Lease Contract in the Philippines: What Must Be Written

A contract of lease is your written agreement with the tenant: what is being rented, for how much, for how long, and under which rules. In the Philippines the soundest contracts are clear on seven things — who the parties are, which unit, how long, how much, deposit and advance, bills and repairs, and how the tenancy ends. Get those right and there is less to argue about and less to chase.

Plenty of landlords rely on a friendly understanding, or on a one-page contract copied off the internet. That holds until the first disagreement. Here is what belongs in it.

Who and what the contract covers

The parties

Write the full name of the lessor (you or the owner) and of the lessee (the tenant). If a company is renting, name the company and the person authorized to sign for it. If you are a caretaker or agent rather than the owner, make sure you hold written authority from the owner.

• Full names and addresses of landlord and tenant
• Which valid ID was presented (note the type; the full number does not need to sit in the contract)
• Contact number and email for notices
• The people who will live in the unit, for a residential lease

The unit and the term

Describe the premises exactly: address, unit number, floor, parking slot if included, and anything that comes with it (aircon, fridge, bed). An inventory list signed by both sides is worth attaching.

For the term, write the start and end dates. Say how renewal works: automatic, or a new contract? And how many days before the end each side must say whether they are renewing or leaving?

How much is the upa, and how is it paid?

This is the most argued-over part, so make it detailed.

• The monthly rent
• The due date (say, the 5th of the month) and whether there is a grace period
• Payment method: cash, bank transfer, GCash, or post-dated checks
• The late penalty, if any, and how it is computed
• A bounced-check charge, if a check is dishonoured
• How and when the rent may be increased on renewal

If the unit falls under rent control, there are limits on increases and on deposit and advance. See our guide to rent control in the Philippines and to raising the rent.

Deposit, advance, and the bills

Write the security deposit and the advance rent as separate items, because they do different jobs. Advance rent pays for a specific month. The deposit is security against damage and unpaid bills, returned at the end of the tenancy. Our guide to security deposit and advance goes further.

For utilities, answer these in the contract:

• Who pays for electricity, water, internet and LPG?
• Does the unit have its own meter, or is it shared?
• Who pays condo or HOA dues?
• How many days after move-out is the deposit returned, and may part of it be held for final bills?

Our guide to splitting electricity and water covers the arithmetic when meters are shared.

Repairs and house rules

The usual split: small repairs from daily use (a blown bulb, a sink blocked by the tenant) fall to the tenant, while structural work, the roof and the main pipes fall to the landlord. What matters is that the split is written down.

Include the house rules, or attach them as an annex: pets, smoking, visitors, running a business from the unit, and compliance with condo or HOA rules. We have a separate guide to house rules.

What if the tenant leaves early?

That is what the pre-termination clause is for. State:

1. How many days of written notice are required (30 or 60, typically)
2. Whether there is an early termination charge, and how much
3. What happens to the deposit and the advance
4. The grounds on which the landlord may end the contract, such as non-payment or breach of the house rules

Remember that even with such a clause, ejecting a tenant still has to follow the proper process. No padlocks, no cutting the power.

Signatures and the notary

Landlord and tenant should sign every page, or at least the last page together with the annexes. Two witnesses are better. For a term longer than a year, or whenever you want the stronger document, have it notarised — a notarised contract becomes a public document. See our guides to notarising a lease and to e-signatures.

Before signing, run this checklist:

• Are the names and the address spelled correctly?
• Do the figures in numerals and in words match?
• Are the annexes complete (inventory, house rules)?
• Does each party have a copy?

How MagpaUpa helps

MagpaUpa generates a contract from Philippine starter templates for residential, bed space or dorm, commercial, land, and general leases. Your lease terms — late penalty, grace period, deposit return days, notice periods, pre-termination — are set once and merged in, with a rent-control warning where it applies. The tenant can e-sign with an audit trail, and there is a print-ready copy with a notarial acknowledgment page. Try MagpaUpa.