{"id":31030,"date":"2020-04-20T11:04:28","date_gmt":"2020-04-20T05:34:28","guid":{"rendered":"https:\/\/enterslice.com\/learning\/?p=31030"},"modified":"2020-11-19T15:59:02","modified_gmt":"2020-11-19T10:29:02","slug":"a-brief-overview-on-rental-agreement","status":"publish","type":"post","link":"https:\/\/enterslice.com\/learning\/a-brief-overview-on-rental-agreement\/","title":{"rendered":"A Brief Overview on Rental Agreement"},"content":{"rendered":"<h2 class=\"wp-block-heading\">Introduction<\/h2>\n\n\n\n<p class=\"has-drop-cap\">If a person is planning to rent out a <a class=\"glossaryLink\"  aria-describedby=\"tt\"  data-cmtooltip=\"&lt;div class=glossaryItemTitle&gt;Property&lt;\/div&gt;&lt;div class=glossaryItemBody&gt;Property refers to the legal designation of ownership over valuable items or assets held by an individual or a business. This ownership grants the holder certain legal rights to use, consume,(...)&lt;\/div&gt;\"  href=\"https:\/\/enterslice.com\/learning\/terms\/property\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'>property<\/a> or if someone is planning to let out a property on lease, then they must have an understanding of the rent agreement. A <strong><a href=\"https:\/\/enterslice.com\/rental-agreement\"><em>rental agreement<\/em><\/a><\/strong> is an important document containing the terms and conditions of the contract between the owner of the property and a person who is willing to have temporary possession of the property. It is highly recommended to have a legally binding contract like a rent agreement in order to secure one&rsquo;s property-related rights and interests.&nbsp; In this article, we shall have a basic understanding of rent agreement, its importance, and the essential inclusions in a rental agreement. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Meaning of Rental Agreement<\/h2>\n\n\n\n<p><strong>A rent agreement is a legally binding\nin writing contract between the owner of the property called the Landlord and\nthe person who desires to take possession of the property for a temporary\nperiod called the Tenant<\/strong>. The rent agreement lays down the terms and conditions upon\nwhich the property is given. The agreement has legal importance, and both the\nparties would be bind to the agreement once the document is signed. A rent\nagreement must be closely scrutinised and properly read before signing the\ndocument. The rules and the clauses in the document should be carefully read in\norder to avoid any future conflict.<\/p>\n\n\n\n<p>The\nrental agreement identifies the parties to the contract, the property, the\nterm, and the amount of rent. It is usually for a period of 11 months. The\nterms of the agreement are managed and regulated under the contract law. The reason\nfor renting a property could be for various purposes like for residence,\nstorage space, property for business purposes, or any other commercial\npurposes, government use, etc.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Importance of Rental Agreement<\/h2>\n\n\n\n<p>Many\nof us may have faced some kind of friction when we have either rented a\nproperty or taken a property on rent. It may sometimes affect the relationship\nbetween the parties. Therefore having a rental agreement beforehand can make\nthings much simpler. <strong>A rent agreement is\nof prime value as it fosters the relationship between the landlord and the\ntenant, and most importantly, it protects the rights and interests of the\nparties.<\/strong> A rental agreement is beneficial to landlord in terms of\nprotection to the property, and it is also vital for the tenant as it will\nprotect the tenant from the unlawful demands of the landlord.<\/p>\n\n\n\n<p>A\nrent agreement also plays the role of informing others regarding the ownership\nof the property. It is like legal evidence that can safeguard the landlord from\nfuture legal disputes. The owner of a property may require a legal document\nthat protects him in case of a dispute from the other party, especially when\ndealing with a large asset like a house. One important thing to note while\nmaking a rental agreement is that one must not settle for an oral rent\nagreement because such an agreement is not bound by the law. Hence one must\nalways look to insist on a written agreement.<\/p>\n\n\n\n<div class=\"read\"><p><b>Also, Read:<\/b> <mark><a href=\"https:\/\/enterslice.com\/learning\/lease-agreement\/\" target=\"_blank\" rel=\"noopener noreferrer\">Sample Format of Lease Agreement India<\/a><\/mark>.