An Overview of an RV Lease Agreement
Lease agreements are a type of legal contract, most commonly for a motorized vehicle, and typically for a term of time. With a lease agreement, the owner of the RV is essentially lending it to someone for a cost, which is typically a monthly fee.
An RV lease agreement essentially formalizes the following: who owns the RV, who can use the RV, who is responsible for maintenance, who is responsible for damages and/or repairs, and how long the lease will be in effect. A lease agreement also normally establishes what happens at the end of the lease – for example, does the owner of the RV want it back, or will the lessee have the option to buy the RV at the end of the lease? In a lot of ways, an RV lease agreement is similar to a traditional home rental agreement .
As with leasing any other type of vehicle, leasing an RV is a way to have an RV without the high cost associated with purchasing one. Leasing a vehicle typically has a lower monthly payment, which can make it more affordable to enjoy this type of travel. However, most leases have mileage or usage restrictions. This differs from a purchase agreement, which conveys ownership of the RV (and therefore, no usage restrictions other than those provided for under the state’s motor vehicle code).
The Essential Components of an RV Lease Agreement
An RV lease agreement is different than a traditional lease agreement for an apartment or home. With a "recreational" vehicle, the site can be much more important than the unit itself. Thus the lease agreement must address specific issues that are likely to come up. But first, what issues are most likely to come up?
The most likely problems are:
• The Site Location
• Rent and Payments
• Maintenance Obligations
• Expiration
• Renewal
We will dissect each one of the above issues and how to address them in the lease agreement below.
Site Location
The location of the site should be reflected in the lease agreement itself. In addition, specific questions about the unit’s location should be covered in the lease agreement. For instance, what happens when the lakefront location becomes central to the RV Park’s expansion? The lease agreement should cover how a shift in the site’s location impacts the rent. In addition, the lease agreement should address location by references to other documents such as a set of bylaws or maps showing the location of each site. Addressing the location of the site not only protects the tenant but also the RV park.
Rent and Payments
The lease agreement must address when the lease payments are due. It must also address the consequences of missed or past due payments. For instance, if the payment is 1 day late or even 1 hour late, will the tenant have to pay a late fee? Again, there should be a reasonable limit on how long the RV park can wait before taking action on the missed payment. For instance, will the tenant have 3 days, 5 days or even 10 days to make the missed payment?
Maintenance Obligations
Another critical element of the lease agreement is the parties’ obligations when it comes to maintenance. However, the lease agreement should make clear that the park is not responsible for all maintenance. A good lease agreement will address the following issues:
• Does the Tenant have to mow the lawn, maintain shrubs and trees, and even shovel snow from walkways?
• Does the Tenant have to keep the area free of litter?
• Is the Tenant responsible for maintaining the exterior of the RV unit?
Expiration
The lease agreement should set forth an expiration date. This is necessary because most RV lease agreements are month-to-month agreements. After the expiration date, § 9:436(1)-436(5) require the parties to renew the lease for another term in order to avoid any questions about whether the lease remains in force after it expires.
Renewal
If the park wishes to renew the lease, then it should state in the lease agreement that both parties have to agree to renew the lease for it to be renewed. In other words, just because the parties continue to act as though the lease is renewed, does not mean that the lease was automatically renewed.
Think of all the above like a prenup for your RV. It is important to protect yourself before you sign a lease agreement.
Why You Should Consider Leasing an RV
A lot of people might consider buying an RV then renting it out for extra income, whether it’s through a service like Outdoorsy or a peer-to-peer site like Tripleseat. But is that actually the best option? Leasing an RV has a number of advantages for those interested in this popular type of recreation vehicle.
Leasing an RV has a number of benefits for potential RV owners, including the fact that you don’t need to completely exhaust your savings on making a purchase. Moreover, it gives you a degree of flexibility that you wouldn’t have if you purchased an RV outright. Especially for new RV users, it can be a perfect way to find out whether or not an RV is going to be a good fit for you before you make a large investment.
The biggest benefit of leasing an RV is cost, as you’ll be able to avoid your savings being completely wiped out by making a large investment on a vehicle. RVs are a major investment, and by leasing a vehicle you’ll be able to get around some of those costs.
Another benefit of leasing is flexibility. Whether or not you’re absolutely in love with the RV you lease, you’ll have more freedom to upgrade to a newer model in a few years. If you buy an RV, you’ll be more likely to stick with it for a while, especially considering the costs to sell an RV.
Since leasing takes the financial responsibility of ownership away from you for a few years, you can enjoy using it without worrying about maintenance, repairs, etc. Depending on whether or not the vehicle is under warranty, you may be completely eligible for those repairs. And since maintaining an RV can be expensive, leasing will give you a respite from some of the costs.
Utilizing an RV Lease Agreement Template
A lease agreement template is a written form or sample that allows users to understand how a typical RV lease agreement works. Lease agreement templates are placeholders for information that must be filled in before forming the contract. The following is how an RV lease agreement template can be used to create a rental document that meets the needs of the parties.
When a person decides to lease out their recreational vehicle, a lease agreement template can prove helpful. An RV lease agreement is a contract that is between a tenant and a landlord that allows the tenant to rent a personal RV from a landlord in exchange for rent. Several aspects of leases are negotiable and parties need to ensure all the terms are set out properly. A lease that is not customized to the needs of the parties or agreed to by both parties can lead to future conflicts and problems. As such, utilizing a template can remain a blank place holder for the terms of the agreement, without making any legally binding commitments until every term is agreed upon.
