Sorry in advance for the lengthy post. And, I acknowledge any advice given on this forum is not financial or legal advice. We are new to biggerpockets.com and have recently purchased a SFH rental a block away from our college student's campus. We bought it with a tenant already in place and he has been very easy to work with. We are in the process of getting leases signed by some other college students to live with my son in the rental unit starting in August 2022. We used the biggerpockets lease form for Texas to simplify things for us and had a property manager review it before sending it to the 3 college students and their parents for review. We have not had any pushback on the lease from 2/3 of the parents but one parent who is a real estate agent sent us a 2-page line item "Review of lease agreement" of everything he feels is wrong with our lease and how or where it contradicts Texas property code and the Texas Tenant Rights Handbook. He is in Alaska by the way. This has raised a red flag for us that maybe this family will be difficult to work with but wanted some input from the community since we are certainly not experienced and there could be issues with the lease even though we used the biggerpockets template. Below are the elements of the lease that he has reacted to.

(E) Rent (including any Additional Rent) is due on the first (1st) day of each calendar month. Any payments paid after the 2nd day of any calendar month shall be deemed late. Any late payments shall be charged a $___50______ late fee for the first day rent is late. An additional fee of $_____20____ per day shall be assessed for each additional day Rent is late, until Rent is paid in full. Notwithstanding the above, the total late fee assessed for any month will not exceed 10% of the total of one month’s rent for the rented premises. All late fees shall be deemed Additional Rent payable by Tenant.

-His concern was that #1 the rent is $450 and that the $50 late fee is already over the 10% limit and #2 "the landlord is not permitted to charge a late fee if the entire amount of rent is paid within 2 full days after the due date". We understand we can charge to a maximum of 12% under texas law and then change the wording to Any payment after the 4th day of the calendar month shall be deemed late. would be allowable under Texas law? Or, do we just leave it as is?

Another issue is the dad's concern about the kids setting up the utilities. He says as the lease is written, "the guys in the house will be responsible for setting up service contracts for the utilities". We were planning all along to help our son set up all the utilities since he is moving in 2 months before the other guys so all basic utilities needed will be already set up before the other guys move in. But the goal was to have them split the utilities when the time comes to pay it and they could just Venmo for the amount. Should we specify in the lease that the utilities will be split equally among the tenants? We did not want to do an all bills paid situation for a 3/2 SFH. The dad suggested doing all bills paid to simplify the situation. Our fear, based on dealing with this guy so far is that for example, if his son comes home for Thanksgiving or Christmas break like college students do and isn't in the house during that time, he will claim his son does not owe 1/4th the utility bill since he was not there the entire time.

Another issue was regarding the "Tenant having examined the property" in the lease. Our lease states

In signing this Lease, Tenant has examined the Premises and certifies that Tenant has not observed mold, mildew or moisture within the Premises, unless otherwise noted during the move-in walkthrough. He states this is not possible unless the lease is signed in August. We thought that the wording unless otherwise noted during the move-in walkthrough covered that but maybe not. Any thoughts?

The dad also had an issue with the following elements of the biggerpockets lease.
Pest control, after the first ten (10) days of the Term of this Lease, shall be the sole responsibility of the Tenant, including, without limitation, prevention and remediation. The dad states in his lease review that "if a landlord intentionally tries to change this duty orally or in your lease a tenant may have a claim against the landlord for actual damages one months rent plus $2,000 and attorney's fees." Why would it be in the biggerpockets attorney-approved lease if it is not legal?

Another issue he wishes to remove entirely from the lease was the following. (B) In the event that Landlord commences legal action against Tenant to enforce any part of this Lease or applicable laws, Landlord shall be entitled to recover all costs and reasonable attorneys' fees incurred by Landlord in connection therewith.

He says under Texas property code, only the prevailing party is entitled to recover attorneys fees. Again, not sure why the biggerpockets template would include something if it were contrary to actual Texas law.

The final issue he has was with the termination clause. We used the template verbatim but he wants "something added to state that the tenant should provide adequate notice to the landlord which may enable the landlord to find another tenant before the current tenant actually moves out." There are elements of termination scattered throughout the biggerpockets template that discuss tenant death or family violence, early termination fee of 1 months rent, but there isn't specifically a defined "adequate notice" defined in the lease. Should this be added and how?

Thanks for reading and any comments appreciated.

Fort Worth, Texas

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