Electronic-Lease: Everything You Need To Know To Set It Up Safely

The use of digital technologies for business transactions has grown rapidly in recent years. This is also the case in the field of property management. In this context, the electronic lease has gained enormously in popularity in the management of real estate rentals.

If the electronic lease has many advantages and makes life easier for landlords, it is still necessary to know its limits as well as the conditions of validity surrounding it. Discover its advantages, its risks and the best practices to set it up and secure it effectively.

The Advantages of the Electronic Lease in Rental Management

The digital lease offers many advantages simplifying the lives of tenants and owners of rental properties, both residential and commercial.

Here are a few:

Quick and easy electronic signature.
Reduced document processing and storage costs.
Better communication and transparency between the parties regarding the rental agreement and building regulations.
Time saving thanks to the speed of the electronic signature (you will easily see who has signed his lease or not.)
Reduction in the use of paper and therefore respect for the environment.
Ability to store and manage electronic leases centrally and securely.

As you can see, the electronic lease is a faster solution than the traditional paper lease allowing rental managers to be more efficient and productive. Thanks to the electronic signature, you will no longer need to send documents (such as the lease, the building regulations or the renewal notice) by bailiff, registered mail or to meet the tenants in person to sign the lease.

The Conditions of Validity of an Electronic Lease and Electronic Signature

Bail électronique et signature électronique avantages

In Quebec, the validity of the electronic lease is based on compliance with certain legal conditions stipulated by the TAL. Among other things, there are several criteria to be met in terms of the document’s authenticity and integrity. It is important to comply with these requirements to ensure that the electronic lease is valid and enforceable before the TAL in the event of a dispute.

The information provided by the Tribunal Administratif du Logement concerning the document’s integrity.

According to the TAL, for an electronic lease to be considered valid, it must comply with the applicable legal provisions:

The electronic document must be authentic, unaltered and clearly identifiable;
Parties must also have access to the electronic document and to any other relevant information in connection with the electronic lease;
Parties must give their informed consent to use the electronic lease.

The TAL also recommends keeping a copy of the electronic lease for a period of 5 years.

The Risks and Limits of Electronic Leasing in Quebec

As with any electronic document, there are certain risks associated with the use of digital lease. It is important to take into consideration that the latter could be vulnerable to hacking. The confidentiality and security of the parties’ data could then be compromised.

It should also be noted that there may be errors or omissions when transmitting or receiving the lease form, which may compromise the lease validity and authenticity.

The Implementation of this Management Tool

Switching to electronic lease management for your leases can seem daunting, but it can be done quite easily.

Here are some tips to get there:

Choose a reliable and secure electronic signature system. There are several electronic signature platforms that meet the legal requirements applicable in Quebec. This is the case, for example, of docusign, eZsign or signsquid.

If you don't already have a lease template, create a standardized template, or use the one provided by your property management software. The latter must include all the mandatory and optional clauses provided for by law. It must also be clear and easy to understand for tenants.

Inform the tenants of your digital transition and the implementation of the electronic signature and explain to them how it works. You will also need to explain to them how to access the lease and how to save it.

If necessary, consult a lawyer to ensure that the lease complies with the applicable legal provisions.

Most property management software offers the electronic version of the lease, as well as templates for renewal notices or building regulations. In addition, they integrate electronic signature tools. These different elements make it possible to reduce manual management and double entry, not to mention a better use of your time and resources.