Modernizing Rental Agreements With an Electronic Lease

Are you considering electronic lease agreements for your rental business? Discover how an online lease agreement can streamline your rental process, saving you time and money while providing a secure and easy-to-use solution. In this guide, we'll explore the benefits, walk you through how they work, and share how to choose the right solution for your needs.

By
Nichole Stohler
|
Last Updated
March 19, 2024
Modernizing Rental Agreements With an Electronic Lease

Signing a lease agreement can now be as simple as a few clicks on your smartphone or laptop. Electronic leases, often referred to as e-leases, streamline a key step in the overall rental journey, meaning that you no longer have to scramble to find a printer, deal with lost documents, or decipher illegible handwriting.

Online lease and rental agreements are changing the way landlords and tenants approach the lease signing process. They offer convenience, efficiency, and security, allowing tenants and landlords to review and legally sign a binding lease from the comfort of your home or while on the go.

As the real estate industry evolves, e-leases are quickly becoming the preferred choice for forward-thinking property owners and renters. We'll cover how these lease agreements work and how to evaluate the best solution for your business below.

What is an electronic lease?

An electronic lease, or e-lease, is a legally binding rental agreement that is created, signed, and stored entirely in digital form. Instead of physical pen-and-paper signatures, electronic leases rely on a legally binding electronic signature, which is a digital representation of intent to sign a document.

Benefits of electronic leases

Electronic leases aren't just about going paperless; they improve the entire leasing process altogether. Here are some of the ways everyone benefits from online lease and rental agreements:

Accessibility and efficiency

Digital lease agreements are easily accessible, making it convenient for tenants to review and sign their lease online. This is particularly ideal for those with busy schedules, frequent travelers, or people who live far from the rental property they're moving into.

Electronic leases also offer the ability to automatically populate negotiated fields within the agreement, saving time and reducing the risk of errors with manual data entry.

Automation

The document signing process can also be automated, with parties receiving notifications and reminders to sign the lease agreement electronically, minimizing the chances of delays or missed deadlines.

Convenience

Online leases allow you to complete the entire lease signing process remotely, eliminating the need for physical meetings, printing, and mailing documents back and forth. Landlords and tenants can easily scroll through the lease agreement, make changes, and sign the document from the office or while on the go without having to coordinate schedules or travel to specific locations.

Eco-friendly

Using a lease agreement online is also a great way to reduce your environmental footprint. By going digital, you're not just saving paper; you're also cutting down on the energy and resources used to produce, transport, and store all those paper documents. Plus, with electronic signature technology, there's no need for ink cartridges or toner, which can be hard to recycle and often end up in landfills.

Security

Electronic leases are stored securely in the cloud, reducing the risk of loss or damage that can happen with physical documents. This centralized storage means landlords and tenants can access the most up-to-date version of the completed lease agreement from anywhere.

Accessing a lease agreement online eliminates the need to keep track of multiple copies and the risk of discrepancies between different versions of the lease.

Easily renewable

When it's time to renew, e-leases make the process simple. Landlords can send the renewal agreement through the online platform, and tenants can review and sign it in just a few clicks.

Having the original lease and past renewals stored securely online is also a huge plus. It makes it easy for everyone to reference the current terms and make any necessary updates for the new lease period.

An online lease agreement also allows for quick and easy modifications to any part of the previous agreement during the renewal process. For instance, if the landlord wants to update the pet policy, change the rent amount, or add new clauses, they can easily do so within the digital lease platform. The tenant can then review these changes and decide whether to accept the new terms or negotiate further.

Verifiable

Electronic leases provide a full audit trail, which can be helpful in case of disputes or legal proceedings. Every action taken during the lease signing process, including changes made, comments added, and signatures obtained, is automatically recorded and timestamped. This digital trail serves as evidence and can help resolve any potential conflicts or misunderstandings.

Electronic vs. digital signatures

Electronic signatures and digital signatures are both used in modern document management systems, but they serve distinct purposes and operate differently.

  • Electronic signature: An electronic signature refers to any method used to sign a document electronically. This can include typing a name, scanning a handwritten signature, clicking an "I accept" button, or using a mouse to sign on a touchscreen.
  • Digital signature: A digital signature uses security techniques to verify the authenticity and integrity of a document. Digital signatures provide a higher level of security and confirmation compared to simple electronic signatures. They guarantee that the document remains unaltered after signing.

How does electronic lease signing work?

Now that we've explored the convenience of electronic lease signing, here are the fundamental steps that make this process possible.

Step 1: Uploading the lease document

The landlord uploads the lease agreement to the electronic signature service platform. This platform serves as a central location for managing and accessing all lease-related documents.

Step 2: Signature fields

After uploading the lease document, the landlord or property manager adds signature fields to the appropriate locations within the tenant lease agreement document. These fields indicate exactly where each party involved in the lease needs to provide their electronic signature.

