lease negotiations too much. However, it is still important to specify certain things for clarity.
Typically, I counsel my clients to "cut out the fat." Take the pages of rental housing forms download from the City of Minneapolis and only use the provisions that apply to the specific property. The Minnesota standard lease agreement is no different. It is important to make it specific to the terms of your rental property. Do not copy and paste from other leases and do not just add provisions you’ve read online. Instead, keep it simple – specify your terms fairly and uniformly. When there are common challenges, focus your efforts on putting them in writing.
Though it is important to identify and specify the terms, when it comes to drafting a Minnesota standard lease agreement, the point is not to be so specific that it addresses problems that may never happen. Otherwise, many clients spend a lot of time and money thinking about problems that probably won’t happen. As a commercial real estate attorney, I tend to play a little devil’s advocate and take that time from my clients to see what they are up against. But for the vast majority of people, it is unlikely that a tenant will request to paint the room electric purple. And it is very unlikely that a neighbor will complain to the police about a tenant’s 12am drum lesson.
Helpful Resources for Minnesotan Landlords and Tenants
There are numerous resources online to assist both landlords and tenants in Minnesota. For example, here is a link to the Minnesota Joint Powers Cities of Anoka, Dakota, Hennepin, Ramsey and Washington webpages. The City Pages provide Minnesota landlords and tenants with a helpful overview of Minnesota laws affecting landlord and tenants and are available both online and in print through the City of St. Paul’s Department of Safety and Inspections.
The Minnesota Department of Health has Online Educational Materials for Landlords which include basic information about lead , mold, noise and pest control for Minnesota landlords and property owners. The Minnesota Attorney General’s Office also provides informational sources on many topics relating to common consumer problems, including renters’ rights and duties.
Another great Minnesota landlord and tenant resource is The Landlord’s Legal Handbook, which is published annually by the Minnesota Department of Commerce.