AZ - LEASES IN ARIZONA EXAM QUESTIONS ANSWERED CORRECTLY LATEST UPDATE 2026

AZ - LEASES IN ARIZONA EXAM QUESTIONS ANSWERED CORRECTLY LATEST UPDATE 2026 An inheritable estate with absolute ownership - Answers Freehold estate Aka non-freehold estate; grants possession, but not title, for a limited period of time - Answers Leasehold estate The lessor's right to reclaim possession of the property at the end of the lease term - Answers Reversion All agreements, written, oral, or implied by law, and valid rules and regulations that embody the terms and conditions concerning the use and occupancy of a dwelling unit and premises - Answers Rental agreements (as defined in AZ law) The tenant pays a fixed rent and the landlord pays all operating expenses; most common type of lease used in residential rentals - Answers Gross lease The tenant pays on top of the rent one or more of the following expenses: property taxes, property insurance premiums, or maintenance costs - Answers Net lease A lease in which the tenant is required to pay rent plus taxes, insurance, and maintenance costs - Answers Triple net lease (NNN) The base rent, the nets, utilities, and janitorial services are included in one lease rate, based on price per square foot - Answers Full-service lease A lease where the base rent is kept the same for the duration of the lease - Answers Fixed lease Includes rent that has scheduled increases that are set to take place throughout the term of the lease at predetermined intervals (e.g., annually) - Answers Graduated lease The lessee pays a base rent, but the rent increases or decreases to correspond with a change in the landlord's cost of ownership (i.e., taxes, insurance, and maintenance) - Answers Escalated lease Rent either increases or decreases depending on some economic indicator, such as an inflation index - Answers Index lease Appraisals take place at pre-determined intervals—typically every three to five years—and the rent is adjusted according to an agreed-upon percentage of the prior rent - Answers Reappraisal lease The tenant pays a base rent, plus an additional charge based on a percentage of the tenant's gross sales or income (usually in retail property rentals, like shopping centers and malls) - Answers Percentage lease Lease of land that typically involves a long period of time (50 to 99 years); the lessee usually owns improvements and pays ground rent for the land - Answers Ground lease Protects a valid lease from termination in the event of mortgage foreclosure - Answers Nondisturbance clause In the case of foreclosure, obligates the tenant to attorn (agree to be tenant) to any successor—the lender, or any subsequent purchaser the lender may sell the property to - Answers Attornment clause Stipulates that the tenant will be provided with specific services for an additional rental fee - Answers Services included clause When the scheduled rent is lower than the market rent; benefits the tenant - Answers Positive leasehold interest The difference between the market rent and the scheduled rent at the time of an appraisal - Answers Deficit rent When the scheduled rent is higher than the market rent; benefits the landlord - Answers Negative leasehold interest The amount that a scheduled rent exceeds the market rent - Answers Excess rent Aka face rent; the amount of rent named in the lease agreement - Answers Contract rent Any money earned by a resource (for example, land) that exceeds the amount that's economically necessary to keep the resource producing - Answers Economic rent The obligations, or money owed, to someone else (often a company or type of lender) - Answers Liabilities When a tenant vacates a property without notice and before the lease terminates - Answers Abandonment Series of HUD-funded housing assistance programs that are administered on the state level - Answers Section 8 A house or unit in a condominium, cooperative, or timeshare that is also a transient public lodging establishment or owner-occupied residential home offered for transient use - Answers Vacation rental/short-term rental Actual eviction: - Answers The physical removal of the tenant, accomplished by legal process. Assignment: - Answers The substitution of tenants, putting the responsibility for the lease contract in the new tenant's hands (although it doesn't fully relieve the former tenant from liability should the new tenant fail to pay); requires landlord's written permission. Constructive eviction: - Answers A situation in which the tenant is prohibited from quiet enjoyment of the premises and vacates. * In such cases, the tenant is evicted for all practical purposes because enjoyment of the premises is not available. Covenant: - Answers An agreement or promise made between the parties. Estate at sufferance: - Answers A type of possession in which a tenant stays after