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A lease agreement is a legally binding contract that outlines the rights and responsibilities of both landlords and tenants. Without one, landlords risk significant financial losses, liability for property damage, and difficulties in collecting unpaid rent. Creating an effective lease is straightforward and can help prevent disputes. Essential elements of a residential lease agreement should include details about the rental property, the names and contact information of both parties, and other fundamental terms. This document serves as a landlord's first line of defense, enabling prompt resolution of issues and protection of the property.