How to Create a Digital Lease Agreement

Two people on a laptop creating a digital lease agreement

Digital lease agreements eliminate the stress of printing off lengthy rental contracts, attending time-consuming in-person signings with tenants, and keeping track of sensitive physical documents.

These legally binding digital agreements will help you execute every step of the leasing process — from sending contracts to collecting signatures and storing them securely — entirely online. The result is easier-to-find documents, less clutter, and significant time savings.

Ready to learn how a digital lease agreement can help streamline your rental process? Stay tuned, and by the end of this article, you’ll know exactly how to create a legally compliant electronic lease agreement that you can access anywhere.

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Why More Landlords Are Turning to Digital Lease Agreements

For years, printed leases slowed down a landlord’s busy schedule. Waiting for a tenant to read the lease and fill out the document isn’t the most efficient use of time. And what if you both forgot your pen?

However, since electronic signatures became legally acceptable over 25 years ago, digital lease agreements have gradually become the preferred method to enter into a rental contract.

Because landlords can now create, send, and sign lease agreements entirely online, it doesn’t make sense to print, deliver, sign, and store paper lease agreements.

If you’re still relying on that old-school process and taking valuable time to meet with tenants, you’re selling yourself short. Switching to digital leases will streamline your rental process, minimize errors, and free up valuable time to focus on what matters (like investing in more real estate).

How to Create a Digital Lease Agreement: The Short Answer

Are you ready to create your next legally binding digital lease in under 15 minutes? We’ve got good news for you: the process is simple, and you’re in the right place.

First, start by signing up for TurboTenant’s free property management software.

Next, enter your rental property’s details, add tenants, tweak clauses, customize your policies, and preview your next state-specific lease, all from your secure landlord dashboard.

It’s that simple.

To ensure your contracts are legally compliant, all TurboTenant leases come complete with state-specific landlord disclosures, essential clauses, and customizable terms. And you won’t pay a dime until you review the full PDF preview of your lease and decide to move forward.

We’ve outlined the quick steps to creating a lease with TurboTenant here, but our extensive guide, How to Make a Rental Agreement in 15 Minutes, will walk you through the entire process, from entering your tenant’s details to collecting their legally binding e-signatures.

And if you’re not quite ready to create your next digital lease with TurboTenant, don’t fret. We’ll walk you through the entire step-by-step process of creating one.

How to Create a Digital Lease Agreement: The Long Answer

Pen, keys, and a physical lease agreement

Get your word processor ready. 

Follow the steps below to create a professional-grade digital lease that covers the basics, includes necessary legal clauses, and meets your state’s legal requirements.

And remember: If building a lease on your own gets overwhelming, it’s never too late to use our legally reviewed and compliant agreements to streamline the entire process for you. It beats reusing some old lease agreement you found on the internet and hoping for the best.

Legal noteTurboTenant does not provide legal advice. Always consult an attorney to ensure your lease agreement complies with local laws and regulations.

Step 1: Cover Key Lease Details

Early on in your contract, you’ll need to identify the key parties, describe the rental property, define the lease type, and more. Setting the specifics establishes clear documentation of who’s involved in the rental, the rented property, and the basic terms that guide the entire agreement.

Landlord and tenant details: List the full legal names, current addresses, and contact information of the landlord, tenant, and any property manager involved in the lease.

Property information: Describe the rental unit by including its street address, unit number if applicable, and the type of dwelling (apartment, single-family home, etc.).

Step 2: Add Mandatory State-Specific Landlord Disclosures

Next, you’ll need to include all required state-specific landlord disclosures to inform your tenants, protect your property, and (hopefully) avoid legal trouble. Requirements vary from state to state but often cover lead-based paint, bed bug history, mold, flooding risks, prior drug production within the rental unit, and other similar factors that are relevant to the property.

State laws change often, so research your local landlord-tenant laws to gather an up-to-date list of required disclosures. Important: you can’t rely on last year’s information here; missing just one tiny disclosure could result in fines from your local government or legal action against you.

To avoid costly errors, let TurboTenant handle your next lease agreement. All of our rental contracts include up-to-date, state-specific disclosures that are fact-checked regularly by our in-house legal team.

Step 3: Define Rent, Security Deposit, Fees, and Payment Terms

It’s time to clearly define the rental unit’s financial expectations so that everyone understands all of the recurring payments, when they’re due, and how landlords will collect rent.