An RV lease agreement template offers the advantage of already having the language of a typical lease in place so that each individually negotiated section does not have to be formed from scratch. An RV lease agreement template may already contain specific language regarding repairs and maintenance, the payment of utilities, when the lease begins and ends, the ways in which the tenant can use the RV, and when a parking fee applies. When a lease agreement template is used, all the concessions made by the parties can be written into the template at no additional cost, including the inclusion of pets as part of the lease and the rights a tenant has if a dispute arises. When drafting a lease on a blank sheet of paper, the parties may not be aware of some of the standard practices that can be written into any lease.
Lease agreements can last from a few days to several months in length, depending on the needs of the parties. By using a lease agreement template, parties do not have to worry about forgetting or leaving out some of the language that can help make a lease binding and enforceable. Once all the terms of the agreement make it onto the template, it can be signed and used as a binding legal document.
Legal Issues Surrounding an RV Lease
As with any rental agreement, an RV lease agreement should conform to local laws. There may be ordinances that require specific types of disclosures or other declarations, and these often vary by state. An RV lease agreement should also be written carefully to ensure that it covers all desirable elements and clearly sets out understanding on the part of both landlord and tenant.
Liability and insurance are top concerns for both the landlord and tenant. The landlord is concerned with the actions of the tenant and the tenant is encouraged to insure the personal property within the RV. Since it is a "moving" structure, insurance should cover liability while in transit. It is also advisable to have a policy that could cover damage to property caused while the RV is located on a private lot or in storage, possibly by fire or flood. It is not so common, but possible, that someone could move in behind another person’s car, for instance, and cause damage to the RV while it is parked.
Another potential risk is that of abatement due to natural causes , such as hurricane or flooding. Before signing, the tenant should get a written assurance that the RV will be safe from such acts of nature, or they could ask the landlord to carry supplemental coverage against their loss.
A landlord will want to ensure that no one else is living in the RV without express permission, as many policies require anyone who lives in the RV for more than 60 days to be listed on the insurance policy. However, the tenant should also make sure that the landlord does not plan on using the RV as collateral for another loan, which would leave the tenant unprotected in the event of repossession or suite.
An RV lease agreement is both a real estate lease and an equipment lease, and it must therefore comply with laws covering both. Keeping in mind that the RV is a "moving" structure does set it apart from other real estate leases, as does the fact that many are seasonal rather than annual agreements. Certainly, these leases can be beneficial to both the landlord and tenant, and they need not be burdensome or overly complicated.
Mistakes You Don’t Want to Make
When in doubt, ask an attorney about it. There is no greater risk to someone with an RV business than not having the proper legal documents in place. Lacking a valid contract is the single most dangerous mistake. You have to have a legal agreement to set the ground rules. It protects you and your customer. Businesses and customers don’t always uphold verbal agreements about dividing profits or when payments are due. If everyone does what they agree to under the written contract, it makes for a smoother and better business relationship.
Another common mistake is failing to address damage and repair issues in your RV lease agreement. Ask yourself, how will damages be handled? Will the customer be charged for damages? Was there excessive wear and tear? Will the security deposit need to be refunded or additional charges need to be made to make repairs? What if the customer returns the RV in poor condition? How do you enforce the rules you put in place?
A lesser-known problem is people using an RV for a residence. The term "residence" means "occupying on a continuous basis." Many states won’t allow an RV to be used as a residence on private property – even though "homesteading" laws were passed to prevent such a thing. So, make it clear in the agreement that it is not a residence and may be removed within 30 days. Write in the consequences clearly if the customer doesn’t comply with the set terms.
Some landlords may give customers an RV lease agreement without asking them to sign it. This seems like it would be fine, but this is actually a major oversight. The customer never accepts the agreement when it is just handed to them. They don’t have to agree to the terms. They can say, "I’ve never agreed to this," and there’s nothing you can do about it. Ask the customer to sign and date it in front of you.
We’re all guilty of tearing through contracts quickly. Unfortunately, rushing through a lease agreement can lead to mistakes that cost you big bucks. Read it carefully and make sure it includes every single detail. Make sure everything you want covered is covered. Ensure you’ve used the correct form and answered every question. The most important thing to remember is: the agreement isn’t something you can decide you want to change later. It’s a legally binding contract, so any changes you want must be done via official amendments.
Where to Locate Reliable RV Lease Agreement Templates
One of the best sources for finding reliable templates is legal websites such as Nolo or USLegal, both of which offer a variety of lease agreements for many different types of vehicles, including RVs. These agreements are drafted by professionals and updated regularly to reflect the latest laws and regulations. This can help you avoid legal troubles down the line.
Another great source for RV lease agreement templates is RV dealers or manufacturers . Many will provide a lease agreement template when you purchase an RV, either as an accessory or included in the price of the RV. While it’s important to review the agreement carefully and ensure it will meet your needs, these agreements can help save time and attorney fees.
You can also purchase RV lease agreements from legal software companies such as LegalZoom or Rocket Lawyer, which provide a range of legal documents for different states. Their templates may be less detailed than those provided by legal websites, but they are generally a good value.
