Difference Between Lease And A Rent Agreement ?

Rental agreements and lease agreements are both legally binding and in most cases could be used for the same thing, however they have different meanings. Though the agreements are similar in nature but they are different in application, thereby making it  important to understand the difference between these two agreements. Following article discusses the difference between the Rent and Lease Agreements.

Before you settle in any new property, whether it is rental or you have bought it, the current owner of the property would always make you sign a legal document. A legal agreement must be signed before shifting into any new property so as to avoid any future mishap. There are, however two types of agreements, i.e., Rent Agreement and Lease Agreement. 

Lease Agreement

Before you shift into a rental property, the owner of such property would ask you to sign a legal document referred to as a lease agreement. It shall provide the tenant a legal right to live in such property for a specific period of time. A lease agreement would help ensure the tenant that the owner of the property could not raise the rent of the property  any month without the consent of the tenants. Also, it shall also include that the tenants could not quit the property whenever they wish. 

A lease agreement would provide for the length of stay as well as monthly rent to be paid  for the tenants. In case the tenant wishes to continue his stay in the property even after the expiry of the agreement period, he will have to sign a new lease agreement.

In case you are facing any legal problem for matters related to lease or your tenancy agreement, and wish to seek legal counsel from a team of experienced advocates, you may contact us at Sharks of Law.

What Is A Rental Agreement?

A Rental agreement is legally binding between the owner of the property and the tenant who wishes to live on such property. However, a Rental agreement is different from a Lease Agreement.

A rental agreement is not a long-term contract. It shall be revised and renewed each month. Also, only a tenant or the owner of the property will have the right to revise or alter the terms and conditions at the end of each month.

For further information on the contents of a rental agreement and its profits, it is advised that you contact us at Sharks of Law.

Some of the Major Differences Between a Rent And Lease Agreement:

A Rental and lease agreement has a few differences, some of which have been mentioned hereunder- 

• Tenure: A lease agreement shall be signed by the lessee (tenant) for acquiring the property for a long period of time, while a rental agreement shall be signed by the  tenants allowing them to use the property for a shorter period of time.
• Parties: The parties which are involved in a Lease agreement shall be referred to as  lessor and lessee. The parties signing a rental agreement, on the other hand  will be referred to as landlords and tenants
• Change in the agreements: After a lease agreement is signed, neither the lessee nor the lessor will have the right to change the terms and conditions for a specific period. However, in the case of a rental agreement, the landlord could change the rent, terms and conditions of the agreement anytime they choose
• Consideration: In case of a lease agreement, monthly installments will be paid, but in case of  a rental agreement, the rent shall be paid in monthly or quarterly terms
• Offer at expiry: After the deadline of the agreement is over, the lessee will be offered to to buy the property or resource, whereas there is no such offer given to the tenant by the landlords.

What Shall be Included In The Rent And Lease Agreement?

• Names of-  

1. tenant who shall occupy the property 
2. owner of the property.

• Contact information of the landlord.
• Length as well as the type of tenancy in order to determine if the agreement will be a lease or rental.
• Amount of the rent to be paid, terms and conditions of the agreement, money transfer methods, as well as the security deposit.
• Specifics about the person who shall be responsible for utility charges.
• Any other additional charges for pet, parking, or other accommodations if any. 
• Damages or any Alteration caused to the premises.

Conclusion:

As could be deduced from the above explanation, both the agreements have different meanings, however to a layman, they may sound similar. Therefore, it is important to understand the concept of both agreements. A rental contract could act as a viable option for such landlords who often have tenants for a smaller period of time, especially in such areas witnessing a quick tenant turnover, such as college towns.

A lease could be a great option for such landlords who are vying to earn a stable income. In order to understand as to what shall be best for you, you may avail our consultancy anytime you wish at the Sharks of Law. Our team of best lawyers is experienced with matters related to real estate and other related issues such as RERA matters, lease agreement, tenancy agreement, or even for matters of arbitration, we could offer you necessary assistance por guidance as required. 

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