Oregon Residential Landlord and Tenant Act
Your Oregon residential rental lease agreement is governed by the state’s Residential Landlord and Tenant Act so that certain terms need to be included in your lease as well as disclosures. Basic provisions include those relating to rent, late fees, notices, deposits, pets, repairs, conduct of the tenants and lease termination procedures.
All landlords have obligations to their tenants such as providing a habitable residence that has essential services that include:
- Heat and air conditioning
- plumbing and sewage
- Garbage receptacles
- Running and hot water
- Smoke detectors
- Walls, stairs, ceilings and floors in good condition
- Working locks on door and windows
Tenants have responsibilities to keep the premises sanitary, to make minor repairs, notify you of conditions or repairs affecting their health and safety, to not disturb other tenants, obey the law and to adhere to all other lease provisions.
As a landlord, you must also must comply with anti-discrimination laws in housing that prohibit you from refusing to rent to, or treat current tenants differently, based on race, color, creed, gender, religion, marital status, national origin and disability. Some Oregon cities ban discrimination based on sexual orientation, age and source of income.
Application Fees Allowed
You may charge application fees for conducting credit and criminal background checks. These fees must be returned to the applicant if no search was conducted. If you use a screening service, you are required to:
- Advise the applicant that the fee is nonrefundable (or not charge a fee)
- Provide the name and address of the service
- Disclose the information you are seeking
- That the applicant has the right to send a statement to the service if the applicant believes the information is incorrect
- Upon request by the applicant who was denied rental of the unit, you must provide a written statement outlining the reason for the denial
You may deny renting to persons based on their bad credit, criminal history, record of eviction, poor or incomplete references or insufficient income. You cannot deny renting to someone with an arrest record unless criminal charges relating to drug activity, fraud, a person crime or sexual offense are pending.
You may charge a refundable fee to keep the unit available for a certain tenant and to not rent to others while you conduct credit and background checks.
Contents of the Lease – Some are Optional
Your Oregon residential lease agreement should have certain terms and disclosures but you can include optional provisions as well so long as they do not conflict with local, state and federal laws. Also, give a copy of the signed lease to your tenants.
Include the following terms in your lease:
- Name of landlord and property manager who is authorized to manage the property, address where rent is to be paid and where request for repairs are to be directed
- Names of the tenants and other occupants—have the adult tenants sign so all are obligated under the lease
- Description of the premises
- Term of the lease—fixed term or monthly, weekly or yearly
- Amount of rent and how and where it is to be paid, due date and grace period—a late flat fee may be imposed on the 5th day after the due date so long as:
- a daily late fee may be imposed of no more than 6% of the one-time flat fee
- or a fee of 5% of the monthly rent every 5 days beginning on the 5th day
You may request prepaid rent of your tenant at the beginning of the tenancy that may be used to pay for the last month of the lease
- Returned check fees—up to $35 plus whatever the bank charged for check processing
- Security deposit—no limit, no interest required, acknowledgement of receipt is required; return funds within 30-days of tenant vacating unit or send written statement with specific reasons for withholding it—recommend you have a mutual inspection of the premises shortly before or after tenant vacates
- Other deposits—you may charge refundable or nonrefundable fees, if so specified, for cleaning or for the keys to the unit
- Signed, separate statement of the premises’ move-in condition including list of current damages to be given to tenant and signed by tenant after inspecting premises (required if you collect a security deposit)
- Obligations of landlord regarding repairs and maintenance and of services provided as indicated above
- Obligations of tenant as noted above
- Responsibility for utilities—if allocating among different tenants, describe the method used—you may also add a surcharge—advise if utilities paid are directly for the benefit of the landlord or other tenants
- Major appliances that are being provided
- No commercial, business or unlawful use of premises by tenant or conduct that constitutes a nuisance
- Pet clause—a request for a fee may be nonrefundable; indicate types of pets, size and that tenant keep area clean of pet waste (deposits are not allowed for service animals)—may charge up to $50 if provision is violated
- Subletting clause
- Right of entry by landlord to make repairs, inspect and show to future tenants or purchasers or if the tenant has been causing a disturbance or is otherwise violating the lease—24 hours’ notice is required though you may enter immediately if it is an emergency that threatens the safety of tenants
- Notices regarding termination for nonpayment of rent, other lease violations
- Notice for increasing rent—30 days for a monthly lease (may not be for a discriminatory or retaliatory purpose)
- Disclosure of the presence of any lead-based paint or hazards on the property for rental property built before 1978—both landlord and tenant must sign an EPA-approved disclosure form and the tenant provided an EPA pamphlet entitled “Protect Your Family from Lead in Your Home.”
- Automatic renewal provision in a fixed term lease unless tenant gives notice to not exercise the option within a certain time before the lease expires (such as 30-days) but you may choose to terminate the lease by giving notice to the tenant according to your notice provision, which may be 30-days before the lease expires
- If you have 5 or more residential units in a single premises, notify the tenants of the opportunity to recycle
- Disclose whether smoking is allowed in particular or limited areas or that no smoking is permitted anywhere in the premises
- Disclose if the leased premises is located in a 100-year flood plain
Prohibited Lease Terms
Be sure that your lease complies with local ordinances as well as state law and do not include provisions that alter or waive rights granted to tenants. Some prohibited provisions include:
- Waiver of right to sue landlord for neglecting duties or obligations under the lease, ordinances or law
- Taking a lien or security interest on the tenant’s personal property
- Prohibiting tenant from joining a tenant’s union
- Terminating the lease without proper notice or procedures
- Self-evicting tenant or without a court order
- Waiver of any section of the law regarding security deposits
- Requiring tenant to vacate if a victim of domestic violence
Security Deposits in Oregon
You may charge whatever you wish as a security deposit though it is prudent to charge no more than one or two months’ rent. State law does not require you to deposit the funds in a separate account or to pay interest to the tenant.
