Understanding Leases and How They Differ from Normal Rent

What is a Lease?

A lease is a legally binding contract between a landlord and a tenant that outlines the terms and conditions under which the tenant agrees to rent a property for a specific period. This agreement provides both parties with a clear understanding of their rights and responsibilities.

Key Features of a Lease:

• Fixed-Term: Leases typically have a fixed duration, such as six months, one year, or more. During this period, the terms cannot be changed unless both parties agree.
• Legal Protection: A lease provides legal protection for both the landlord and tenant. It specifies the rent amount, payment schedule, security deposit, maintenance responsibilities, and other crucial details.
• Stability: Leases offer stability to tenants, ensuring they can occupy the property for the agreed-upon period without unexpected rent increases or eviction without cause.

How Leases Differ from Normal Rent Agreements

Leases:

• Fixed Duration: Leases are usually for a longer, fixed period.
• Terms Cannot Change: Terms are set for the duration and can only be changed if both parties agree.
• Legal Commitment: Breaking a lease can have legal consequences for both parties.

Normal Rent Agreements (Month-to-Month Rentals):

• Flexible Duration: These are often month-to-month and can be terminated by either party with proper notice (usually 30 days).
• Variable Terms: Terms can be changed with proper notice, making it easier to adjust rent or other conditions.
• Less Commitment: Provides flexibility for both landlord and tenant but less stability.

Documents Needed by Landlords

To ensure a smooth leasing process, landlords typically require several documents from potential tenants. Some of them are as under:

• Rental Application: This form collects basic information about the tenant, such as name, contact details, employment history, and references.
• Credit Report: Helps assess the tenant’s financial responsibility and ability to pay rent.
• Background Check: Ensures there are no criminal records or past evictions.
• Proof of Income: Pay stubs, tax returns, or bank statements to verify the tenant’s ability to afford the rent.
• Identification: A government-issued ID (e.g., driver’s license, passport) to verify the tenant’s identity.
• Reference Letters: From previous landlords or employers to vouch for the tenant’s reliability and character.
• Security Deposit: Usually equivalent to one month’s rent, held as security against potential damages or unpaid rent.

Always hire a Realtor to assist or you can talk to a lawyer who specialises Real Estate for any further guidance.