GUWAHATI: It is important that you read the rental agreement carefully before you sign on the dotted line when taking a house on rent. Make sure to read the rental agreement carefully, as you have to make sure that vital clauses are included that will protect your rights as a tenant . Here are some of the clauses that should be covered in the rent agreement.
Refund of security deposit: The sum of the security deposit differs from city to city. In metros, the amount is more than in tier-II cities. Although refundable, often disputes occur on the payment of security deposit.
Also, a separate payment receipt of security deposit with details of cheque number, date and signature of the owner should be sought.
Penalty for delay in refund of security deposit: A refund of security deposit out of the landlord's pocket is any tenant's nightmare. In the rent agreement, it should be clearly mentioned that if the owner fails to refund the security deposit, then the tenant can retain the possession of the flat without paying any rent, says a real estate expert.
Timeline to pay rent: There should always be a mention in the rent agreement whether the rent will be paid in advance or after the month gets over. It is important to state in the agreement that rent will be paid on or before a certain date every month.
Flexible termination rights: Ideally, there should be no lock-in period in the rent agreement and the tenant should be able to vacate the premises after serving one-month notice. However, landlords typically impose a lock-in period during which licensee's or tenant's ability to terminate the agreement is restricted. In the event the tenant is desirous of occupying the premises for a longer period, he should demand a longer lock-in period.
Assertion of owner having the title of the property: The tenant should ensure that the landlord is the true owner of the property. The tenant should ensure that the ownership and possession of the premises is with the landlord. The rent agreement should also contain a representation from the landlord that he is the owner of the premises, and that the premises is free from encumbrances and litigation.
Maintenance and non-maintenance charges: Another bone of contention between the landlord and the tenant is the inclusion of maintenance and non-maintenance charges in the rent agreement. It should be settled between the two parties as who will bear the monthly maintenance but for non-maintenance charges, such as in the case of apartment associations who keep charging additional amounts for corpus fund, sinking fund, painting of apartment etc, these should be borne by the owner of property. Another line should also be included that the landlord is responsible for settling the utility bills, maintenance charges and any other dues incurred with respect to the property prior to the commencement of the tenancy.
Government taxes and other levies: Dispute often emerge between the landlord and tenant on payment of sundry government taxes. The rent agreement should provide that the property taxes and other such taxes, cesses, and amounts payable in respect of the premises should be the responsibility of the landlord, including property tax, municipality tax, sewer and drainage charges, water bills, among others.
List of fittings and fixtures; wear and tear of property: The rent agreement should have a clause inserted stating that fittings and fixtures provided by the owner should be in working condition. With ageing of property, natural wear and tear is obvious. Include a clause that the tenant is only liable to bear the cost for damages which are not part of natural, reasonable and normal wear and tear of the property.
Terms for renewal and brokerage: To avoid any dispute in future, there should be a clause in the rent agreement regarding renewal of agreement if both parties mutually agree. This clause should be about the percentage increase in rent, deposit among other things in the event the tenure is renewed. On the issue of brokerage, a tenant should insert a clause that the brokerage would be one-time.
Protection against sale of the property by the landlord: There have been cases where landlords sell off their properties while tenants are still occupying premises. This leads to undue hassle for a tenant. To safeguard his interest, the rent agreement should provide that the tenant's right to use the premises should not be affected by the landlord transferring the premises and that the new owner should be bound by the terms of the rent agreement, including refunding the security deposit, if any, to the tenant.
Indemnity clause: An indemnity provision should be in the rent agreement wherein the landlord indemnifies the tenant for any loss or damage caused or suffered to the tenant on account of misrepresentation or breach of contract by the landlord or on account of defect in the title of the landlord to the premises. At the same time, it is also pertinent to check if the landlord has obtained all requisite consents for leasing or licensing the premises such as the permission from the society / association of apartment owners in which the premises is located.
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