After accepting the tenant’s deposit, provide a move-in checklist of the current condition of the unit and of any damages. Have the tenant inspect the premises and then sign the statement or indicate other damages upon which you mutually agree. Try to resolve any differences.
Before the tenant vacates, provide a check-out list and review the damages. If there is a dispute over what constitutes ordinary wear and tear or whether you or the tenant caused the damage and you cannot resolve it, then you may need a judge to decide.
Security deposits must be returned 30-days after the tenant vacates or send a written, itemized statement of the damages found and its cost.
Termination of the Lease
Fixed term leases expire on the date indicated. You can include an automatic renewal clause but be sure it has a date by which the tenant must notify you of an intention to vacate, usually 30-days before the lease expires. If you want to change any terms such as the rent, you must advise the tenant before the lease expires that a new lease agreement will have to be signed. You can opt to have the lease automatically renew for another year or so, or simply let it become monthly. You can increase the rent with a 30-day notice.
For monthly leases, both tenant and landlord can terminate with 30-day notices. If the tenant has resided on the premises for more than one year, you must give 60-days’ notice to terminate. Weekly rents require 10-day notices to terminate. No reason need to be given by either party for these circumstances.
For nonpayment of rent, you have two options regarding notice to the tenant:
- Wait 8 days after the rent is due and then serve a 3-day notice to terminate the lease or pay the rent due within this time
- If in your lease, wait 5 days after the rent is due and serve a 6-day notice to terminate or pay the rent due within this time
Be sure the notice specifies who owes the rent, how much is owed, date and time it is due, date the notice was served and a certificate of service. Also, you may accept partial payment so long as you state in writing that acceptance does not waive eviction proceedings.
If the rental agreement is week-to-week, the notice period for nonpayment of rent is 72-hours.
For other lease violations, you have to give a 30-day notice to terminate but allow the tenant 14-days to remedy or cure the breach. However, if the tenant had a previous violation within the past 6-months, you can give either a 30-day notice with 14-days to cure or a 10-day notice with no opportunity for the tenant to cure the breach.
If you find the tenant has an unauthorized pet, you can give 10-days’ notice to have the pet removed. If the pet caused serious damage or harmed someone, the notice may be 24-hours. Should the pet return, serve the notice again with no opportunity for the tenant to cure the breach.
For outrageous acts, or if the tenant subleases to someone else without your consent, you can serve a 24-hour unconditional notice to terminate the lease. Outrageous acts include criminal activities such as drug dealing, prostitution and assault of other tenants or intimidation.
Under the Servicemembers’ Relief Act, a tenant who is a member of the Armed Forces or uniformed services can terminate a lease early if the tenant receives deployment orders to move more than 35 miles from the premises for more than 90 days and a copy of the orders is given to the landlord. This also applies if the tenant is ordered to reside in government-supplied quarters. The tenant is required to give 30-days’ notice if practical and to pay for the remainder of that month’s rent but with no further obligations under the lease.
Domestic Violence Exception
Tenants or children of the tenant who are victims of domestic violence, sexual assault or stalking within the past 90 days may terminate any lease early without penalty so long as the tenant can produce a police report or order of protection accompanied by a verification statement signed by the tenant and qualified third person such as an attorney, police officer, victim’s advocate or licensed health care professional. The tenant need only serve a 14-day notice to vacate if all these conditions are satisfied.
Also, if the tenant verifies status as a domestic violence victim, then you must comply with any request by the tenant to change the locks on the unit though the cost is borne by the tenant.
Under serious conditions such as lack of heat or running water or electricity, the tenant may give you 24-hours’ notice to terminate the lease though the tenant must first have given you written notice and an opportunity to repair or provide the service.
Duty to Mitigate
If your tenant vacates with rent still owing, you have a duty to take reasonable steps to find another tenant or you may not be able to claim all of the rent due and owing under the lease from the vacating tenant. You can use the same criteria to find a new tenant and at the same rent or higher and you may charge the absent tenant for any costs you incur to advertise or re-let the unit.
Withholding Rent Allowed in Oregon
There are circumstances where your tenant may withhold rent if the tenant has requested that you make certain necessary repairs within a reasonable time and you have not done so. The repairs do have to be material or affect the tenant’s health or safety. Most tenants are advised to have a building inspector review the repair situation first and then send the report to the landlord.
If your tenant withholds rent and you sue for eviction, the court could have the rent deposited into court and force you to make the repairs.
Deduct and Repair for Essentials
The conditions for deducting a portion of the rent and doing the repairs by the tenant personally is that the repairs be no more than $200 and that an essential service such as hot water, electricity, a non-working refrigerator or any other condition that poses a risk to the tenant’s health, sanitation, safety or shelter be involved. The tenant does have to show that you deliberately refused to do the repairs or were grossly negligent.
Oregon residential lease agreements can be complex and contain many terms that are either required or that protect you from damages and harm to your leased property. Be sure your lease complies with all local ordinances and with state law or you could be forced to pay damages. Consult with an experienced Oregon landlord/tenant attorney if you have any questions or concerns about your lease as well as your obligations and responsibilities.