What Is a Lease Renewal Agreement?
A lease renewal agreement is a legal document that extends a tenant’s lease for a new term, keeping the rental agreement active. The agreement serves as a legal record between a landlord and an existing tenant who intends to continue renting a space.
Lease renewal agreement usually retain the key terms and conditions of the original lease. However, landlords and tenants may use the renewal period to renegotiate some terms. For instance, a landlord may increase the monthly rent or change the lease term length. Or, a tenant might ask permission to keep a pet in the home.
Lease Renewal vs. Lease Extension
While a lease renewal agreement extends a tenant’s lease for a new term, it’s important to distinguish it from a lease extension. A renewal creates a brand-new lease contract, often with updated terms, while an extension simply prolongs the existing lease for a short period under the same conditions.
Lease renewals are best when:
- landlords want long-term rental stability
- new terms, such as a rent increase or policy updates, need to be included
- both parties are committed to continuing the rental relationship for a full lease term
Lease extensions are ideal when:
- tenants need temporary flexibility before moving
- landlords want to keep the unit occupied but aren’t ready to commit to a new lease term
- both parties need a short-term solution without renegotiating a new agreement
Choosing the right option depends on your long-term goals. If you’re looking for a smooth, legally sound lease renewal process, Legal Templates offers customizable lease renewal agreement templates that make it easy to finalize terms and ensure compliance.
Should You Renew Your Tenant’s Lease?
Renewing a tenant’s lease may save time and money. For one, a renewed lease means landlords don’t have to vet new applicants or advertise an available rental. The hassle of scheduling property viewings and reviewing rental applications goes away.
Since a renewal keeps the tenant in the property, landlords can skip the maintenance and repairs and deep cleaning that often comes with a move-out. There’s also no need for a formal inspection, key handover, or issuing a lease termination letter.
By simply renewing the lease, landlords can maintain a steady stream of rental income and cover the property’s expenses.
| Renew the Lease If | Consider a New Tenant If |
|---|---|
| Tenant pays on time | Tenant pays rent late |
| Tenant respects space | Tenant damages space |
| Tenant abides by lease | Tenant breaks lease terms |
If you decide not to offer a lease renewal agreement, carefully review local rental laws and consider providing a formal notice to vacate letter. Most states require landlords to give a tenant a notice of non-renewal at least 30 days in advance, depending on the length of the original rental term. Long-term tenants may have additional rights that require landlords to provide an option for renewal of the lease agreement unless there’s a legally justifiable reason not to.
How to Renew a Lease
Renewing a lease starts with preparing a lease renewal agreement. The agreement outlines the essential details of the renewal, including any changes. Using a lease agreement renewal template simplifies the process of renewal. A landlord can modify it for any lease changes, such as updates to tenant names or monthly rent amounts.
Follow these steps to renew a lease:
1. Send a Lease Renewal Notice
Start by notifying a tenant that it’s time to renew their lease agreement. Take this step early to clarify the tenant’s intentions. If they opt not to renew, an early notice gives landlords adequate time to find a new tenant, potentially avoiding lease gaps.
Use the notice to highlight any new terms you want to introduce to the lease, such as changes to the monthly rent. Landlords can also propose a new lease duration.
Include a deadline to respond to a lease renewal notice to encourage a prompt response.
2. Negotiate Any Changes
If you’re adjusting rent or other lease terms, be prepared to discuss them with your tenant. The tenant may wish to negotiate changes, such as the option to sublease the property or request their own updates. It’s up to landlords to decide whether to accept any changes to the original terms.
Once both parties agree on any proposed changes, the landlord can add them to the lease renewal agreement. If there are no changes to the lease’s terms and conditions, mention that the original lease agreement remains unchanged and “remains in full force and effect.”
3. Update the Lease Agreement
Use our lease renewal agreement template to extend the lease.
- Incorporate any revisions to terms and conditions, monthly rent, and lease end and start dates.
- Save a copy of the original lease agreement along with the renewal.
Unless the landlord and tenant agree to modify the original lease terms and conditions, they may still apply.
4. Sign & Store the Document
Arrange to meet with the tenant to sign the lease agreement renewal. Both parties should review the contract and address any questions before signing it. Save the agreement with your important records and you may wish to electronically store it, too.
Some states may have notarization requirements for lease agreements. If state law requires notarization of the agreement, you may need to sign it with your tenant in front of a licensed notary.
Lease Renewal Laws by State (Notice Periods & Rent Control)
Many states require you to notify a tenant of intent to renew before a lease expires. Best practices are to give the notice at least 60 days ahead of time unless local law requires an earlier notice.
A few states and local jurisdictions also have rent control laws. These laws limit rental increases with the goal of keeping housing affordable for local residents. If your property is subject to rent control, keep any rent increases in line with regulations.
| State | Notice Periods |
|---|---|
| Alabama | No notice for yearly/fixed leases; 30 days for month-to-month. |
| Alaska | No notice for yearly/fixed leases; 30 days for month-to-month. |
| Arizona | No notice for yearly/fixed leases; 30 days for month-to-month. |
| Arkansas | No notice for yearly/fixed leases; 30 days for month-to-month. |
| California | 60 days if tenant has lived ≥1 year; 30 days if |
Ready to Renew Your Tenant’s Lease?
Renew your tenant’s lease in minutes—without the legal guesswork. With the Legal Templates document editor, you get:
- customizable lease renewal agreement you can tailor for your property
- built-in disclosures and terms that align with state and federal rental regulations
- accessible document you can edit, download and print at your convenience
Our service includes step-by-step instructions to walk you through the process, so you can confidently draft your document. Start drafting your lease renewal agreement today!
Lease Renewal Agreement Sample
Below, you can view a sample of our customizable lease renewal agreement. Using our document editor, you can fill the template to meet your needs and then download it in PDF or Word format.
Frequently Asked Questions
Is there a limit to how many times a landlord can renew a lease?
Currently, no federal or state laws limit the number of times a landlord may renew. Landlords can renew a lease as many times as they like, so long as a tenant wants to remain in the property.
What happens if a tenant doesn’t renew the lease but stays in the property?
If a tenant stays in the property without renewing their lease, the agreement shifts to a month-to-month tenancy under most state laws. The original lease terms still apply, and either party can end the arrangement by providing adequate notice. Tenants who remain in the property after the expiration of their lease term without a landlord’s consent risk eviction and other legal remedies.
What is an auto-renewing lease, and are they legal?
An auto-renewing lease automatically renews for a set timeframe. Most states allow them, but check your state and local laws to see if they’re permitted.
What legal remedies are available if a tenant moves out before a lease renewal term ends?
Landlords may file a lawsuit to recover the remaining rent due under the lease renewal, plus any extra costs. If you have a solid relationship with the renter, consider working with them to resolve the issue. You might be able to avoid a lawsuit if they cover costs while you find a new tenant. Or, you could negotiate a buyout in exchange for an early lease termination.
