Introduction to TAA Lease Agreements
The Texas Apartment Association (TAA) deal of your lease agreement is the most common of its kind in the state. It was used for almost three-fourths of all leases in Texas apartment complexes in 2013, and for about 76 percent in 2015. The TAA deal essentially includes all the terms and provisions of the typical apartment rental contract, along with some extra amenities provided by area leasing firms and the TAA. Commonly included among those all-important provisions are the names of the landlord and tenant, the amount of rent to be paid, other costs the tenant will be responsible for during the lease term, the legal description of the property, parking requirements, pet policies and maintenance procedures .
The TAA deal comes in two versions: the standard lease and the short form lease. The standard lease is the full version that includes most, or even all, of the provisions you would find in a rental agreement. In addition to restating the information mentioned above, it includes additional clauses, such as those addressing deposits, pets and defaults on the lease, to name a few. The short form lease generally contains similar provisions, but the provisions are more straightforward. It is best suited for those who may not need to consider all the fine details of a complex lease agreement.
Key Components in a TAA Lease Agreement
Section 91.001 of the Texas Property Code defines a rental agreement as "all agreements, written, oral, and valid amendments thereof, embodying the terms and conditions concerning the use and occupancy of a dwelling." It is a broad and fairly all-encompassing statement. But, for most people, Rental Agreement or Lease means one and the same thing. In the commercial context, however, the terms Lease and Rental Agreement are not synonymous. A Lease, typically, denotes an interest in real property, whereas a Rental Agreement only implies a personal interest in the property. Most often, a Lease is for a term exceeding one year, though short-term leases also exist, whereas a Rental Agreement tends to be in effect on a month-to-month basis or for a shorter duration than a Lease. These key distinctions affect the application of property laws in Texas and particularly the Texas Residential Lease, which is an agreement that complies with Texas law and is offered by apartment complexes, condominiums and townhomes.
Unlike the provisions in a commercial lease, the provisions in a Park Lease or an MH Lease are similar to the terms in a Texas Apartment Association (TAA) Lease. The TAA Lease is a Texas Apartment Association lease that has been approved and is updated on a regular basis by a group of association leaders with experience, knowledge and real estate expertise. The TAA provides a free, online, fillable PDF of this lease through its member website, with blanks for localities, community names, individuals and other details filled in by a licensed real estate professional. This gives attendees at the seminar an opportunity to review the lease and share their experiences with the group. In addition to the consideration, or rent, the TAA Lease establishes the following terms:
A typical TAA Lease will establish the term of the lease as one year unless there is a distinct check box date outside of the lease. For example, it could establish the term as one year from a fixed date except that: (a) the tenant shall have the right to renew the lease upon the same terms for a successive term of one year unless the owner or agent notifies the tenant in writing at least 30 days before the expiration of the original term that the lease will not be renewed; or (b) if both the owner and tenant agree in writing the lease may be renewed for a lesser period of time than one year. Tenants on either side of the lease can issue written notice of non-renewal one month before the lease expires. A TAA Lease establishes the total monthly rent and the due date for rent; the method of payment; the method of service for legal process; rules and regulations; extra charges, including charges for late payment, emptying the Trash or violations of rules; and security deposit. In general, for Texas leases, there is no required security deposit. However, landlords are encouraged to collect a security deposit to cover any unpaid rent or damage done to the premises. Landlords are governed by Chapter 92, Subchapter C of the Texas Property Code, codifying the Texas Security Deposit Act, and must be familiar with what to include in the security deposit, how to refund the deposit, and the consequences if an owner or agent does not follow the requirements. Chapter 92 places certain minimum requirements on landlords who collect security deposits in Texas. These obligations include providing tenants with an itemized list of damages and charges if the landlord intends to retain the full deposit or a portion of the deposit for those items. The requirements for the itemized list vary based on whether the tenant provided notice to vacate and the amount withheld. Based on the timing of the itemized list, the deposit is presumed to be refunded, as required by law, in the amount returned to the tenant unless that presumption is rebutted by a preponderance of the evidence.
