As a property owner, you may feel exciting about the extra income your property earns for you. But at times it can be chaotic, stressful and pressurizing. To avoid such scenario, it is better to be pre-prepared with the pros and cons of renting out a property to make money out of it. Remember, the property you want to rent should be on papers and the rental agreement should be legal. This is not only safe for the tenant but for the property owner as well to be secured about the terms beforehand.
If you are a property owner/homeowner, then this blog would let you focus on key points before and after having a rental agreement and would help you avoid some basic mistakes that happen in a rental application. Below is the list of topics we cover for you-
Check on the Tenant’s Name
Mention the Terms for Evection
Mention the Notice Period to leave the property
Discuss about Lock in And Termination
Keep Payment Terms Specific
Be Clear About Repairs & Maintenance
Mentioning Subletting Terms
Take POA details
Add necessary miscellaneous clauses
Mention the Agreed Rent Amount
Take Tenant’s Permanent Address Details
- Check on the Tenant’s Name-
Always remember to cross-check the tenant’s name with their legal ID Cards like, PAN Card, Adhaar, Passport etc. Don’t be satisfied with only one ID proof and ask for atleast two different Id cards to verify. See that the same and exact name is written in the rental application so that there is no ground of fraud on this basis. - Mention the Terms for Eviction-
Eviction terms should be clear before signing of the rental application. Tenant should be made aware of the issues that will lead to eviction like- not complying with the rules of the building society, not paying rent for more than 2 months consecutively, conducting illegal activities in the apartment etc. - Mention the Notice Period to leave the property –
Never miss on the notice period and clearly mention that after ordering eviction by what time, the property should be completely vacated? - Discuss about Lock in And Termination-
It should be clarified that the tenant has to stay for a minimum time period say 1 to 6 months in the rented property and can’t evacuate before that. Also if after completing this lock in period, if the tenant wants to vacate the place there should be a sufficient notice period given to facilitate the owner to find out other tenants soon. - Keep Payment Terms Specific-
The agreed rent amount, the payment mode and the payment time should be predefined in the application. Also notify the penalty for delayed payments. - Be Clear About Repairs & Maintenance-
A clear bifurcation of minor and major repairs and who will pay what, should be pre-decided in the rental application. Who will be paying maintenance is also a point of concern. - Mentioning Subletting Terms-
Clearly notify that you allow subletting or not. So that the tenant doesn’t get the right to reuse your property by lending it to someone and any kind of damage does not occur to your property. - Take POA details-
The rental agreement should consist of the details of owner and of the one who is given the Power of Attorney in absence of the owner. This common mistake could become very big when your agreement will be considered invalid and redoing it would cost you heavy. - Add necessary miscellaneous clauses-
As per the aforesaid points to remember, if there is anything that you particularly want to clarify or mention regarding the rental agreement or want to put in some terms and conditions, you can mention it in this clause. - Mention the Agreed Rent Amount-
The agreed rent amount should be clearly mentioned in the agreement. Also the percentage or amount of increment should be pre-decided and kept transparent alongwith valid reasons mentioned. - Take Tenant’s Permanent Address Details-
Tenant’s permanent residential details should be taken and verified before letting them in an agreement with you. This is helpful in case of emergencies and also for authenticity.
Just remember these points and start earning from your property. It is to be hence noted that mistakes are to be avoided for a smooth earning from your home. You can also make the procedure simple with the professional assistance of Sunil Agrawal & Associates and get verified tenants to ease out the process.
