Michigan Lease Mistakes That Can Cost Landlords in Court
/Insights from a recent REIA discussion on landlord leases and eviction strategy
If you own a rental property in Detroit or anywhere in Michigan, your lease is one of the most important legal documents you have. Unfortunately, many landlords unknowingly include clauses that judges simply won’t enforce. In some cases, one problematic clause can cause a judge to disregard the entire lease.
In this post, we’ll go through six key topics about landlord leases that every Michigan rental property owner should understand. These insights come from a recent discussion about how courts actually interpret lease agreements, late fees, damages, and eviction notices.
When landlords end up in court, many assume that if something is written in their lease, the judge will enforce it. Unfortunately, that’s not always the case. Judges often interpret leases based on what they consider reasonable and equitable, and that can work against landlords if the lease language isn’t carefully written.
Understanding how courts view lease provisions can help landlords avoid costly mistakes and improve their chances of success in court.
Broker Monique Burns for Detroit Rental Properties
Hi, I’m Monique Burns, a real estate broker specializing in Detroit rental properties. My husband Pat and I work with investors who buy distressed properties, renovate them, and either rent or sell them.
Because we’ve renovated hundreds of rental properties and work closely with investors, property managers, and attorneys, we often hear real-world insights about what actually happens when landlords go to court.
Today I want to share several important lessons landlords should know about lease clauses and eviction procedures.
Possible Eviction Discount for Hanna & Jarbo
If you found Hanna & Jarbo from my video, ask them if you can have the REIA of Oakland discount and let them know you found them from Monique Burns. They did not offer the discount to my viewers, but it may still work.
1. One Bad Clause Can Void the Whole Lease
A major takeaway from the discussion is that one problematic clause in your lease can create serious problems in court.
In theory, contract law allows judges to strike out a single invalid clause while leaving the rest of the contract intact. However, in practice, many district court judges may take a different approach.
If a judge finds part of your lease problematic, they may decide to disregard large portions of it and instead rule based on what they believe is equitable. This can put landlords at a disadvantage, especially if the lease contains aggressive or poorly written provisions.
This is why it’s so important that leases be clean, consistent, and legally compliant from the beginning.
2. What Is Considered Normal Wear and Tear in Michigan?
In Michigan, “normal wear and tear” refers to the natural deterioration that happens when tenants live in a property over time. Examples may include worn carpet, minor scuffs on walls, loose door handles, or faded paint.
However, the line between wear and tear and tenant damage is often subjective. For example, some judges may consider broken mini blinds normal wear and tear, while others may allow landlords to charge for replacement depending on the circumstances.
Because Michigan law does not give a precise definition, landlords should carefully document property condition with move-in photos, inspection reports, and repair invoices to support any deductions from a security deposit.
3. Lease Clauses to Avoid
Certain lease clauses tend to raise red flags with judges.
Examples include:
Clauses requiring tenants to pay actual attorney fees
Daily late fee penalties
Clauses making tenants responsible for major structural repairs like roofs or HVAC systems
Courts often view these provisions as unreasonable because landlords are generally responsible for maintaining habitability, including essential systems like heating and hot water.
Instead of trying to push aggressive provisions, many experts recommend keeping leases clear, concise, and legally reasonable.
How Much Can Michigan Landlords Charge for Late Fees?
Michigan law does not set a specific dollar limit for late fees. Instead, courts generally expect late fees to be reasonable.
Many attorneys and property managers suggest keeping late fees around 5% of the monthly rent, although some landlords use creative lease structures, such as offering early-payment discounts instead of traditional late fees.
Additionally, some district courts — including areas like Grand Rapids, Midland, and East Lansing — have historically been reluctant to enforce high late fees and may only allow $35.
Because enforcement can vary by court, landlords should avoid aggressive late fee structures that judges may reject.
4. A Late Fee Loophole
One interesting strategy discussed was a late fee workaround used by some landlords.
Instead of charging a late fee, the lease lists a higher rent amount but offers a discount for paying early.
For example:
Lease states rent is $1,200
Tenant receives a $300 discount if rent is paid before the first of the month
If rent is late, the tenant simply loses the discount.
This effectively creates a late penalty without explicitly calling it a late fee. While this strategy hasn’t been heavily tested in court, some landlords have used it successfully.
5. Biggest Mistakes Landlords Make in Their Leases
One of the biggest mistakes landlords make today is copying lease language from multiple sources.
With tools like Google and AI, it’s easy to piece together a lease from different templates. However, this can create documents that are inconsistent, poorly structured, or even contradictory.
Judges often notice when leases appear to be copy-and-paste documents with mismatched language or formatting.
Instead, a lease should read as if it were written by one consistent author and should avoid unnecessary length. In many cases, a well-written 7- or 8-page lease is better than a confusing 25-page document.
What Is a Notice to Quit in Michigan?
A Notice to Quit is the first legal step in the eviction process. It informs a tenant that they must either:
Pay the rent owed
Fix a lease violation
Or move out within a specified number of days
In Michigan, the most common notice is a 7-day Notice to Quit for nonpayment of rent.
If the tenant does not comply with the notice, the landlord can then file a formal eviction lawsuit in district court.
6. Free Notices to Quit
Another interesting point discussed was how Hanna & Jarbo will send Notices to Quit for free.
These notices are the first legal step in the eviction process and can often be generated quickly through automated systems. Landlords only pay once the eviction process actually begins.
When a Notice to Quit comes from a law firm on official letterhead, it can carry more weight with tenants and sometimes encourages them to resolve the situation before eviction proceedings start.
Hanna & Jarbo’s service is available at:
Final Thoughts
For landlords, the lease is the foundation of your relationship with tenants and your protection in court. Poorly written clauses, inconsistent language, or aggressive provisions can weaken your position if a dispute arises.
By understanding how courts interpret leases and focusing on clear, reasonable, and legally sound agreements, landlords can significantly improve their chances of success.
If you invest in Detroit rental properties or Michigan real estate, staying informed about how leases work in practice—not just in theory—is one of the best ways to protect your investments.