How to Understand the California Residential Lease Extension Agreement PDF

What is a Lease Extension?

In California, a lease extension extends the duration of a lease often on the same terms and conditions as the original leases. Lease extensions may be called a number of things but in essence they are an important part of leasing activity in California. Much like the extension of a contract, a lease extension is often incorporated so that the tenant can continue to use and occupy a property for business or other needs.
Leases are common in commercial real estate, including office, industrial and mixed use development. Not all commercial real estate transactions involve purchasing a property, but more than 90% of them involve leases. The rationale behind a lease, or a lease extension, is to allow the tenant the freedom as a non-homeowner to pay by the month, or the year, rather than locking them into a home loan for 30 years when their business needs will only last 1-2 years.
California leases are often similar in their standard form , but there is no uniform or industry wide standard. Your commercial leasing attorney will be able to guide you on a standard commercial lease extension, or a more customized version that meets your needs. Commercial lease extensions and residential lease extensions may be similar in terms of the purpose, but differ in their application.
The California Residential Lease Extension Agreement PDF can be extended under California Civil Code Section 1945 and 1945. A residential lease is typically a rental for no more than one year, which is not the same as a tenancy for years, as used for residential rental property.
A tenancy for years is a term used in California law to define an estate in possession where the lease period extends for a certain term and ends on a certain date such as in a commercial real estate investment where the lease is indefinite in time and extends for a specified period of time and terminates at the end of that period.

Key Elements of a Lease Extension Agreement

When it comes to residential leases, the California Civil Code Section 1945 requires a written agreement for leases longer than one year, however, not all lease extensions require a written agreement. Some landlords and tenants are comfortable extending the agreement with a handshake and simple verbal confirmation. Nevertheless, knowing the essential components and common details of a lease extension is key to making sure there are no disputes later on.
The Basics:

  • All essential terms of a lease agreement still apply, are clearly outlined, and are agreed upon.
  • Any alterations or changes to the original lease agreement terms or conditions should be laid out clearly.
  • Any additional changes that the parties agree to should be noted in writing.
  • All rent due, due dates, and payment terms should be clear and unambiguous.
  • If any holdback or allowance deposits or payments are related to the lease extension, those terms should be clear.
  • If repairs to the premises are included in the lease extension, terms of that repair should be included.
  • All rearrangements, additions, or other changes to the property should be noted.
  • If the landlord has agreed not to charge additional late fees or penalties due to minor or small past due balances, it should be clearly outlined in the lease extension.
  • Any terms related to the renewal of the lease should be clearly outlined.
  • The options for accepting or terminating the lease should be clearly outlined.
  • There should be a plan for what happens with the tenant’s security deposit.

Why Use a PDF for Your Lease Extension Agreement?

When it comes to residential lease extensions, opting for a PDF format offers several advantages over other file types. Firstly, PDFs provide an added layer of security. Because PDF files maintain their formatting and remain unaltered regardless of the software or device used to view the document, you can be certain that your lease extension will look exactly the same for both parties. This reliability is essential when it comes to legal documents, as any discrepancies in appearance could lead to confusion or even disputes down the line.
In addition to providing a consistent view for both landlord and tenant, PDFs are also easily accessible. With their compact file size, you can conveniently store lease extensions on your computer, share them through email, or upload them to cloud storage. This ease of access makes it simple to refer to a lease extension at any time. You can even transform your lease extension into a fillable PDF online for electronic signatures, offering a modern solution for handling lease agreements without the need for traditional paper and ink.
Another distinct advantage of opting for a PDF format to generate a residential lease extension is the professional presentation. Since PDFs can be easily formatted to include company logos, professional-looking headers, and well-organized tables, they are a perfect fit for businesses. A professionally presented lease extension not only adds to the credibility of your business but also leaves a positive impression on your landlords and tenants.

How to Draft a Lease Extension Agreement PDF

The first step in creating a lease extension agreement is to draft an agreement that is customized to the specific situation. This means including the relevant legal provisions required in California leases and relating to the particular circumstances around your tenant and lease.
There are many common provisions that should be included in every lease. For a lease extension, the most common provisions include a clause that either incorporates the original lease terms into the extension or states that the extension contains all agreements between the landlord and tenant.
Additional provisions include a section covering the rights of both the landlord and the tenant upon the expiration of the renewal period. There should also be clear language regarding the nature of the agreement (i.e. that it is an extension of an existing lease for a definite term, rather than a new lease).
Once the agreement is drafted using a word processing program, you will need to download a software program or app that allows you to create a PDF version of your document. Adobe Acrobat Writer is a commonly used program. Alternatively, you can use one of many PDF conversion websites available online. Of course, once you create the PDF, you must distribute the lease extension agreements to your tenant(s).

