Lease Addendum vs. a New Lease: How to Know Which One You Need

If you've ever stared at a lease wondering whether you need a lease addendum vs new lease entirely, this episode is for you. Kevin and I get asked this question often, and honestly, guessing wrong can leave your paperwork not holding up when you need it most.

I'm walking you through the exact test we use to decide whether a quick addendum will do, or whether it's time to start completely over with a new lease. And once you hear what our contractor found in a supposedly empty closet during a routine inspection, you'll understand exactly why this distinction matters so much.

We also get into a couple of our own near misses, including the time strangers tried to rent one of our units with zero intention of ever actually living there. Plus, I'm sharing exactly where Kevin and I get our own leases and addendums from, along with an honest, unsponsored rundown of the landlord software platforms people ask us about most.

Hit play, because by the end of this episode, you'll never have to guess which document you need again.

What You'll Learn in This Episode

•  The simple test we use to decide between an addendum and a brand new lease

•  Why one routine inspection turned into a lease decision we did not see coming

•  The near miss that almost turned one of our own units into a full time Airbnb

•  Where we personally get our leases and addendums from, and what it actually costs

• An honest, unsponsored breakdown of the landlord software platforms people ask about most

Episodes & Resources Mentioned

Episode 32-34: Our Lease and Addendums Masterclass (starts at EP32) — 

Episode 115: Our New Utility Fee Breakdown 

Episode 129: Should You Allow Smoking in Your Rental

Episode 130: Guest Policies — What They Are, Why They Matter, and How to Actually Enforce Them

Episode 22: The Pros and Cons of Renting to Pet Owners 

Episode 61: Fair Housing and Emotional Support Animals (ESAs) 

Episode 108: Navigating Reasonable Accommodation Requests 

Innago: Completely FREE landlord management software

TurboTenant: Great landlord management software for newer landlords

RentRedi: Management Software that syncs with QuickBooks’s Online 

DoorLoop: The best landlord management software for larger portfolios

EZLandlordForms State specific leases and addendums, over 400 forms available!

California Apartment Association Where we get our landlord forms 

Connect with Us: 

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👆 FREE Landlord Forms and Doc’s

🤳Text Us: 650-489-4447

📩Email us at: Stacie@YourLandlordResource.com, Kevin@YourLandlordResource.com 

➡️ Give us a review: Apple or on Spotify or YouTube 

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Transcript

Introduction - Addendum or New Lease?

Stacie 0:00

So we're doing unit inspections, and we're in a unit where only one guy was on the lease. Our contractor, Jim, was checking closets for mold, and in what should have been an empty closet was a closet completely full of women's clothing. Turns out a college friend had been staying there for weeks looking for her own place. And that's kind of the moment when you realize, is this just a guest or is it time to change the lease? So we gave him an ultimatum. She goes on the lease or she has to leave. So today we're breaking down exactly when a quick addendum works and when you need to redo the whole lease.

0:49

Welcome to Your Landlord Resource Podcast Many moons ago, when I started as a landlord, I was as green as it gets. I may have had my real estate license, but I lacked confidence and the hands-on experience needed when it came to dealing with tenants, leases, maintenance, and bookkeeping. After many failed attempts, fast-forward to today, Kevin and I have doubled our doors and created an organized, professionally operated rental property business. Want to go from overwhelmed to confident? If you're an ambitious landlord or maybe one in the making, join us as we provide strategies and teach actionable steps to help you reach your goals and the lifestyle you desire, all while building a streamlined and profitable rental property business. This is Your Landlord Resource Podcast.

Stacie 1:38

Hey, landlords. Welcome back to the Your Landlord Resource Podcast. I'm Stacie, and as always, I'm here with my husband and my co-host, Kevin. And together we run Your Landlord Resource, where we help self-managing landlords operate their properties like the professional business that it actually is. Today we're tackling something that trips up even experienced landlords, and that's knowing when you can simply attach an addendum to an existing lease, and when you actually need to update the whole lease. So

The Simple Test: Addendum vs New Lease

Stacie 2:13

let's start with some definitions. An addendum adds a new rule that was not in the original lease. This adds completely new terms. For example, if your tenant adopts a dog mid-lease and you need to implement a pet policy, you're going to use a pet addendum. The original lease stays exactly as it is. Redoing the lease is just that. It throws the old contract out and starts fresh instead of just tweaking one or two things. You're gonna write an entirely new agreement with new dates, new terms, and new signatures. Every single one of us who owns rental property either has or will have a scenario where a tenant wants to bring in a pet, or you decide to start charging a new utility fee, or a tenant wants to add a roommate. Every one of those moments raises the same question: Do I need a quick add-on document or do I need to redo the lease entirely? Get that decision wrong and the paperwork might not hold up if you ever need it to. So let's get into exactly how to tell the difference.

