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A lease agreement is a crucial legal contract that outlines the rights and obligations of both landlords and tenants. Without one, landlords risk financial losses, property damage liabilities, and difficulties in collecting unpaid rent. Creating a lease agreement is straightforward, and understanding its fundamentals is essential for effective property management. A residential lease agreement serves as the first line of defense against disputes and outlines how to address issues when they arise. Key components to include in a lease agreement are the property's details, names of the parties involved, and contact information. Having a well-structured lease can facilitate smoother landlord-tenant relationships.