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A lease agreement is a legally binding contract that outlines the obligations and rights of both the tenant and landlord. Without one, landlords risk significant financial loss, including the potential for property damage and difficulties in collecting unpaid rent. Creating a lease is straightforward, and understanding its basics can enhance your effectiveness as a landlord. Key elements of a lease agreement include the property details, the names and contact information of all parties involved, and essential terms of tenancy. Having a lease in place helps prevent disputes and serves as a vital tool in managing issues that may arise during the rental period.