Texas Legal Requirements for TAA Leases
Texas state law governing residential leases in Texas is primarily found in Chapter 92 of the Texas Property Code. TAA leases will have additional language addressing lease terms and legal obligations, but TAA lease agreements are governed by the same practical and legal considerations applicable to all Texas residential lease agreements.
Any individual legally authorized to enter into a lease agreement on behalf of the property owner/landlord may sign and execute a TAA lease agreement. Regardless of where the property is located, the individual(s) listed as the landlord or agent on the lease agreement must be the property owner or a person legally authorized by the property owner such as an employee of the property owner, an independent contractor or an agent of the property owner.
Lease Terms: Any lease agreement, including TAA lease agreements, must be for a definite term of not longer than one year, but the lease itself can be automatically renewed for periods of one month or less. A TAA lease could be a definite term lease (for example, June 1st through May 31st) or it could be a month-to-month lease. If the duration of the lease is not included in the TAA lease, then the lease is a month-to-month lease.
Term or Period of the Lease: The TAA lease agreement does not have to have a specific provision regarding the period or term of tenancy.
Security Deposit: TAA lease agreements contain a section regarding the security deposit that includes the maximum allowable security deposit fee that may be charged by a landlord under Chapter 92 of the Texas Property Code. As discussed below, no additional money may be held by a landlord as a security deposit or for any other purpose.
Rent: TAA lease agreements contain provisions whereby a tenant is required to pay the rental value of the leased premises as determined under the terms and conditions of the lease agreement. TAA lease agreements shall contain an additional charge of $10 per late rental payment made after the sixth day of each month. TAA lease agreements contain a provision whereby a tenant is required to pay a $25 service fee for each returned check and that any fees or bank charges assessed by the bank on a returned check will be charged to the tenant. Under no circumstances can a landlord retain or deduct from a tenant’s security deposit a late fee or a service charge for a returned check. TAA lease agreements provide that a $25 lockout fee will be charged if a tenant is locked out after hours without an emergency or a $25 after hours maintenance fee if a tenant calls a locksmith or maintenance during nonwork hours to gain entry into their apartment because of a lost key.
Special Provisions: None
Mandatory Disclosures: TAA lease agreements contain disclosures required by Chapter 92 of the Texas Property Code that include the phone number and address of the Landlord to whom the security deposit must be sent (if different from the landlord identified on the lease agreement), a statement that a tenant cannot take relief from an eviction suit in which the landlord gave notice to vacate by posting a written statement of the grounds for eviction on the front door of the apartment complex and a statement requiring the landlord to give a tenant a written list of items in the apartment complex that are in need of repair if the tenant requests such a list in writing.
Permitted Fees: TAA lease agreements contain a comment stating that the only permitted fees chargeable to the tenant are those permitted by Chapter 92 of the Texas Property Code.
Landlord’s Policies: The TAA lease agreement contains language requiring the Tenant abide by and observe all rules established by Landlord for the safety, care and cleanliness of the apartment community.
Tenant’s Responsibilities: The tenant acknowledges responsibility in the TAA lease agreement to keep and maintain the leased premises in a good, safe and sanitary condition.
Advantages of Using TAA Lease Agreements
A tenant lease, whether it is the Texas Apartment Association (TAA) or your own lease, is a contract between a landlord and a tenant. It lays out expectations for both landlords and tenants, and can be very informative for each party. Generally, a lease should include the following:
When using a TAA Lease, whether you are a tenant or a landlord, you can expect the following advantages:
• TAA Lease Agreements are general and template rental agreements. They help the landlord, tenants, and many landlords will have a standard rental agreement so that they can offer a tenant the same agreement as other tenants. TAA Leases offer tenants a full explanation of the costs associated with renting a property.
• TAA lease agreements reduce the need for interpretation. A TAA Lease eliminates the guesswork of what a landlord wants and does not want. A landlord’s specific needs will be clearly stipulated in the lease agreement.
