Rental Housing Terminology

Posted By: Melissa Canfield Education , Management ,

Washington state’s rules and regulations covering tenants and housing providers have changed in major ways in 2021. With a variety of new processes and regulations being implemented following the end of the eviction moratorium, it can be hard to keep track of terminology in the rental housing industry.

We have defined this terminology below to better inform our members and the housing industry, tenants of our communities and residential property managers.

We encourage our members to use this as a resource and share as necessary to accurately communicate what are often complex topics.

  •  Lease or Rental agreement is a legally binding contract made between a housing provider and a tenant and contains all the terms for renting a residential property for a preset period of time, typically covering a 6 or 12-month rental period.
    • Short-term lease generally refers to a lease with a duration of less than six months.
    • Periodic or indefinite period lease may have a term, but automatically converts to month-to-month at the end of that term and continues in perpetuity.
    • Month-to-month (periodic) lease is an agreement between a housing provider and tenant(s) that establishes occupancy without a specific end date. Each month, the lease automatically renews until either the housing provider or tenant gives proper notice to end the contract.
    • Sublease is the renting of property by a tenant to a third party for a portion of the tenant’s existing lease contract.
    • Fixed term lease (specified term) is a lease that has a defined beginning and ending date and ends on the date specified in the rental agreement. 
  • Security deposit is money paid by a tenant to a housing provider as proof of intent to secure tenancy and may be used to pay for damages caused by a tenant at the termination of the tenancy or returned to the tenant if there are no damages. 
  • Rent is any recurring or periodic payment that is identified in the rental agreement. Rent may include utilities. Rent is not late fees, attorney fees, damages or other nonrecurring fees. 
  • Screening criteria is the minimum qualifications required to rent a property, and may include income and employment verification, criminal history search, previous rental references and personal references. Screening criteria must be provided to applicants prior to conducting any background check. 
  • Income-to-rent ratio is a requirement by the housing provider that the tenant earn a minimum percentage above the monthly rent to reduce the risk of housing instability and rent burden. HUD defines rent burden to mean spending more than 30 percent of household income on housing costs. 
  • Background check is a process a person or company uses to verify that an individual is who they claim to be, and this provides an opportunity to check and confirm the validity of someone's criminal record, rental history, income and employment history. 
  • First in Time (FIT) is a synthetic regulation requiring housing providers to offer tenancy to the first qualified applicant who provides a completed application.  
  • Termination is the process by which a housing provider or tenant exercise rights under the lease to terminate the relationship and the tenant discontinues occupying the premises. 
  • Notice to Vacateis a written notice given by the housing provider to the tenant terminating the rental agreement and requesting the tenant(s) leave the property within a specified time frame. This type of notice is typically given during the end of a lease period, or due to a violation of the lease agreement. 
  • Compliance notice is one of a limited number of written documents required by law to be served when the tenant violates the terms of the rental agreement, community rules or tenant obligations imposed by law, and requires the tenant to either comply with the rental agreement or vacate the property. 
    • 10-day notice to comply is a mandatory notice in the state of Washington to give to tenant(s) when the tenant(s) violate legal obligations other than payment of rent, community rules or non-monetary provisions of the lease agreement.
    • 14-day notice to pay is mandatory notice in the state of Washington to give to tenant(s) when the tenant(s) fails to pay rent as required by the lease.
    • 60-day notice to vacate is a mandatory notice in the state of Washington to terminate a lease agreement when:
      • The tenancy is a fixed term lease;
      • The initial term of the tenancy has existed for more than 6 months but less than one year;
      • The tenant has received four or more notices of violation in a 12-month period.
      • There is another legitimate economic or business reason not specified in law.
    • 90-day notice to vacate for occupancy or sale is used when the housing provider/owner wishes to occupy the premises personally or for their family or remove the housing unit from the rental market by selling the premises.
    • 120-day notice to vacate for demolition, substantial rehabilitation, or change of use is used when the property is being remodeled, converted, or torn down. In some jurisdictions, the housing provider/owner and the city must provide financial assistance to qualifying families. 
  • Eviction is a lawsuit brought in court to enforce the contractual agreement between the housing provider and tenant seeking the return of possession of the property from the tenant to the housing provider because of a violation of the rental agreement. 
  • Just Cause or Good Cause is a synthetic regulation requiring housing providers to identify the reason they are terminating the lease. This can be anything from a failure to pay rent up to illegal activity. 
  • Lease renewal is the process of a housing provider offering and a tenant agreeing to a new or continuation of an existing lease on substantially similar lease terms as the prior period. 
  • Non-renewal of lease is the process of the housing provider declining to offer a lease renewal at the end of an existing lease. 
  • Rental assistance is financial assistance provided on behalf of the tenant to the housing provider that can come from a federal, state or local government, or private or nonprofit agency. A housing provider is required to accept rental assistance when the rental assistance, together with other funds offered, covers the entire balance of rent owed and does not include additional restrictions on the acceptance of rental assistance funds. 
  • Housing provider expenses:
    • Mortgage
    • Utilities (Case-by-case basis)
      • Electric
      • Gas
      • Water
      • Sewer
      • Garbage
    • Insurance
    • Maintenance and repairs
    • Property taxes
    • Property manager fees
    • Bookkeeping and accounting
    • Tenant turnover and vacancies
    • Employee turnover and vacancies

We will continue to provide educational materials that can be used to better inform our members, tenants, and the greater community. Ensuring the language is accurate and these terms are used correctly in the industry will help housing providers avoid confusion and misrepresentation in the future.