Watch Out for These Prohibited Lease Provisions

Answer

Landlords sometimes include clauses that overstep legal boundaries, but certain lease provisions are outright unenforceable under federal or state law. Recognizing these illegal clauses helps tenants avoid unfair terms and protects landlords from disputes.

Here are common examples of illegal lease clauses you may encounter:

• Waiver of Right to Habitability
  A term stating the tenant gives up the right to safe, livable conditions (e.g., “Tenant accepts property ‘as is’ and waives any repair claims.”) Local codes and the Implied Warranty of Habitability cannot be waived.
• Service of Process Restrictions
  Any clause preventing a tenant from suing or requiring out‑of‑state litigation violates due process. Leases can’t block a tenant’s access to small claims or housing court.
• Excessive Late Fees
  Charging late fees far above state caps (often 5–10% of rent) amounts to an unlawful penalty. Many states limit late charges to a flat dollar amount or a modest percentage of monthly rent.
• Automatic Forfeiture of Security Deposit
  Clauses that let the landlord keep the entire deposit for minor damages or normal wear and tear ignore state statutes governing deposit deductions and required accounting.
• Shifting All Liability to Tenant
  Language holding a tenant responsible for the landlord’s negligence or structural defects (“Tenant assumes all risk of property failure”) won’t stand up in court.
• Non‑Refundable Fees Disguised as Deposits
  Labeling move‑in fees or pet fees as “security deposits” but refusing to return them—even if the unit is spotless—can violate state deposit laws.
• Discrimination or Occupancy Limits
  Provisions that restrict occupancy based on familial status, national origin, religion or other protected categories breach the Fair Housing Act. Likewise, overly strict guest or co‑tenant rules may conflict with local ordinances.
• Mandatory Unlimited Attorney’s Fees
  Requiring the tenant to pay all of the landlord’s legal fees—regardless of outcome—is generally unenforceable unless the tenant actually breaches the lease in a way that triggers fees under state law.

While many statutes overlap, specifics vary by state—some cap late fees at \$25 or 5% of rent, others limit security deposit amounts to one month’s rent. Tenants are recommended to verify local landlord‑tenant laws or consult a tenants’ rights organization (for example, your state’s housing department website).

Before signing a lease, carefully review each clause and, if anything seems abusive or unclear, it’s advisable to consult a licensed attorney or a local housing authority. Proper scrutiny now can prevent costly disputes later.