<\/p><\/div>\n\n\n\n<h2 class=\"wp-block-heading\">What are the contents of a Rental Agreement?<\/h2>\n\n\n\n<p><em>Some of the common inclusions in a rent agreement are provided below:<\/em><\/p>\n\n\n\n<ul><li><strong>Occupants name<\/strong><\/li><\/ul>\n\n\n\n<p>The name of the occupants of the agreement must be mentioned\nclearly in the rent agreement. It gives clarity regarding the person involved\nin the agreement and avoids any unnecessary issues. <\/p>\n\n\n\n<ul><li><strong>Term of the tenancy <\/strong><\/li><\/ul>\n\n\n\n<p>The term of the tenancy is also a vital aspect of a rent\nagreement. It ensures that the person occupying the property vacates the place\nwithin the due time period or to prevent them from unlawfully taking possession\nof the property. Mentioning the duration of tenancy ensures that the landlord\nof a property doesn&rsquo;t unlawfully force the tenants to vacate the place before\nthe time period mentioned in the rent agreement. Therefore, it benefits both\nthe landlord as well as the tenant. <\/p>\n\n\n\n<ul><li><strong>Rent Amount<\/strong><\/li><\/ul>\n\n\n\n<p>The agreement should also mention the rent amount. The amount\nof the rent and the due date for payment must also be specified. It may also\nmention the grace period for making payments and penalties for late payment of\nthe amount specified in the agreement. It will ensure that both the parties\nfollow the stipulations expressed, and none of the parties try to make unlawful\nmoney demands.<\/p>\n\n\n\n<ul><li><strong>Details with respect to\nmaintenance cost<\/strong><\/li><\/ul>\n\n\n\n<p>The agreement should contain the details regarding the cost\nof maintenance during the tenancy period. The tenant or the landlord may bear\nthe expenses related to the maintenance.<\/p>\n\n\n\n<ul><li><strong>Explicit permissions and\nrestrictions <\/strong><\/li><\/ul>\n\n\n\n<p>The agreement must lay down the access and the restrictions\nto the facilities on the premises. It must mention the details about the\nfacilities that can be used by the tenant like the swimming pools, security\nsystem etc. Things like leasing and restrictions must be mentioned clearly.<\/p>\n\n\n\n<ul><li><strong>Termination of the\nagreement<\/strong><\/li><\/ul>\n\n\n\n<p>The rental agreement should mention the methods of terminating\nthe agreement before the expiry date or the term of the agreement. It may also\ncontain charges for the same, if any.<\/p>\n\n\n\n<ul><li><strong>Security Deposit<\/strong><\/li><\/ul>\n\n\n\n<p>The security deposit should be mentioned in the rental\nagreement, and it must be signed by both the parties, thereby assenting to the\nclauses specified in the agreement. In this way, both parties will be\nprotected. The tenant will be protected from the unlawful financial demands of\nthe landlord, and the landlord can be protected by way of security deposit in\ncase the tenant leaves the property without paying off the rent amount. The\ndetails of the account where the security deposit is held should also be\nspecified.<\/p>\n\n\n\n<ul><li><strong>Notice period and Renewal<\/strong><\/li><\/ul>\n\n\n\n<p>The notice period and the renewal must be specified in the\nagreement along with the date, and it should be signed by both the parties.<\/p>\n\n\n\n<ul><li><strong>Details of the amenities<\/strong><\/li><\/ul>\n\n\n\n<p>The agreement may contain the details of all amenities in the\nproperty, just be on the safe side. It may be mentioned with the conditions in\norder to prevent any financial loss or damage.<\/p>\n\n\n\n<ul><li><strong>Signature<\/strong><\/li><\/ul>\n\n\n\n<p>The parties to the agreement must sign the rental agreement,\nin the end, stating that they accept all the clauses mentioned in the agreement\nfailing which it may lead to legal action and penalties.<\/p>\n\n\n\n<p>&nbsp;The above-mentioned clauses must be included\nin every rent agreement. One must carefully go through the rent agreement\nbefore signing it. Both parties must be fully aware of the minutes of the\ndocument. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What are the rights of the parties involved in a Rental\nAgreement?