Legal Considerations and Legal Risks

To enter into an extension of the Residential Lease pdf, there must be a mutual agreement between the landlord and tenant. Mutuality of agreement requires a true meeting of the minds, something akin to the old adage that there was "an offer and an acceptance," and it must encompass the same subject matter and the same terms.
In this context, the starting point is always the Residential Lease pdf. As a general rule of thumb in California, if the issue or term is not addressed in the Residential Lease pdf, then it is not included in the lease. So, the first thing you do when you think there might be a question or that additional terms will be needed, is to go back to the Residential Lease pdf and see what is actually there. Then, add on the new term in the extension of the Residential Lease pdf.
Specifically, when considering the extension of the Residential Lease pdf , you have to add the word "extension" after each of these terms: 1) term, 2) rent, 3) pet. If you do not add the word "extension" to the item addressed in the Residential Lease pdf, then you have changed it – that is changing the Residential Lease. Unless both parties have agreed to that change, then it is not in effect. It is really as simple as that.
Further supporting California Courts have held:
The best practice for the extension of the Residential Lease pdf is to deliver it to the tenant at 60 days, and provide a signature line with additional space below for them to write in any requested changes. Then you follow up at 30 days, in writing, reminding the tenant that at 15 days, if no changes are submitted in writing and signed they will be expected to sign the extension of Residential Lease pdf as presented.

Mistakes to Avoid

One of the common mistakes that most landlords and tenants make is having no idea what they are signing. In a lease extension, it is extremely important that they know what the terms of the extension are. When you’re signing up the extension, read the document completely and make sure there are no changes from the original lease agreement. Simply assuming that the terms of the lease will stay the same is not always a safe assumption. A previous tenant of mine was told by the landlord that the rent would remain the same. Instead, when the tenant signed the lease extension, the rent was nearly doubled. Make sure both you and the landlord understand the terms of the lease extension before signing, to make sure that you’re not getting the short end of the stick.
Another place where misunderstanding can arise is in regards to the security deposit. If for some reason, a landlord intends to keep a portion of a deposit upon renewal, they must list the reasons clearly in the lease extension. If the security deposit is not referenced in the lease extension, then it is assumed that the original amount is required again. If any changes are to be made to the security deposit, such as the escrow account no longer being used for new tenants and a fee for each month to hold the security deposit, then this should be made clear in the lease extension.
Most landlords feel like lease extensions are just a formality and they may not consider an extension an important legal document that should be signed and notarized. This is one of the major traps that landlords and tenants make. Although a lease extension is a simplified legal document that might just highlight dates and dollar amounts, it has the potential to secure your position on the property for the duration of the extension. If there comes a time when the landlord does not hold up his or her end of the deal, then your lease extension might be the only thing you have on your side. Make sure that you sign the document, get it notarized and get a copy from the landlord. I have seen a couple of tenants who did not follow this process, and were caught off guard by an increase in their rent once the extension was up.

Sample California Lease Extension PDF

Separate from the original lease agreement, a California Residential Lease Extension Agreement PDF is an addendum that states the terms the landlord and tenant must honor until they decide to either leave the agreement remain in effect or extend it for another term. The extension agreement can be used after a lease extension, here are some examples of what should be included in your sample California lease extension PDF at the beginning of the document:
Name(s) of Tenant(s) – This is where all of the names will be displayed;
Physical Address to the Lease – Including the full address, including the city, state and zip code;
Amount of Rent and Where it Must Be Paid – Make sure to include where to file the payment and the period of time you have to pay the rent. The sample guideline for the length would be to state how many days you have after the end of each month until it is considered late, as well as the fee for a bounced check;
The Duration of the Extension to the Lease – Simply state for what duration the lease is being extended (i.e., an additional year’s time). This is entirely in the hands of the landlord and tenant;
Apt Number – Be sure to include the apartment number if you rent one;
Occupants – List all of the people that are allowed to live in the apartment;
Size of the Unit – List the size of the unit in square feet;
Duration of the Terms – List the period of time the lease extension is valid for.

Signing and Executing

Once you have reached an agreement on the extension of the lease agreement, you must now draft the extension agreement. The drafting of the extension agreement should be given the same consideration that the original lease agreement was given between the parties.
Now that the extension agreement is completed, you need to sign the agreement. All of the parties involved in the lease agreement should sign two originals. It is important that you obtain original signatures because having a copy or even a copy with original signatures will not protect you . Several courts have ruled that copies of signatures are improper and that such copies cannot be substituted for the original signatures in the event of a dispute. While most contracts can be performed in California by email, rental agreements and extensions of rental agreements cannot be performed in this manner.
Finally, the signed lease extension agreement should be distributed to all parties involved for their records.

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