The Ultimate Guide on Factors to Be Verified Before Signing Rent Agreement

by Rituja S. Marketing Head

Tejas who had come to Pune from the small town of Punjab opted for rent accommodation near his office; the house was good and comfortable for traveling so he immediately signed a Rent Agreement. After 6 months his owner increased his rent by 10 %. It became expensive for him to pay an increased amount every month since nothing was mentioned in the Rent Agreement; Tejas had only 2 options, to pay the additional rent charges or to find another low-cost accommodation.

He could have avoided this situation by consulting Professional Rent Agreement Provider in Pune and carefully reading the agreement and making the right changes before signing the Rent Agreement that could have served his securities better.

There is a huge demand for homes in cities like Mumbai, Pune, and Bengaluru where people come from different parts of the country for a job, here are some few important things that renters should be aware of before signing the Rent Agreement.

What is Rent Agreement?

A Rent Agreement is a legal contract signed by the owner of the house and tenant or renter who is a desire to have possession of the property for a specific time period. The Contract states that the owner and the renter agree to follow the rental rules and regulations specified in the agreement. To authenticate the Rent Agreement, both the owner and the renter have to sign the agreement in the presence of two people who are non-beneficiaries of the property and they also need to sign on the agreement as witnesses.

What factors does the Rent Agreement include?

1. The name and address of both owner and renter as specified in their id proofs,

2. Address of the accommodation given on the rent.

3. Rules and regulations under which the accommodation is given on rent

4. Rent amount, deposit amount and accommodation tenure.

Here are the important factors you need to verify before signing the Rent Agreement

1. Check if the owner of the house is an actual landlord

Verify that the person you are dealing with is the real owner of the house and not a fraud person, many times the NRIs and investors employ the third party as caretaker, who rent it without any permission or knowledge of the owner. This is illegal and you may get troubled by fraud person.

2. Visit the location and check the home condition

Before you decide to stay on rent, you must visit the location, whether it is comfortable to travel, public transport facilities in the area, locality and society atmosphere.

Visit home and check if all necessary appliances and connections are working properly, check if any maintenance work or repairs have to be done or any property damage is there, inform all this to your owner before you shift.

Check water connection and timings, electricity connection, cleaning scenario, mobile and Wi-Fi range. Ask for the documents that prove all previous power, water and gas bills have been cleared and not pending.

After all, this when you are sure about the apartment and owner you can go for Rent Agreement, A general mistake we usually make is we do not read the entire Rent Agreement contract carefully before signing it. Ask for a copy of the Rent Agreement and make sure you go through everything before you sign it.

3. Check and verify the Rent amount and Deposited amount

Rent Agreement includes the amount of Rent fixed per month and the security amount or deposited amount. Owner may also add some more details like the day by which the rent is expected to be paid and if the renter fails to pay the rent by an expected period of the month then what will be fine.

4. Additional monthly charges

Rent Agreement should clearly mention that who will bear the additional monthly charges like electricity bill, society charges, cleaning charges, it may be included in rent in some cases, or it may be paid by renter additionally. Whatever the case, it must be clearly stated in the agreement to avoid further disputes.

5. Maintenance charges

Generally, the big maintenances are bear by the owner of the house and small maintenance issues are bear by the renter, but to avoid confusion you can also add this to Rent Agreement.

6. Rent escalation clause

Rent escalation is a legal provision in which the owner asks the renter to pay a higher aggregate rent per month by increasing the annual base rent by an agreed method during the term of the Rent Agreement. There are two reasons for this.

a. Increase in the apartment revenue

b. Increase in the overall rent price in the locality because of inflation

The owner can add this clause in the Rent Agreement; see if it is acceptable to you to pay increased rent within your accommodation tenure.

7. Rent Agreement Term

Generally, the period of Rent Agreement is 11 month, According to the Registration Act,1908, Rent and lease agreement registration is mandatory if the leasing period is 12 months or more than that. If a Rent Agreement is registered then it is also mandatory to pay the registration fee and stamp duty.

Most of the Rent Agreements are signed for 11 months so that the stamp duty and other charges can be avoided. If you want to make an agreement for a longer period then do not forget or avoid registration of the Rent Agreement.

8. Sale of the house clause

Check if the owner has added a “clause on the sale of the house”. If the owner chooses to sell the house during the tenure of the Rent Agreement, you need to know how many months you will get as a notice term to find new accommodation.

9. Penalty and notice period if agreements get violated

If one or the other party fails to complete the terms and conditions of the agreement, it will become unacceptable and the aggrieved party could claim penalty charges. Therefore the agreement should also include notice period and the penalty for violating the agreement without completing the mentioned period. Normally a one-month notice period is obliged as the notice period.

Contact Details:

Sonai Building, Office No. 2,

Opp- Shell Petrol Pump,

Wakad Road, Hinjawadi,

Pune 411057.

Mobile No: +91 8999284747

Email Id: eramailid@gmail.com

WebSite: http://www.easyrentagreement.com/