Kevin 3:26

All right, so let's start with the more straightforward one, the addendum.

When an Addendum is All You Need (Pets, Fees, & Sublet Rules)

Kevin 3:32

An addendum is a separate signed document that attaches to your existing lease. It's legally binding, but it does not rewrite or replace anything that you and your tenant already agreed to. You are not touching what was already signed, you are simply adding something new on top of it. So when would a landlord be using an addendum? The most common reason is a new policy that did not exist when the lease was originally signed. Maybe a tenant asked to bring in a pet halfway through the year, and now you need pet rent, a pet deposit, and some ground rules for care and cleanup. Maybe you're rolling out a new utility fee like we recently just did in Sacramento. Or maybe you're making the building smoke-free for the first time. Now, none of those things existed on day one, so instead of redoing the whole lease, you attach an addendum that spells out the new rule. Addendums are also great for new amenities. So say you just built a storage locker on the property, allowing tenants to rent the space. Or maybe you're assigning someone to a specific parking spot that they didn't have before. An addendum is a simple one-page addition. And they actually work well for guest rules too, like clarifying your policy on long-term guests or subletting. Especially if that was vague in the original lease. We know a lot of landlords who had to use an addendum to add subletting rules when Airbnbs became popular. Tenants would rent out a room in their unit and for some they'd rent out the entire house on Airbnb and they were making a killing financially. This was very popular during COVID, especially with landlords who had very simple leases and didn't address subletting the unit. The thing is though, it put them in a major position with liability. Not to mention if there was any damage. Of course, it ultimately is the tenant's responsibility, but some places were getting trashed by Airbnb guests, and then the tenant would come back and say, "Well, the lease didn't say I couldn't re-rent my place to another party." We actually had people who approached us and wanted to rent out our two bed, two bath unit in Sacramento just to Airbnb it. I mean, think about that. They were going to completely furnish it and then rent it out to different people every week or weekend. They had no interest in living there themselves at all.

Stacie 6:11

Well, at least they were honest about it.

Kevin 6:14

I know, but can you imagine if they weren't? I mean, we have a lease we would have to enforce, and they would just likely walk away, leaving us screwed.

Stacie 6:24

You know, hey, it did give us the idea of doing the midterm rental, and that's worked out very well for us. And sideline, in case you're not aware, most rental property insurance companies do not allow short-term stays. Most allow 30-day minimum stays, as does ours. For Airbnb, there is special short-term stay insurance that you as the owner need to hold on the property to be covered properly for liability and everything else. Okay, so an example we mentioned was when a tenant wants to add a pet. This was for kid two's duplex in Idaho, but he had a couple living in one unit who decided after they signed their lease renewal that they wanted to get a cat, and he allows that. But because they did not have a pet before, a pet addendum was not included in the original lease. So he went on to EZ Landlord Forms, which is his preferred source for state-specific leases, and was able to pull a pet addendum out and personalize it to include the amounts for the monthly pet rent and the non-refundable deposit that he charges, as well as rules about damage, litter box cleanliness, and some other specifics, including the pet name, size, description, and the need for vaccination record documentation. He uploaded that addendum to the tenant portal in TurboTenant, and because he pays for their pro level, he was able to send it out for electronic signature. Bing, bang, boom, done within a day or so.

Kevin 8:02

And here's the other example of issuing an addendum we've experienced. If you've been listening for a while, you know that we recently implemented a utility fee. Now, this fee covers a small portion of the tenants' water that they use, the sewer charges, and their garbage and recycling usage. We used to cover all of that, and it was included in the rent. Now, Stacie and I cover over 50% of the combined bills each month, with the other, I don't know, like 40% being equally divided between all the current tenants. And because most of the tenants had renewed their leases, for a couple of them, we just used an addendum to add this new fee onto their current lease. There were no other changes needed, so an addendum worked great. And if you wanna learn more about why we did this new utility fee, you should give episode 115 a listen, where we talk about what we did and why. We will link that in the show notes for you. The common thread in both those addendums is that we were not changing anything with the lease that had already been signed. We were simply adding something completely new on top of it.

