The lease vs. rent debate has been going on for a long time now and you should understand a few basics in this context.
There has been a long-running debate covering lease vs. rent and whether these two things are the same or not. Experts feel that rental agreements and lease agreements should be separately examined as concepts in order to get a clear idea of things.
Lease vs. Rent- Analyzing Agreements
Coming to lease agreements, they are accords where tenants get the right to stay in a particular unit for a pre-defined duration/period which is mostly 11-12 months. The entire period of the agreement may vary, depending upon the desires of the home-owner/landlord and the tenant. A lease, on the other hand, binds both the landlord and tenant for a longer time period.
So, in the lease vs. rent debate, you should know that leases will naturally bring the landlord and tenant to an arrangement mutually on the basis of specific aspects like the duration of the lease, rental amount, rules and regulations, conditions of termination and effective dates among others. This indicates that neither the landlord nor tenant can tamper with the clauses of the agreement without written consent of each other. Hence, a landlord will automatically benefit from the lease since tenants cannot stop rental payments or cannot renounce the unit during the period since it will violate the lease agreement. Additionally, landlords cannot force tenants to shift out in this period.
In the rental agreement format, this will be a mutual deal for a time period/duration which is more concise, i.e. with concurrence on a month-to-month basis. This permits both the owner and tenant to change agreement terms whenever they wish. As a result, the rent may be increased anytime as per the landlord’s wishes while tenants may also leave at any moment. These agreements can be renewed after every month, i.e. 30 days in case no proper notice has been given by either party. This offers privilege of leveraging a settlement for both parties on a month-by-month basis. Tenants have freedom to live somewhere for a few months and leave as per their convenience. Landlords have the freedom to rent out units for just a few months without any problems.
Key things worth keeping in mind
Remember that lease vs. rent debates will keep happening but terms and conditions of both types of agreements may vary. Regulations or laws governing the same may also differ from one city to another or even across States and municipalities. For example, some housing societies may have provisions for rent control while other societies may not have these measures in place. Secure and long lasting agreements entail a lease while shorter and more flexible arrangements entail rental agreements.
The landlord should also be revealing the following details to his/her tenant prior to the residential premises being occupied by the latter.
- Contact number, permanent address and name of landlord.
- Contact number and name of the person in charge of looking after the premises.
The tenant has to explicitly reveal his/her intentions with regard to the following:
- Paying multiple bills.
- Number of occupants to be accommodated on the premises.
Landlords will hold responsibility for making sure that the premises are vacated by earlier occupants within the date mentioned in the agreement and to provide a copy of the same to the tenant within a period of 21 days from moving into the rental unit. Security deposit means the provision of a comparatively higher sum of money with the rental unit’s landlord in case of the monthly rental system. For a lease, the deposit may be sought if you are subscribing to any service/maintenance.
This is done to ensure non-interrupted monthly rent payments in case tenants fail to pay the same in a timely manner. Security deposits also function in the same manner with regard to leases. Post expiry of the agreement, whatever remains of the deposit will be refunded to the tenant.