<\/h2>\n\n\n\n<p>The\nparties to the agreement have certain rights that can be exercised by them\nduring the continuation of the agreement. A tenant has the right to complete\nprivacy within the rented area. The tenant has the right to reside in the\nproperty, and he or she cannot be removed unless there has been any\ncontravention to the terms and conditions mentioned in the agreement. Apart\nfrom this, there are a few countries where the landlord must put the security\ndeposit in a bank account and must provide the interest on such amount to the\ntenant. <\/p>\n\n\n\n<p>The\nlandlord or the owner of the property also has some rights, restraining the\ntenant from accessing certain premises of the property and can set out\nconditions for using loud music, smoke, etc. in the area. The landlord may or\nmay not allow pets in his or her property. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Why are most Rental Agreements of 11 months?<\/h2>\n\n\n\n<p>You\nmay have noted that most of the rent agreements are for 11 months period. Did\nyou ever wonder why is it so? Sometimes even the landlord or the tenant may\nalso not know the reason. <strong>The rent\nagreements are usually signed for 11 months to avoid stamp duty and other\ncharges. The registration of the lease agreement is compulsory in case the\nleasing period is for more than 12 months, according to the Registration Act,\n1908.<\/strong> Stamp duty and registration fee must be paid if an agreement is\nregistered. So in order to avoid payment of such charges, most tenants and\nlandlords agree mutually to not register the rent agreements. If one wants to\nregister a lease, then, in that case, both the parties can agree to share the\ncosts associated with it.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Points to note in a Rental Agreement<\/h2>\n\n\n\n<p><em>The following things must be kept a check on in a rent agreement:<\/em><\/p>\n\n\n\n<ul><li>In case your rent agreement is not negotiable, then one must\ncheck a clause in the agreement that may have a lock-in period, which means\nthat the tenant shall not be allowed to vacate the premises before the\nmentioned time period. It can be checked for in the agreement if you don&rsquo;t want\nto get stuck. <\/li><li>If a person wants to rent out his house further, then it is\nadvised to check the subletting clause as every landlord may not allow for the\nsame.<\/li><li>A tenant must carefully read the clause mentioning the\nmaintenance costs and other charges. This must be done to prevent the landlord\nfrom fooling the tenant to pay additional maintenance money.<\/li><li>An agreement must be checked for the smallest detail, like\nthe mode of payment and the rate of increase in the rent amount very carefully.\nIt is the basic yet fundamental part of an agreement.<\/li><li>The clause mentioning repair work to the property must be\ncarefully read in order to avoid spending money on repair works.<\/li><li>Another important aspect of a rent agreement is the\nverification of the tenant. Before a landlord rents out his property to a\ntenant, police verification must be conducted of the tenant in order to check\nthe background of the tenant. It shall prevent any unlawful activity in the\nproperty. It is not only important to safeguard one&rsquo;s property but also to\nensure the safety of the neighbours. This is mandatory, and if proper\nverification is not conducted, then it may lead to criminal liabilities under\nrelevant sections of the Indian Penal Code.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">How is a Rent Agreement executed?<\/h2>\n\n\n\n<p><strong>The following conditions are fulfilled in order to execute a rental agreement validly:<\/strong><\/p>\n\n\n\n<ol><li>The legal document should\nbe printed on a stamp paper of relevant value.<\/li><li>The agreement must be\nsigned by both landlord and the tenant.<\/li><li>The document should be\nattested by two witnesses with their names and place of residence.<\/li><li>In case the duration of\nthe agreement extends beyond 11 months, then the rent agreement must be\nregistered at the office of the sub-registrar after paying the registration\nfee.<\/li><\/ol>\n\n\n\n<h2 class=\"wp-block-heading\">Rental Regulations<\/h2>\n\n\n\n<p>Laws on rent control have been passed by the Indian <strong><a href=\"https:\/\/en.wikipedia.org\/wiki\/State_government\"><em>state Governments<\/em><\/a><\/strong> to deter the landlords from charging excessively from the tenants and also to safeguard them from sudden evictions. Various laws have been proposed by the government that will state a particular rent that would be charged by the landlords. To keep a check on arbitrary hikes, the state governments shall be empowered to put a cap on rent rates. Currently, the laws provide for the maximum rental rate and lays down the circumstances in which the tenant can be evicted.