Stacie 9:16

Yeah, exactly. And one quick tip about addendums. Always use the current date for your addendums and reference the original lease by name and the date that it was created so five years from now, nobody is left wondering which document actually governs in the relationship. Okay, so that covers the more straightforward scenario. But

When You Need a Full Lease Redo

Stacie 9:42

sometimes an addendum is not enough, and that's when you're looking at updating the entire lease. Now, let's talk about what would constitute having to completely redo your lease. Changing the timeframe is a very common reason. If you're extending the lease end date or converting someone from a fixed-term lease into a month-to-month agreement, that is changing the very structure of the agreement. It needs to be documented as a full lease update. And then there's another big one, and that's occupancy changes. Adding a new permanent roommate onto the lease is very different from letting someone stay for a week as a guest. Once someone becomes a permanent responsible party on that lease, you want that reflected in the actual lease itself. You know, we've lived through a few of these ourselves. We've told the story a couple times of when we were in the unit, there's only one male on the lease, and when we went in, Jim was inspecting the closets looking for mold, and in the spare room, he found what we've always found was an empty closet filled up with women's clothing. And the room that usually just had an airbed in it was now fully furnished with items that were, well, quite feminine. And listen, we don't judge, but this definitely made us wonder what was going on. So we asked, and we found out that he had a college friend who needed a place to stay for a few weeks while she was looking for a new place. And listen, we're not asses, but we did give him an ultimatum. So we told him she has one more week of staying as a guest, or she has to get out or go on as a roommate. And a couple days later, they decided that she was gonna go on the lease for another year. We also had a family member with a family living in his single-family home rental, and one thing they did not realize when they signed the two-year lease was that the tenant's child would be turning 18 mid-lease. And where that may seem like no big deal, when someone is 18 years of age or older, they should be an active party on the lease. This means that they need to sign every page just like their parents did, which is why a whole new lease needed to be created. And here's one more. We had two roommates who had a one-year lease, and a few months in, one roommate had to move out. Now, the remaining tenant wanted to stay on and absorb all the expenses themselves. And in order to release that one tenant who was moving on, we had to start all over with the lease. And for us, it usually works out to where we're able to get the tenant to agree to another year. So instead of potentially dealing with a lease renewal in just a few months, we were able to extend the lease date out and secure the tenant for longer than it could have been. In every one of those examples, the relationship or the money changed enough that a simple addendum was not gonna cut it. We needed the whole document redone, so that everyone was crystal clear on the new terms. And here's a little test that we use when we're not sure which bucket something falls into. We'll ask ourselves, "If this ended up in front of a judge, would the original lease plus a one-page addendum tell the whole story clearly, or would it take real effort to piece it all together?" If it takes real effort, we're just writing a new lease.

Kevin 13:20

Yeah, and lucky enough for us, we don't come across this very often. But definitely enough to where we need to know what applies to each scenario.

Why Getting This Distinction Wrong Can Cost You

Kevin 13:31

So why does all this actually matter? Because getting it wrong can cost you when it matters most, like Stacie said, when you're in front of a judge or across the table from a tenant who is confused about what they actually agreed to. An addendum's biggest strength is that it preserves everything already in your original lease, your disclosures, your property condition documentation, every clause you've already negotiated. That saves you time because you are not rebuilding an entire document from scratch every time something small changes. But here is the flip side. If you are changing something foundational, like the rent amount or who is actually named on the lease, and you try to force that into a one-page addendum, you can end up with a patchwork of documents that contradict each other. This is exactly the kind of thing that gets picked apart in a dispute. A brand new lease in those cases actually protects you because it clearly lays out every updated obligation for both parties with no ambiguity about which document controls. And regardless of which path you take, get it signed by both parties. An addendum that is not signed does not hold any more weight than a note you just left yourself.

Where We Get Our Own Leases (Associations & Agents)

Stacie 14:55

And before we get into some of the software out there, I wanna be upfront about what Kevin and I personally use. You know, we pull our leases and our addendums from the California Apartment Association. It's a paid membership, and it's not cheap, but it gives you far more than just lease and addendum templates. It's a full library of California-specific rental forms, along with education and industry resources, and it also comes with some legal guidance. So that's really nice to have to bounce a situation and potential solution off of before we get our very expensive lawyer involved. If you're outside of California, most states and many regions have their own state or local rental housing association that offers something similar. So that is definitely worth looking into. And if that's not the right fit for you, another completely legitimate option is paying a real estate agent to draft the lease on your behalf using state-specific real estate association forms. Many agents who work in property management have direct access to those forms as part of their license. Now, beyond

Comparing Landlord Software: Innago, TurboTenant, RentRedi, DoorLoop, & More

Stacie 16:12

associations and agents, we also get asked all the time about the software platforms landlords use to build these documents. And let me just say, we're not going to make this a big sales pitch, but we do wanna walk you through the landscape that includes a few of our landlord software partners, because the honest answer is these platforms are genuinely different from each other. And I know we're always on here pushing our favorite, TurboTenant, but in this situation, we're gonna start with Innago because it's a really good site. First, Innago is completely free. There are no paid tiers at all. Every landlord gets full access to build, customize, and digitally sign leases and addendums, plus state-specific templates without ever having to pull out a credit card. Now, I'm gonna be honest here, and I will say that we have not used Innago ourselves, so we have no idea how many forms they offer or how easily they can be personalized. But they are the only landlord management software that is completely free for all aspects that they offer. You know, just in case you might be interested in checking them out.