• TAA Lease Agreements clarify landlord and tenant responsibilities. There are certain tasks for a tenant and landlord that are a part of renting a property. For example, who pays for the utilities? What happens if you are late paying the rent? What if you want to break the lease?
• TAA Lease Agreements are enforceable in court. Using the TAA Lease offers tenants a lease that can be defended in court. The lease can be used as evidence to protect you, if need be. Court cases are very unpredictable, but there must be something in writing to rely on.
Common Problems and How to Fix Them
While the TAA Lease contains numerous clauses dedicated to specific situations, it doesn’t address every conceivable question or circumstance. Here are a few issues that may arise when leasing under the Texas Apartment Association Lease ("Lease").
Payment Agreement Form. The Lease requires all payments of rent and other charges to be made by check, money order, or another form of payment (e.g., electronic payment) as approved by Management in the Lease Information Section of the Lease. If you allow residents to pay their rent in cash (which is never recommended), then you should consider using the optional "TAA Payment Agreement Form" to ensure all payments are properly accounted for.
Accessory Dwelling Unit Agreement. The Lease contains a standard Lease Exhibit, "Accessory Dwelling Unit Addenda," for the leasing or renting of an accessory dwelling unit. However, you may choose to adopt a separate set of rules regarding the renting or leasing of accessory dwelling units. If so, you should use Form D-28 "TAA Alternative Accessory Dwelling Unit Agreement" to set those rules.
Insurance Requirements. The Lease prohibits residents from keeping certain items on the premises or having insurance through the property. If you want to require all residents to carry renter’s insurance, you should consider adopting Form C-14 "TAA Renter’s Insurance Program Addendum" to facilitate the implementation . If your community features swimming pools and/or hot tubs, you may want to consider adopting rules regarding pool and hot tub etiquette in your addendum. These rules could be hard rules, or you could use Form D-9 "TAA Pool and Hot Tub Rules" to meet some of pool safety requirements set forth by Texas law. However, the pool rules form only places restrictions on pool use by minors and only addresses swimming pools.
Lack of Additional Buildings or Structures. If your community already has some parking areas, garages, storage and/or laundry facilities in the existing community, you do not need to worry about including the additional buildings or structures in the Lease. The Lease requires these additional structures to be added to the property before the resident signs the Lease, or during the term of the Lease.
Dwelling with a Fireplace. As most commercial property lawyers will tell you, "have your ducks in a row." Suppose you want to lease a unit out with a fireplace in it. If the fireplace is in good working condition and you have all of the required permits regarding chimney and flue regulation, use Form F-2 "TAA Fireplace Exhibit" or F-4 "TAA Woodstove Exhibit" to address the ownership and condition of the fireplace. However, if your community does not have those facilities or the parts of those facilities are not in good working condition, use Form D-30 "TAA Tenants’ Indemnity and Release of Claims Due to Facilities without Permits Exhibit" to address the situation.
How to Prepare or Obtain a TAA Lease Agreement
In a standard TAA lease agreement, the landlord or property owner is the Lessors(s) and the person(s) occupying the premises under that lease are the Tenants(s). All of the applicants wanting to be on the lease or occupy the apartment must sign the lease before they move into the apartment. All adults (18 and up) who expect to live in the apartment must be identified in the lease.
Whether the landlord and tenant have to obtain a TAA lease agreement does not depend on the landlord or property owner, but instead on the City of Austin and Texas law. State law requires that a lease be in writing if it cannot be performed within one year (for example a two-year lease). Therefore, for a lease longer than one year, there must be a written lease. Article 1, section 29 of the Texas Constitution makes it a violation of the Texas Constitution to pass any local ordinance or state statute that requires a lease to be in writing unless the Crown of England also reclaims the right to receive one. Many cities in Texas have chosen to require a written lease since it helps to keep a relationship between parties civil.
