A Simple Guide To Lease Agreements

A Simple Guide To Lease Agreements

Anyone who has ever rented or given a place for rent knows that a lease agreement is one of the most important documents of a transaction between a tenant and a landlord. It contains the terms and conditions the tenant and landlord have agreed to in writing. 

Most importantly, a lease agreement allows the tenant to live in a rental property for a predetermined amount of time. Quite often, the lease is for six to twelve months until it is renewed at the landlord’s discretion.

Make sure to sign a lease agreement if you are interested in renting out a flat, house, or commercial place because it will protect your rights as a tenant. The same applies to the landlord.

In comparison, leasing a commercial property is a lot different than a residential one. For instance, the rent of commercial premises is higher, and the tenure could exceed for as long as five years. The terms and conditions of a lease agreement for a commercial property vary significantly. Moreover, tenants of commercial premises must verify several things before finalising any agreement to avoid unpleasant consequences in the future. 

If you want to know more about commercial lease agreements, keep following us, as we will soon be coming out with an informative and detailed blog to solve all your queries and help you learn.  

Did you know that in most cases, the validity of the lease agreement is for 11 months? You would be right to think that there must be a reason behind this because there is a very good one to note here.

A) The provisions of section 17 of the Registration Act of 1908 imply that a landlord and tenant can sign a lease of less than a year without registering.

B) In order to register a lease agreement, stamp duty is paid. Therefore, not registering the agreement by keeping its length limited to less than a year exempts the landlord and tenant from paying the fees. 


In case you are wondering, the stamp duty is determined by the length of the lease agreement and the rent. Registration fees increase if a property is rented for a long time. All parties involved in the transaction of rental property do what’s mutually beneficial. 

What Is Included In A Lease Agreement?

In case you are about to become a tenant, or you are a landlord giving your place for rent to someone, don’t forget to ensure the lease agreement contains the following information: 

  • For starters, monthly rent and its due date must be mentioned in the lease agreement.
  • The amount of the security deposit, which is usually equal to the rent of one or two months must be stated. Plus, the agreement should also have the date for the deposit’s refund.
  • Next, the agreement should clearly mention all the expenses that the tenant will be bearing, such as maintenance, water, electricity, gas, etc. The contract should also inform readers if the tenant is allowed a separate metre for utility connections.
  • The lease agreement must have information about the entire area rented by the tenant, including the number of bedrooms, bathrooms, kitchens, gardens, etc.
  • Tenure agreed between the tenant and landlord must also be included in the agreement. Moreover, the lock-in period, i.e., the time in which no party is permitted to cancel the lease, should also be mentioned.


    If the tenant leaves during the lock-in period, the landlord gets to retain the security deposit.

    If the landlord asks the tenant to leave before the lock-in period, the former must compensate the latter for an early notice to vacate the area.
  • If there are any restrictions that the landlord wishes to impose on the tenant, include them in the lease agreement. Being upfront saves everyone from the trouble of having to take legal action against one another in the future. It keeps all parties involved in a lease agreement satisfied. 

Do not leave out even a minor detail about the agreed terms and conditions between a tenant and a landlord. 


Should You Register A Lease Agreement?

By now, you must have realised why people do not prefer registering the lease agreement before signing it. It helps in saving a great deal of money for everyone. However, there’s a drawback to this cost-saving technique commonly used by a lot of tenants and landlords.

The court may not consider an unregistered agreement as evidence in a dispute. This ultimately beats the whole purpose of having a rental agreement, i.e., to protect the rights of the tenant and landlord. The court is going to ask you to submit other documents for proof of your claims, leaving you helpless since a lease agreement is often the only binding contract between a tenant and landlord. 

So, what do you think is better? To pay the stamp duty or to avoid it at the expense of losing a future dispute with your tenant or landlord?

Suppose you decide to take the high road and pay the stamp duty compulsory for registering a lease agreement. In that case, the tenant and landlord can equally split the costs or agree to whatever’s best for both parties. Regardless, make sure to include the information regarding the payment of stamp duty in the lease agreement. 

Who Benefits More From An 11-Month Lease Agreement?

While an 11-month agreement is beneficial for all parties to different extents, it is more favourable for the landlord. Think about it; the contract allows the landlord to increase the rent after eleven months instead of waiting for a year or more. 

Furthermore, landlords opt for an 11-month lease contract to avoid any inconveniences and disagreements with the tenants, especially if the former finds the latter unsuitable for extending the agreement. 

What’s important to note here is that it is easier to revoke an unregistered lease agreement by giving a one-month notice period to the tenant for vacating the place. 


Don’t worry, we won’t conclude this blog before answering one of the most commonly asked questions by tenants. 

Is it possible to vacate a place without completing the tenure mentioned in the lease agreement? 

The short answer is yes, you can leave at your landlord’s discretion or if the agreement allows you to do so. 

There’s often a ‘break clause’ in the lease agreement that allows both parties to end the tenancy period before completion. If you have good convincing skills, talk to your landlord, give them a good enough reason, and leave. 

A registered and notarized lease agreement with transparent terms and conditions is advantageous for both the tenant and the landlord. So, don’t avoid registering it with the appropriate authorities only to save a few bucks. Secondly, don’t try outsmarting the other person by deceiving them at the time of finalising the lease agreement.

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