Kevin 17:25

Yeah. And on the other end, you have platforms like TurboTenant, RentRedi, and DoorLoop, which all take a bit of a hybrid approach. TurboTenant, which we have used and love, has a free tier where you can create and preview a state-specific lease. But sending it out for electronic signature and building custom addendums requires you to be part of their paid pro plan. Now, Rent Redi and DoorLoop are both paid platforms at their core. You cannot use their software without paying a monthly fee. DoorLoop actually offers a large library of free downloadable lease and addendum templates on their website. But if you want the software to auto-fill your tenant's details and collect e-signatures inside your account, now that requires a paid plan. Rent Redi works similarly. You need an active paid account to build and send documents for signature within their system. Then there is EZ Landlord Forms, which is really a different animal altogether. Instead of being an all-in-one property management platform, it is a document-first legal service. You are paying primarily for a huge, highly customizable library of state-specific forms somewhere north of, I believe it's like 400 of them, and they cover things the bigger platforms just don't touch, like specialty addendums for mold or hot tubs or medical marijuana. Their free tier is pretty bare bones. Basically a skeleton lease with the names rent and deposit. If you want the real protective clauses and the full addendum library, you will want to go with their paid pro option, which is what Kid Two uses for his Idaho duplex. So here's how we would sum it up. If you already have a solid system for collecting rent and handling maintenance, and what you really want is an airtight, hyperlocal legal language, EZ Landlord Forms is worth a look. If you want one platform to handle your leases, your addendums, your rent collection, and your maintenance requests all in one place, something like Innago, TurboTenant, or Rent Redi is gonna serve you better. And to be clear, we will drop links to all of these in the show notes, including our partner links. And just to let you know, we try to recommend tools we genuinely use or vetted ourselves. And one honest note here, we personally do not use TurboTenant to manage our own units, but we have assisted kid two with it and it is genuinely user-friendly. So it's a solid recommendation for newer or smaller scale landlords who want something approachable. Also worth mentioning too, DoorLoop and Rent Redi both sync with QuickBooks accounting software. So if you're already tracking your books there, that's one less manual data entry you have to worry about. And if you'd like to check out any of those landlord management software platforms, we will link them all in the show notes. If you do sign up, even for the free ones, we do get a small referral fee that is of no cost to you. But by using our links and getting us that little amount, you guys, that's huge to us. It really does help us to be able to produce this podcast and to share our experiences with you each week. Think of it as you would in supporting a small local business.

Stacie 21:07

Yeah. You guys, we appreciate, any way that you can support us.

Recap & Related Episodes

Stacie 21:13

So here is the simple gut check for next time something changes mid-lease. Ask yourself one question: Am I adding something new or am I changing something we already agreed to? New policy, new amenity, new guest rule, that is addendum territory. But if you're changing the rent, the deposit, the timeframe, or who is actually on the lease, that is a whole new lease. Whichever one applies, get it signed, keep a copy for your files, and reference the original lease by document name and date so there is never question about which document controls. Now, one thing. We did mention one related podcast episode we have done, but there are several, like our lease and addendum breakdown. You guys, that's a three-part series where we walk through every single paragraph and addendum that's in our lease. We also have two related to animals in your unit. One is the pros and cons of renting to pet owners, and the other is about Fair Housing and emotional support animals, or ESAs. We have one on guest policies, what they are, why they matter, and how to actually enforce them. And one we did recently on if you should allow smoking in your rental. And finally, you never know when life might change for a tenant mid-lease, so we did an episode on navigating reasonable accommodation requests. And we'll link all of those in the show notes for you if you'd like to give them a listen. All right, that's our episode for today. As always, we are very grateful that you guys take the time out of your day to listen to all we have to say about self-managing rental properties. If you enjoyed this episode, would you do us a favor and leave us a kind review of the podcast? Because reviews help others find out that we're here and that we know what we're talking about. If you wanna hear more, follow or subscribe to the podcast so that every week, the episodes are downloaded right to your favorite podcast platform. And we'd love to stay in contact with you. In the show notes, you can find links to all of our free downloads that we offer, ways to sign up for our free newsletter, and the waitlist for our upcoming course on tenant screening. And there's also links to our private Facebook group in there that's just for landlords., Sometimes we dabble in social media on Instagram and Facebook as well as YouTube, so check those out. I think that's about it. Thanks again, and until next time, you've got this, landlords.