Step 3: Specifying signatories

The landlord or property manager provides the electronic signature service with the parties' email addresses or other contact information in the lease agreement. This step verifies that the appropriate parties receive notifications and access to the e-lease document for review and signing.

Step 4: Customizing signature settings

Many electronic signature services offer customizable settings to tailor the signing process to specific requirements. These settings may include specifying the order in which signatories need to sign, setting up reminders for overdue signatures, and determining the authentication methods required for each signatory.

Step 5: Sending the lease for signing

With the signatories specified and the signature settings configured, the electronic signature service sends a secure link or email to each designated party. This link provides them with access to review and electronically sign a lease agreement.

Step 6: Signing the lease

Each party accesses the lease document through the link or email and reviews the agreement. Once satisfied, they electronically sign the document using their preferred method, whether that's typing out their name, writing a signature with a mouse, or using a certificate-based digital signature.

Step 7: Accessing the signed document

After all parties have successfully provided their electronic signatures, the fully executed e-lease agreement is available for download or access within the electronic signature service's platform.

Choosing an electronic signature service

If you're ready to modernize your tenant lease agreements by signing online, how do you choose the right service that meets your needs? Let's cover the key areas you should consider when evaluating your options:

  • Security and compliance: Verify that the solution complies with relevant laws and regulations. Look for features like encryption, authentication methods, and secure storage to protect sensitive lease information.
  • User experience: Prioritize platforms with an intuitive interface and streamlined workflows for landlords and tenants. Features such as customizable templates, automated notifications, and guided signing processes can enhance usability and efficiency.
  • Customization options: Choose a solution that allows for flexible customization of lease agreements to accommodate specific terms, property requirements, and legal regulations. Evaluate the ease of use of editing tools and template libraries to verify compliance with local laws.
  • Integration capabilities: Assess whether the online lease solution integrates smoothly with your existing property management systems or other software tools. Integration can streamline data management, automate workflows, and reduce manual errors.
  • Scalability and support: Select a solution capable of scaling as your portfolio grows. Look for providers offering responsive customer support, comprehensive training resources, and scalability options.
  • Workflow automation: Seek solutions that offer automation around the lease agreement process, such as templates for common lease agreements. Azibo's online e-sign tool for executing leases electronically offers real-time status updates and centralized storage for executed leases.
  • Cost and value: Consider the pricing structure and overall value proposition of the solution. Evaluate factors such as subscription fees, additional charges for features or support, and the return on investment in terms of time and resource savings.
  • Ease of implementation: Assess the ease of transitioning from traditional paper-based processes to digital leases with the chosen solution. Look for providers offering implementation support, training resources, and clear guidelines for an easy transition.
  • Customer reviews: Research user reviews, testimonials, and industry reputation to check the reliability, performance, and satisfaction levels of the online lease solution.

Azibo's electronic lease solution

Azibo's electronic lease solution offers the creation of legally binding lease agreements, which are tailored to each U.S. state's laws and provide secure storage for executed leases. With its user-friendly interface, you can easily create custom lease agreements using a step-by-step guide and tailor them to include your specific terms and addendums.

As an all-in-one platform, Azibo offers more than just electronic leases. You can also use the solution to manage every aspect of your rental business, including:

Azibo is a cost-effective and competitive solution, with most features available for free to landlords. State-specific lease agreements are priced at just $29.99, and Azibo boasts an excellent 4.5-star rating on Trustpilot, reflecting its commitment to customer satisfaction and ease of use. To provide a smooth onboarding experience, Azibo provides training resources as well as complimentary email and phone support.

Incorporating an electronic lease rental agreement into your business practices

Electronic leases are a modern and efficient alternative to traditional paper-based agreements. By leveraging them, landlords and tenants can enjoy a more convenient and secure leasing process.

As more landlords and tenants experience the undeniable benefits of digital solutions, the popularity of electronic leases continues to soar. Choosing the right electronic signature service and confirming compliance with legal standards helps landlords streamline their processes and stay ahead of the curve.

Embracing e-leases is a strategic move you can make in today's rental market, which demands efficiency and adaptability for continued success.

Digital lease agreement FAQs

What is a digital tenancy agreement?

A digital tenancy agreement is a legally binding contract for renting property, created and signed electronically, often using digital signature technology for convenience and efficiency.

How do I sign a PDF lease?

You can sign a PDF lease electronically by using digital signature software or tools provided by PDF editing software, allowing you to add your signature digitally directly onto the document.

Is it safe to sign lease electronically?

Yes, signing a lease electronically is generally safe, especially when using secure platforms or digital signature technology that ensures document integrity and signer authentication.

Nichole Stohler

Nichole co-founded Gateway Private Equity Group, with a history of investments in single-family and multi-family properties, and now a specialization in hotel real estate investments. She is also the creator of NicsGuide.com, a blog dedicated to real estate investing.

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