Rent amount: State the exact monthly rent and make sure the lease reflects the correct amount in both written and numerical terms.

Due date and payment: Specify when rent is due and include an outline of any late rent grace period allowed by state law, if applicable.

Payment methods: List every acceptable payment method, such as cash, checks, bank transfers, money orders, ACH, or peer-to-peer services. Unsure which payment methods to accept? Read our guide on the best way to collect rent as a landlord.

Late fees: Outline when late rent fees apply, their costs, and how you will enforce penalties.

Security deposit: Disclose the total security deposit amount, where you will keep it (if required by law), and situations when you’re allowed to make deductions, such as:

  • Unpaid rent or utilities
  • Damage beyond normal wear and tear
  • Cleaning costs after move-out
  • Expenses associated with lease-breaking
  • Costs to re-rent the unit due to an early termination

Other fees: Include any additional charges that apply to the lease agreement, such as:

  • Pet fees or pet rent
  • Parking fees
  • Amenity or facility access fees
  • Pest control fees
  • Application or lease renewal fees

Note: TurboTenant’s lease generator provides up-to-date guidance on security deposit amounts and late fees, ensuring you don’t unknowingly break the law.

Step 4: Outline Property Maintenance Protocols

maintenance illustration

In this section, you’ll clarify who handles property maintenance duties, like lawn care, snow removal, or appliance repairs. Divide responsibilities clearly between the landlord and the tenant, and follow state laws when assigning duties.

Don’t forget to include maintenance coordination procedures, expected landlord response times, and emergency contact information for pressing issues.

Tenant’s responsibilities: List the tasks tenants are responsible for to keep the property in good condition and meet basic cleanliness and safety standards, such as:

  • Maintaining a clean and sanitary living space
  • Disposing of trash regularly and properly
  • Using appliances and fixtures respectfully and responsibly
  • Reporting maintenance issues to the landlord promptly

Landlord’s responsibilities: Define the duties you must fulfill to keep the property safe, clean, habitable, and up to code, such as:

  • Handling major repairs and structural issues
  • Providing essential services like heat, water, and electricity
  • Addressing pest infestations
  • Responding to repair requests within a pre-determined timeframe

Maintenance requests: Establish a straightforward process for tenants to submit maintenance issues, including the procedures for reporting problems promptly and accurately.

Contact information: Provide phone numbers and email addresses that tenants can use to report routine maintenance or urgent issues.

Response time: Establish clear expectations for how quickly you will respond to non-emergency repair requests, considering local regulations and realistic response times.

Emergency procedures: Outline the specific steps tenants should take during emergencies, including who to contact and what types of issues qualify as “urgent.”

Step 5: Set Rules for Living in the Rental Unit

Next, you’ll need to set clear property rules so tenants know exactly how to treat the rental unit and respect those around them. Establishing guidelines on pets, smoking, noise, and quiet hours will help protect your property, reduce disputes, and encourage a more drama-free rental experience between your tenants and their neighbors.

Pets: State whether pets are allowed in the unit and, if so, list any restrictions on breed, size, or type, along with any pet-related fees. Account for service and emotional support animal (ESA) laws.

Smoking/vaping policy: Define where tenants can and cannot smoke or vape on the premises, including inside the unit, near entrances, on balconies, and in shared spaces.

Noise and behavior: Establish expectations for quiet hours and rules regarding parties or gatherings to prevent disturbances and protect neighbors’ right to peaceful enjoyment.

Property alterations: Determine whether tenants can make changes to the property and describe the approval process for updates like painting walls, drilling into the drywall, or planting a garden.

Step 6: Discuss Division of Utilities

Break down each utility (water, sewer, trash, recycling, electricity, gas, internet, etc.) and state who pays which bills to prevent billing disputes. Address any shared meters, how billing works for them, and where tenants should send utility payments.

Included utilities: List any utilities covered by the rent and clarify that the tenant will not be billed separately for them.

Tenant-paid utilities: Specify which utilities the tenant must pay directly and name the providers to whom they must make payments.

Step 7: Detail the Logistics for Ending or Renewing the Lease

Every lease should outline the specific procedures both landlords and tenants should follow as the contract’s end date approaches. In this section, you’ll specify the notice period for renewals/terminations, how to coordinate move-outs, and whether the lease will terminate, renew automatically, or convert to month-to-month after it concludes.

