Rent agreement is the only document that binds the tenant and landlord in a legal agreement during tenancy. Usually, there is a standard format of the agreement which brokers use as a template and change the details of the parties and the terms of the agreement. While acknowledging that brokers are experts in preparing rent agreements, it’s important for tenants to have a thorough review of the terms and conditions mentioned in the agreement. I have tried to list down all the important points to be carefully read and understood before entering signing the agreement.
Rent Amount & Payment Date
This one seems quite obvious as all of us check the rent amount mentioned in the agreement. However, tenants should also check the monthly rent payment date. Though the landlord would want the rent paid in advance possibly even before the last day of the previous month. But tenants should choose the date as per their convenience. For e.g. if your salary is credited on the last day of the month then you should take a couple of days buffer and agree on the rent payment date accordingly.
Security Deposit
Again something which people usually review before signing the agreement, just need to make sure the mode of payment and other details are mentioned in case of non-cash payment. For e.g. Cheque Number, Transaction ID, etc.
Agreement Period, Start and End Date
Tenants should double-check all these three dates carefully. For example, some brokers intentionally make 11 months agreement instead of a complete one year agreement. Also, there are many instances when the time the start date is much before the actual possession date. Agreement start date should be the date on which you get the possession of the house.
Lock-in Period
It’s something that can be negotiated beforehand in case either party expects the possibility of termination before the schedule agreement period. One thing should be clarified whether the lock-in period included the notice period or excludes it. I.e. if the lock-in period is six months and a notice period of one month, can either party give notice to the other party after five months and ask to leave after six months. There are few instances where there is no clarity whether tenants can get out of the agreement just after the lock-in period or can notify the landlord and serve notice period after the locking period.
Notice Period
It’s the minimum duration which either party has to give intimation in advance to the other party to end the agreement.
Maintenance & Other Bills
The agreement should clearly mention who will pay the society maintenance charges(if any) and the other utility bills. Usually, society maintenance bill is included in rent and utility bills like water, electricity and cooking gas bills are to be paid by the tenant.
Privacy
It’s a clause that sometime becomes a point of contention later. Can the landlord or his representative enter the rented premise without notice to the tenant and in the tenant’s absence? Though the landlord holds the right for timely inspection of his property, tenants also have the right to privacy and no landlord can enter without prior notice or in the absence of tenant.
Termination
The clauses for agreement termination should be clearly mentioned and agreed upon.
List of Furniture, Fixtures, and Fittings
Usually this list comes as an annexure but is the most important of all the points mentioned above. Tenants should inspect each item carefully and report any issue with their condition. Any damaged items should be mentioned accordingly to prevent any harassment at the time of leaving.