5 lease clauses that cost tenants thousands (and how to catch them)
Last updated July 16, 2026 · 6 min read
A friend of mine opened a store. A few months in, the air conditioning died, and fixing it cost her thousands. When she asked the landlord to cover it, he pointed to a line in the lease: she was responsible for the HVAC, and she’d had 30 days after move-in to test it and report problems. She never noticed that clause when she signed.
That’s the thing about leases — the clause that costs you the most is rarely the rent. It’s a sentence buried on page nine that quietly moves risk onto you. Here are the five that catch tenants out most often, in plain English, with what to look for and what to ask for instead.
1. Who pays for repairs — and is there a deadline to report problems?
Many leases, especially commercial ones, put maintenance of big-ticket systems (HVAC, plumbing, roof) on the tenant, and some add a short window to inspect and report defects. Miss that window and a problem that surfaces later becomes yours, no matter how expensive.
Watch for: Phrases like "tenant accepts the premises as-is," "tenant is responsible for all maintenance and repairs," or "tenant must notify landlord of any defects within 30 days."
Ask for: A landlord warranty that major systems are in working order at move-in, a cap on your repair liability, and removal of any short inspection deadline (or extend it to 60–90 days).
2. Does the lease renew automatically, and how much notice do you owe to leave?
Auto-renewal clauses roll you into another full term unless you give written notice by a specific date — often 60 to 120 days before the end. Forget, and you can be locked in for another year.
Watch for: "This lease shall automatically renew for successive terms unless either party gives written notice at least ___ days prior."
Ask for: A calendar reminder for the notice date the day you sign, and ideally a shorter renewal term or a simple month-to-month holdover instead of a full auto-renewal.
3. Can the rent rise without a ceiling?
Rent escalation clauses let the landlord raise rent each year. The problem is an uncapped one — tied to an index or "market rate" with no upper limit — which can jump far faster than you budgeted.
Watch for: "Rent shall increase annually by the greater of 5% or CPI," or any escalation with no stated maximum.
Ask for: A fixed annual increase, or a cap (e.g. "no more than 3% per year") so your largest fixed cost stays predictable.
4. Are you personally on the hook if the business can’t pay?
A personal guaranty makes you individually liable for the lease even if you signed as an LLC. If the business fails, the landlord can come after your personal savings, and "joint and several" liability means any one guarantor can be chased for the whole amount.
Watch for: "The undersigned personally and unconditionally guarantees all obligations," or "jointly and severally."
Ask for: No personal guaranty, or a limited one — capped at a few months’ rent, or a "good-guy guaranty" that ends once you surrender the space in good standing.
5. What does it cost you to leave early or transfer the lease?
Early-termination and assignment clauses decide whether you can get out or hand the lease to someone else. One-sided versions charge steep penalties to leave while giving the landlord sole discretion to block any transfer.
Watch for: "Tenant may not assign or sublet without landlord’s consent" (with no "not to be unreasonably withheld"), plus large early-termination fees.
Ask for: An assignment right where consent "shall not be unreasonably withheld," and a defined, reasonable early-termination option.
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Review your lease freeFrequently asked
What are the most important clauses to check before signing a lease?
Repair and maintenance responsibility, automatic renewal and notice periods, rent escalation, any personal guaranty, and early-termination or assignment terms. These are where tenants most often lose money.
Can I get out of a lease clause I already signed?
Sometimes. Some terms are negotiable at renewal, some may be unenforceable depending on your jurisdiction, and a landlord may amend a clause in writing. Reviewing the exact language and your local law is the first step — and for high-stakes leases, a qualified attorney.
Do I need a lawyer to review a lease?
For a major commercial lease or personal guaranty, qualified counsel is worth it. For a fast first pass — understanding what you’re agreeing to and what to negotiate — a side-aware review tool can flag the risky clauses in a couple of minutes so you walk into any lawyer conversation prepared.
This guide is general information, not legal advice, and Initialed AI is not a law firm. Lease law varies by location. For a major commercial lease or a personal guaranty, consult a qualified attorney.