Ending the lease: Provide clear instructions on how tenants should give notice of non-renewal, including the required notice period and methods for communicating their intentions.

Early termination: Outline the situations that allow landlords or tenants to terminate the lease prematurely, such as military service, domestic violence, or significant lease violations.

Renewal terms: State whether the lease will automatically renew upon expiration, convert to a month-to-month agreement, or require a new contract.

Fixed-term vs. month-to-month considerations: Discuss the differences in notice periods, renewal rules, and termination protocols between fixed-term and month-to-month leases.

Step 8: Include Legal Clauses to Protect Both Parties

Next, you’ll need to strengthen your lease by including specific legal clauses that outline eviction policies, subletting rules, insurance requirements, and dispute resolution procedures.

Eviction: Define the legal grounds for tenant eviction, like failing to pay rent or violating lease terms, and outline the legal procedures based on your state’s specified requirements.

Subletting: Determine whether you allow subleasing and/or subletting of the rental unit and include any requirements for doing so, such as obtaining written landlord approval, conducting replacement tenant screening, or paying any associated fees.

Renter’s insurance: Require that tenants carry renters insurance and define the minimum coverage amount they must sign up for. Also, address whether the tenant must list the landlord as an additional interested party on the coverage.

Dispute resolution: Establish a process for addressing disputes between the landlord and tenant (such as requiring third-party mediation or arbitration) before allowing either party to pursue legal recourse.

Governing law: Specify that the state’s landlord-tenant laws apply to the lease to ensure the contract complies with local regulations and remains enforceable in the event of issues.

Severability: Add a clause explaining that if any section of the lease becomes void or nonbinding, the remaining provisions will still apply to all parties who signed the contract.

Step 9: Review the Lease for Clarity and Legal Accuracy

Next, you’ll need to comb through your lease to ensure it communicates rental terms clearly, accurately, and lawfully. Edit and clarify vague wording or confusing clauses to ensure the rental contract reflects your state’s current legislation and follows all applicable rental regulations.

Clarity: Use clear, straightforward language throughout the lease and remove unnecessarily complex legal terms that could confuse tenants.

Compliance: Double-check that the lease complies with all applicable federal, state, and local landlord-tenant laws, including rules regarding landlord disclosures, security deposits, notice periods, and other relevant requirements.

Legal review: Hire a real estate attorney and pay them a handsome fee to review your lease and verify its enforceability and validity with current rental laws.

Digital lease templates: Alternatively, consider utilizing a legally reviewed lease template from a reputable source to save valuable time and money.

Step 10: E-Sign and Finalize the Digital Lease Agreement

Lastly, you’ll need to finalize the lease by gathering e-signatures from tenants, co-signers, and, of course, yourself. Signing the lease will confirm all terms, lock in responsibilities, and generate secure digital copies for future reference.

E-signatures: Add signature fields for both parties and use a legally recognized e-signature platform to ensure the lease is valid and enforceable.

Witness or notarization: Check your state’s laws to determine if a lease requires a witness or notary. If so, follow the protocols to ensure a legitimate lease signing.

Create Your Next Digital Lease Agreement with TurboTenant

With TurboTenant’s property management software, you can create state-specific leases, e-sign with tenants, and store everything securely online in the time it took you to read this article.

No printing. No in-person meetings. No holding onto cumbersome physical contracts.

Not to mention, TurboTenant can also help you market rentals, send applications, screen tenants, collect rent, coordinate maintenance, and handle accounting, in one secure location.

Sign up for a free TurboTenant account today to ditch antiquated paper contracts in favor of a fast, secure, and digital alternative.

FAQ: Digital Lease Agreements

Are digital lease agreements legally binding?

Digital lease agreements are legally binding as long as they meet state requirements and include valid electronic signatures from both parties. Most states recognize e-signatures under the ESIGN Act and UETA, making digital leases enforceable in court.

How do I create a digital lease agreement?

Creating a digital lease agreement is a straightforward process when using the right software. TurboTenant, for instance, will guide you through the entire leasing process from start to finish in under 15 minutes.

What is the difference between a digital lease and a traditional lease?

Digital leases use electronic signatures and are stored securely in the cloud, allowing landlords and tenants to access them instantly from the internet. Traditional paper leases require wet ink signatures and manual storage, making them harder to track, organize, and access.

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