In the past other leases have been used such as a TAR Industrial/Commercial Lease or a TAR/BBG Commercial Lease. For residential transactions rather than a commercial lease, the TAA Residential Lease Agreement is the most commonly used lease in Texas. Many landlords and tenants already have a copy of the TAA Residential Lease Agreement.
If the landlord does not have a TAA Residential Lease Agreement, copies are available at local Board of REALTORS® or the Online Forms Store. These leases, like the TAR and TREC forms, are drafted by a committee for Texas real estate professionals. A broker may be employed to draft the lease. In fact, many brokers do draft a customized lease for their clients because it gives them comfort knowing that the lease has been tailor-made to meet their client’s individual needs. For an individual not working with a commercial broker, it may be best to hire an attorney to draft the lease on the tenants or landlords behalf.
If the use of the following form is to be advised in your situation please consult the TREC rules of Professional Conduct.
TAA Lease Agreement FAQs
What happens if my landlord has my security deposit?
If your landlord is in possession of your security deposit, and if you have fulfilled your end of the lease agreement (i.e. you have paid your rent and completed all terms of the lease) then the Texas Uniform Commercial Code (UCC Sec. 9.102) gives you the right to obtain the property and also requires the landlord to return your deposit. If your landlord is not cooperating, you have the right to sue the landlord for your deposit, including any attorney fees that you incur when filing your lawsuit. In addition, the Texas Property Code (Sec. 92.102) states that a landlord must send you a written notice regarding the disposition of your security deposit within 30 days of the termination of your lease. If you do not receive the notice and your deposit has not been refunded, then you have the right to sue your landlord for twice the amount of your deposit. You are also entitled to the costs of the suit and your attorney’s fees. Caveat: If the grounds for withholding your security deposit consists of charges for damages or other charges agreed upon in the lease (i.e. cleaning, carpet stretching, re-painting, etc.), or if your landlord believes that you owe money to him or her (for rent or other fees), then you may not be able to recover your security deposit until you pay the amounts owed to your landlord. If you owe your landlord rent or other fees, or if you have reasonable charges for damage or other fees, then do not sue your landlord until you have resolved the underlying dispute. Simply add the security deposit to the total amount owed to your landlord. This section is not intended to be, nor should be used as, a substitute for sound legal advice. You should consult with an attorney about your specific situation.
Conclusion and Legal Resources
In conclusion, TAA lease agreements are a vital component of the Texas residential leasing landscape. These contracts govern the relationship between landlords and tenants and help to clarify the rights and responsibilities of each party. By adhering to the terms of the TAA lease agreement, both landlords and tenants can contribute to a more harmonious rental experience. It is important to note that Texas state and local apartment leases may contain specific provisions or terms that differ from the standard TAA lease agreement. Moreover, some apartment leasing companies may utilize their own lease agreements and default terms that deviate from the TAA forms. Regardless of the form of the lease, both parties should familiarize themselves with the terms of their contract and seek legal assistance if there are questions regarding their rights and responsibilities.
Understanding TAA lease agreements may seem daunting, but there are numerous resources available to help navigate these documents. The Texas Apartment Association (TAA) has a number of publications and guides that offer valuable insight into the content and legal implications of TAA lease agreements . For any questions not covered by TAA’s resources, an attorney can be extremely helpful. In addition to TAA’s resources, the State Bar of Texas has made available OnDemand courses covering this and many other topics in its online library. Other online legal resources include the Texas State Law Library and TexasLawHelp.org. However, the best and most accurate advice on any lease issue is to consult with a Texas attorney familiar with residential leases. Local chapter and rental property management associations may also offer webinars or workshops where local professionals speak on the topic of apartment leases.
Remember that in most leases there are two parties whose rights and obligations you must consider: landlord and tenant. While the most useful and informative paragraphs from any apartment lease may be section 35, the interpretation of your rights and obligations as landlord or tenant will always depend on the facts presented in each specific situation. As always, we encourage you to read your lease and the default rules and follow the guidance of a rent house lawyer.