the right to possess has terminated. Estate at will: - Answers A type of leasehold estate in which the duration of the lease is unknown at the time it is created. Estate for years: - Answers A fixed termination type of lease that may be for a day, week, month, year, several years, or any definite period of time. When the specified date occurs, the lease terminates automatically. Holdover tenant: - Answers A tenant who refuses to leave after the expiration of a lease. Lease: - Answers A contract that transfers possession for consideration. Leasehold estate: - Answers The legal relationship between the parties who sign the lease. Grants possession, but not title, to the tenant, and is for a limited period of time. Lessee: - Answers Tenant Lessor: - Answers Landlord Option to renew: - Answers The right of a tenant to renew a lease upon the expiration of a lease period (seen frequently in commercial leases). Periodic estate: - Answers Involves possessory interest that's automatically renewed at the end of each period specified in the lease (e.g., month-to-month). Quiet enjoyment: - Answers Tenant's right to enjoy the property without being dispossessed or trespassed upon. Security deposit: - Answers A sum provided by a tenant to a landlord to cover extraordinary expenses or unpaid rent when a tenant vacates. Self-help eviction: - Answers Illegal eviction in which the landlord has taken matters into his own hands and evicts the tenant without using legal procedures. Sublease: - Answers An agreement for a new occupant to live in the premises and pay rent to the former tenant, who pays the landlord. * Requires landlord's written permission; doesn't relieve the former tenant from liability. Lessee vs. Lessor When talking about rentals, most people use the terms "tenant" and "landlord." On your pre-licensing exam, however, you'll probably see the terms "lessee" and "lessor" instead. To keep them straight, notice the "or" in lessor and landlord. To reinforce this, match lessee and lessor to their more well-known terms. 1) Tenant 2) Landlord - Answers 1) Lessee 2) Lessor Lease vs. Leasehold The terms "lease" and "leasehold estate" are easily confused. However, based on the studying you've done, you should have no problem matching the terms with their descriptions. 1) The contract that allows a tenant to live on the property 2) A right of possession for a limited period of time - Answers 1) Lease 2) Leasehold estate A lease is a contract that pertains to the leasehold estate. Estate from Period-to-Period - Answers This leasehold estate is periodic (e.g., six months, month-to-month, week to week), with a written agreement aka leas that automatically renews itself for successive tenancy unless one party terminates. This is also an inheritable leasehold estate. The period involved may be any negotiated period of time. This is also known as a "periodic tenancy". Example Fred has a barber shop in a commercial building. He has a one-year lease that automatically renews unless either Fred or the landlord terminates it. Estate for Years and Estate from Period-to-Period - Answers When there's no ending date for a lease, but there's an agreed-upon term, this is known as a periodic tenancy. A month-to-month lease is a type of estate from period to period. With a periodic tenancy, the owner or landlord and tenant agree to certain rights and responsibilities for the stated periods, but they don't specify an ending date, so this is an unspecified period of tenancy. Estate for Years vs. Estate from Period-to-Period Now that you've seen several types of leasehold estates, let's test your knowledge. Sort the terms based on whether they're relevant to a tenancy for years or a periodic tenancy. 1) The leasehold continues for a certain period, then automatically ends. 2) The tenant is required to leave when the agreed-upon period is up. 3) The lease automatically renews, month-to-month or year-to-year, for example. - Answers 1) Estate for years 2) Estate for years 3) Estate from period-to-period Estate at Will and Estate at Sufferance - Answers An estate at will can be terminated by either party with proper notice. Further, this type of leasehold estate isn't inheritable. That means if either party to the lease dies, the lease terminates. An estate at sufferance, on the other hand, occurs when tenants continue to occupy property after their lease expires. If the landlord continues to accept rent, however, that tenancy changes to estate at will on a month-to-month basis. The landlord could also choose to evict the estate at sufferance tenants. Estate at Will vs. Estate at Sufferance Sort the following terms based on whether they are relevant to tenancy at will or tenancy at sufferance. 1) Both parties must give notice to terminate the lease agreement. 2) The lease agreement terminates upon the death of either party. 