Question
nnnnWhich of the following is not a requisite for creation of an undeclared leasehold agreement?
nnnnSelections
nnnnA. Amount of rental payments
nnnnB. That rent payments be made in advance
nnnnC. Length of time the lease will continue
nnnnD. Description of the property
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Answer: B
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5 Keys Summary
nnnn• A valid leasehold agreement requires several essential elements: competent parties, mutual consent, a property description, the rent amount, and the term (length of time) the lease will continue.
nnnn• The lease agreement must define the rental amount and the expected due dates, but it does not specifically mandate that payments must be made in advance for the leasehold to exist.
nnnn• If the lease agreement fails to specify otherwise, rental payments are, by default under law, due at the end of each successive holding period or term, not necessarily in advance.
nnnn• Because the agreement only needs to define the time and manner of payment, the requirement that rent payments be made in advance (Option B) is not an essential requisite for the creation or validity of the leasehold agreement itself.
nnnn• Essential requirements that are requisite include the amount of rental payments, the length of time the lease will continue, and a description of the property.
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