Leasing License Practice Exam

Trade fixtures must be specified in which type of document?

1. Bill of sale

2. Lease agreement

3. Title document

4. Property appraisal

The correct answer is: Lease agreement

Trade fixtures are items that a tenant installs in a rental space to conduct their business. They are considered the property of the tenant and can be removed at the end of the lease term, provided they do not cause damage to the premises. It is crucial to specify trade fixtures in the lease agreement to ensure that both the landlord and tenant have a clear understanding of which items are considered trade fixtures and how they should be handled when the lease ends. The lease agreement serves as the legal document that outlines the rights and responsibilities of both parties, including the handling of trade fixtures. By specifying these items in the lease, the document helps prevent disputes over ownership and removal of the fixtures at the end of the lease term. Additionally, it clarifies expectations and responsibilities regarding maintenance, installation, and potential alterations to the rental property, ensuring a smoother relationship between the landlord and tenant. In contrast, while a bill of sale pertains to the ownership transfer of personal property, it does not specifically address the terms between landlord and tenant. A title document relates to the ownership of real property, not to personal property installations made by a lessee. Lastly, a property appraisal assesses the value of real estate, which does not involve the specifics of trade fixtures. Thus, the lease agreement