3) The tenant's previously lawful possession continues without permission. - Answers 1) Estate at will 2) Estate at will 3) Estate at sufferance Renewing a Lease Aimee has leased her three-bedroom townhome for two years, and been quite happy there. Her lease automatically renews at the end of each month, which is known as a ______. - Answers Periodic estate This describes a periodic estate, which is automatically renewed at the end of each period specified in the lease (e.g., month-to-month) A Hairy Issue Harry's tenant is very angry, and leaves the house she's been renting from him a complete disaster. He's had to spend $3,000 just to clean it up. He asks her to pay for the damages, but she refuses, so he has to pay for all of the clean-up out of his own pocket. His losses could have been mitigated if he'd required a(n) ______ as part of the original lease. - Answers Security deposit A security deposit ensures the landlord isn't left with extraordinary expenses or unpaid rent when a tenant vacates. Sublease vs. Assignment A sublease and an assignment are very similar, but they're not interchangeable. Consider this example: Mark accepts a new job across the country and needs to move out of his apartment before his lease is up. He can't afford to pay rent for two places at once, so he finds someone else, Betty Sue, to move into his old apartment. Now read through each scenario and then match the term to its scenario. Scenario 1: Betty Sue agrees to take over the property in place of Mark. She pays rent to Mark, who then pays the landlord. Mark is technically still responsible for the lease. Scenario 2: Betty Sue agrees to take over the property in place of Mark. The lease is legally transferred from Mark to Betty Sue, but if Betty Sue doesn't pay the landlord, Mark may still be responsible for the rent. - Answers Scenario 1 - Sublease Scenario 2 - Assignment A sublease is an agreement for a new occupant to live on the premises and pay rent to the original tenant, whereas an assignment is the substitution of tenants, putting the responsibility for the lease contract in the new tenant's hands. Eviction By Any Other Name You're almost done with this vocabulary-laden section. Let's cover just a few more terms. Read through each scenario and then match each term with its example. Scenario 1: A tenant stops paying her rent. The landlord goes through the legal process to remove the tenant, including serving proper notices and enlisting the aid of the local sheriff. Scenario 2: An apartment building is overrun with rats. The tenants have called the landlord multiple times with no response. One tenant chooses to move out because she can no longer enjoy living on the property. - Answers Scenario 1 - Actual eviction Scenario 2 - Constructive eviction Maisie is Hazy (on the Details): Can You Help Her? As a new landlord, Maisie's a little hazy on some of the details about Arizona leases. Can you help her out? Read the following statements and determine whether they're true or false. 1) All Arizona leases must be written. 2) Even though Arizona rental agreements don't have to be written, the parties to a written agreement must follow the same rules as those to an oral agreement or one that's implied by law. 3) If a written lease is used, the landlord must provide a signed copy of it to the tenant. 4) If a written lease is used, the tenant isn't required to sign it. - Answers 1) False 2) True 3) True 4) False Landlord Maisie Signs New Tenants Maisie has just signed a one-year written rental agreement with new tenants, Jill and Jerry Jodhopper. After signing it, Maisie gives the Jodhoppers a copy of it. They sign it and give her a copy of the agreement that's been signed by both of them. Under Arizona law, Maisie thinks she also needs to give her new tenants written notification that the Arizona Residential Landlord and Tenant Act is available on the Arizona Department of Housing's website. Is this true or false? - Answers True Lazy and the Lease Provisions Maisie's not the only landlord in her family. Her ne'er-do-well brother Lazy has also decided that he's going to buy some property to rent out after he sues a local fast food company for over-salting his fries. He invests in a rundown four-family flat in the city and sticks a sign in the yard. Before long, he has found some tenants and they've signed rental agreements. Read each of the following statements and determine whether the lease provisions he's included are acceptable or prohibited by law. 1) Grace's lease includes the provision that she will waive some of her rights as provided under the Arizona Landlord and Tenant Act. 2) Gilbert's lease includes a provision that attorney fees may be awarded to the prevailing party if there is a court action between him and Lazy. 3) Grimsby's lease has a provision