In order for renters and homeowners to live together in harmony, a rental agreement or lease contract is a requirement. Such a contract stipulates all the terms and conditions involved in the renting procedure. Landlords who lease their homes to tenants must adhere to the conditions provided in the rental agreement while residing tenants should also. This article includes a rental agreement format, various types of rental agreements, the procedure for executing the rent agreement, and other relevant information.
Types of Rental Agreements Commonly Used
There are 3 types of rental agreements in India:
1. Rent Agreement: A rent agreement is a fundamental contract between a landlord and tenant, granting temporary possession of a property.
– Duration: Typically 11 months, with the option for renewal. Registration is mandatory if the agreement exceeds 11 months.
– Key Points: Includes essential details such as names, property description, rent amount, late fees, grace period, security deposit, facilities, parking, repairs, insurance, and more. Designed to be straightforward and hassle-free.
– Registration: Optional for agreements under 11 months.
2. Lease Agreement: A lease agreement is a more formal contract for extended occupancy, generally exceeding 12 months, and is governed by the State’s Rent Control Laws.
– Duration: Typically over 12 months.
– Key Points: Creates an interest in the property, granting the tenant certain rights to use it for the agreed period, even if the property is sold. Can be for long-term periods and binds both parties for the entire term.
– Mandatory Registration: Required for legal enforceability.
3. Leave and License Agreement: This agreement grants permission to occupy a property, distinct from a tenancy agreement.
– Duration: Flexible.
– Key Points: Unlike a lease, it doesn’t create an interest in the property and can be revoked by the owner at any time. It grants permission to occupy without establishing a landlord-tenant relationship, making evictions easier.
Rent Agreement Format
Contents of a Rental Agreement
While the specifics of a rental agreement may vary, the following are typical inclusions:
- Parties Involved: Names of the landlord, tenant, and/or their agents.
- Property Description: Address and details of the rented property.
- Rent Details: Rent amount, payment due dates, grace period, and late charges.
- Payment Responsibilities: Who is responsible for additional payments such as property tax, TDS, maintenance charges, and utility bills.
- Mode of Payment: How rent and other charges will be paid.
- Termination Conditions: Methods to terminate the agreement before the expiration date, along with any applicable charges.
- Security Deposit: Amount, purpose, and conditions for return or adjustment at the end of the rental period.
- Facilities and Utilities: Which utilities are included in the rent and which are the tenant’s responsibility, as well as facilities like parking and use of common areas.
- Maintenance and Repairs: Responsibilities of the landlord and tenant for property upkeep.
- Regulations: Rules such as pet policies, noise regulations, and penalties for violations.
Key Terms in a Rental Agreement
- Duration: The length of time the rental agreement is in effect.
- Rent: The payment made by the tenant to the landlord for the property.
- Deposits: Details about any security deposits required and their conditions for return.
- Terms of Use: The purpose for which the property can be used and related conditions.
- Utilities: Responsibility for utility payments.
- Insurance: Whether the tenant is required to insure the property.
- Repairs and Maintenance: Division of responsibility for repairs.
- Termination: The conditions under which the agreement ends and the settlement of dues.
Documents Required for Registration of Rental Agreement
When registering a rental agreement, certain documents must be submitted by the landlord, tenant, and witnesses to ensure the legality and authenticity of the contract. The following is a list of commonly required documents:
Proof of Ownership:
- Title deeds of the property, indicating the landlord’s ownership.
Property Documents:
- Property tax receipt for the rented property.
Photographs:
- Passport-sized photographs of the landlord, tenant, and witnesses.
Address Proof:
- Valid address proof for both the landlord and tenant, as well as the witnesses. Acceptable documents include:
- Passport
- Aadhaar card
- Ration card
- Bank passbook
- Driving license
- Valid address proof for both the landlord and tenant, as well as the witnesses. Acceptable documents include:
Route Map (if required):
- A route map of the property being rented out.
Additional Documents:
- Any other documents specified by the Sub-Registrar’s office during the registration process.
Having these documents ready will facilitate a smooth and hassle-free registration of the rental agreement.