&nbsp; <\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Conclusion<\/h2>\n\n\n\n<br><div class=\"shadow1\">A rental agreement is a crucial legal document that must be carefully read, and each clause of the document must be properly attended to, which we sometimes ignore. To avoid any future disputes by landlords or the tenants, the agreement should be thoroughly examined before being signed, and its clauses must be followed by both the parties. The rent agreement not only provides legal protection to the parties but also entitles them to various rights under the contract.<\/div> \n\n\n\n\n<div class=\"read\"><p><b>See Our Recommendation:<\/b> <mark><a href=\"https:\/\/enterslice.com\/learning\/rental-agreement-format\/\" target=\"_blank\" rel=\"noopener noreferrer\">Sample Format of Rental Agreement<\/a><\/mark>.<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"<p>Introduction If a person is planning to rent out a property or if someone is planning to let out a property on lease, then they must have an understanding of the rent agreement. A rental agreement is an important document containing the terms and conditions of the contract between the owner of the property and [&hellip;]<\/p>\n","protected":false},"author":35,"featured_media":31033,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[2840],"tags":[1920],"acf":{"service_id":"285"},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v14.6.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>A Brief Overview on Rental Agreement - Enterslice<\/title>\n<meta name=\"description\" content=\"we shall have a basic understanding of rent agreement, its importance, and the essential inclusions in a rental agreement.\" \/>\n<meta name=\"robots\" content=\"index, follow\" \/>\n<meta name=\"googlebot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta name=\"bingbot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/enterslice.com\/learning\/a-brief-overview-on-rental-agreement\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"A Brief Overview on Rental Agreement - Enterslice\" \/>\n<meta property=\"og:description\" content=\"we shall have a basic understanding of rent agreement, its importance, and the essential inclusions in a rental agreement.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/enterslice.com\/learning\/a-brief-overview-on-rental-agreement\/\" \/>\n<meta property=\"og:site_name\" content=\"Enterslice\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/enterslice\" \/>\n<meta property=\"article:published_time\" content=\"2020-04-20T05:34:28+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2020-11-19T10:29:02+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2020\/04\/A-brief-Overview-on-Rental-Agreements.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"670\" \/>\n\t<meta property=\"og:image:height\" content=\"352\" \/>\n<meta name=\"twitter:card\" content=\"summary\" \/>\n<meta name=\"twitter:creator\" content=\"@enterslice\" \/>\n<meta name=\"twitter:site\" content=\"@enterslice\" \/>\n<!-- \/ Yoast SEO plugin. -->","authorName":"Ashish M. 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He is a creative thinker and has a great interest in exploring legal subjects.","postViews":500,"readingTime":7,"nextPost":{"id":31038,"slug":"gst-audit-documentation-requirements-and-procedure"},"prevPost":{"id":31022,"slug":"covid-19-startup-assistance-scheme-csas-in-india"},"featuredMediaUrl":"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2020\/04\/A-brief-Overview-on-Rental-Agreements.jpg","postTerms":"General Agreement","_links":{"self":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/posts\/31030"}],"collection":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/users\/35"}],"replies":[{"embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/comments?post=31030"}],"version-history":[{"count":0,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/posts\/31030\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/media\/31033"}],"wp:attachment":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/media?parent=31030"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/categories?post=31030"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/tags?post=31030"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}