that says he'll pay a penalty if he calls the police to the property in an emerg - Answers 1) Prohibited 2) Acceptable 3) Prohibited 4) Prohibited A lease that includes prohibited provisions is automatically void and unenforceable. If a landlord purposely uses a lease with provisions that he knows are prohibited, the tenant may recover actual damages sustained up to an amount that doesn't exceed two months' periodic rent. Maisie and Lazy Debate Landlord Access Maisie and Lazy meet for coffee one morning. Talk turns to their respective landlord-ing duties. Lazy makes several statements that cause Maisie concern, but to be honest, she's not 100% up to speed on landlords' ability to access to their tenants' rental units. Which three of these statements are correct? 1) The landlord can pretty much come and go from the tenant's unit, provided it's between the hours of seven a.m. and 11 p.m. and he gives the tenant 24 hours' notice. 2) The landlord must give the tenant two days' notice of intent to enter the tenant's unit, except in an emergency or when it's not practical to do so. 3) A tenant can't unreasonably keep the landlord from entering the unit for doing inspections, making repairs, and showing the unit to prospective buyers. 4) In an emergency, the landlord doesn't need the tenant's permission to enter the unit. 5) Once the landlor - Answers 2) The landlord must give the tenant two days' notice of intent to enter the tenant's unit, except in an emergency or when it's not practical to do so. 3) A tenant can't unreasonably keep the landlord from entering the unit for doing inspections, making repairs, and showing the unit to prospective buyers. 4) In an emergency, the landlord doesn't need the tenant's permission to enter the unit. Deposits The security deposit serves as a landlord's informal "insurance" against the tenant damaging the property or another breach of the lease agreement. Arizona landlords may only charge a maximum of _________________________ for a security deposit. - Answers one-and-one-half months' rent If any fees or deposits are nonrefundable, the landlord must state that in writing. If a fee or deposit isn't specifically designated as nonrefundable, it must be ________________. - Answers refundable Within ______ days (not including weekends and legal holidays) after the tenancy's termination and the tenant moving out of the dwelling, and at the tenant's demand, the landlord must give the tenant an itemized list of all deductions together with the amount due and payable to the tenant, if any. - Answers 14 days If the tenant refuses or fails to pay rent owing and due, the landlord may place a lien on and may seize as much of the tenant's personal property (located on the premises) as necessary to secure payment of the rent (provided the property isn't exempted by law). If the rent isn't paid and satisfied within ________ days after the landlord seizes that personal property, the landlord may sell that seized property as provided in the Arizona Landlord and Tenant Act. - Answers 60 days Who Pays What? Maisie remembered her first young tenants. The brothers, who'd just moved out of their parents' home for the first time, were shocked to realize that necessities like electricity, gas, and water weren't free. She'd stifled a grin when she explained gently that someone had to pay for these items. Which lease provision spells out who pays for what, how much he or she pays, and other details on this topic? - Answers Utilities The Maximum Security Deposit Allowed in Arizona Under Arizona law, what is the maximum amount of a security deposit a landlord can accept? - Answers An amount equal to one-and-a-half-months' rent So if landlord Maisie charges $500 monthly rent, then she must not charge her tenants more than a $750 security deposit. Condition of the Rental Dwelling It's common for a landlord to require the tenant to inspect the property when moving in, noting any existing damage to the property. When the Arizona tenant moves into the property, the landlord must provide that tenant with which three of the following? 1) An itemized list of the costs of each appliance and amenity provided under the rental agreement 2) A written notice to the tenant that he or she may be present at the move-out inspection 3) A move-in form to specify existing damages to the unit 4) A signed copy of the lease - Answers 2) A written notice to the tenant that he or she may be present at the move-out inspection 3) A move-in form to specify existing damages to the unit 4) A signed copy of the lease When the time comes for the tenant to move out, if he or she requests to be present at the move-out inspection, the landlord must notify the tenant about when this inspection will occur. Money Matters in Arizona Leases Let's review some more information about leases in Arizona.