How to Make a Rent Agreement – People often migrate to big cities in search of higher education and job opportunities. On arriving in these big cities, people look out for affordable rental spaces. In today’s time, many tenants and homeowners are opting to legally register their rental agreements. However, if you are puzzled about what goes into the making of a rent agreement, Gupta Document Center has elaborated on How to make a Rent Agreement. With this blog, you will learn about the basics of drafting a rental agreement and what are the benefits of getting a rental agreement for a specific period.
Rental agreements are drafted as per the guidelines laid down by the government. It is important to know How to Make a Rent Agreement to be able to get it legally verified. Gupta Document Center has compiled the blog to help them easily navigate the journey of drafting a rental agreement in your jurisdiction.
Paying Stamp Duty for a Rent Agreement
Stamp duty is a specific amount of tax paid to the government. Stamp papers are pre-printed revenue and have a tax stamp on them. Using stamp paper in the rental agreement gives it legal verification and authenticity. Check out the payable stamp duty for a rent agreement for different lease duration.
| Rent agreements of less than one year | Rent agreements between one and five years | Rent agreements between eleven and twenty years | Rent agreements beyond twenty years |
| Tenants who have a rent agreement of less than 12 months have to pay a stamp duty equal to 2% of the annual rent. | payable stamp duty is 2% of three times the average annual rent. | Pay 2% of five times the average annual rent. | Pay 2% of six times the average annual rent. |
Procedure to Draft a Rental Agreement
The procedure for drafting a rental agreement is not complex. Hiring the right rental agreement lawyers can simplify the process and draft the rental agreement as per the clauses mutually agreed upon by both the tenant and the homeowner. The procedure to make a rent agreement is briefed below:
- Draft the rent agreements after including the clauses mutually decided by the landlord and the tenant.
- Get the document printed on a stamp paper of the recommended value after carefully reviewing it.
- The rental agreement shall be signed by the tenant, landlord, and two witnesses.
- The rent agreement with a validity of more than one year must be registered at a local sub-registrar office.
However, the procedure for creating a rent agreement may not be similar in all jurisdictions. You shall consult your rent agreement lawyer to get a better perspective on your area.
Step-by-Step Guide on How to Make a Rent Agreement
The process to register a rent agreement is elaborated in the step-by-step guide below. However, only the rent agreements of more than one year should be registered. The rent agreements that are for less than a year, notarizing them with a notary public and paying for the stamp duty is enough to gain legal credibility. Read the steps given below to learn how to make a rent agreement:
- Begin by outlining a rental agreement with clauses, mentioning the key points of security deposit, rent, and additional requirements.
- After the clauses are discussed, you are required to get the rental agreement printed on a stamp paper of a specific value.
- The signatures of the tenant and landlord are required at a designated place in the rent agreement.
- The signatures of two witnesses who are not related to the tenant and landlord in any way.
- The landlord and the tenant are required to be physically present at the sub-registrar office of their jurisdiction.
- Both, the tenant and landlord along with the two witnesses are required to submit their passport-size photographs and ID cards for validation.
- The registration of the rental agreement cannot be permitted by another person or an agent.
- Once you pay the stamp duty, the rent registration process is complete.
Format of Rent Agreement
The rent agreement should follow a basic format to become legally acceptable and verified. Go through the format given below to ensure your rent agreement format is correct and follows all the regulatory guidelines. You can also verify your rent agreement format with any rent agreement lawyer to ensure it is correctly drafted and is in alignment with the guidelines set by your jurisdiction. Check out the format given below to get a better idea.
Documents Required to Make a Rent Agreement
Without proper documents, it is impossible to draft a rent agreement. To ensure that you do not face any difficulty in submitting the proper documents, we have listed all the documents below required to make a rent agreement.
- Original copy of ownership proof or a copy of the title to the property.
- Property documents such as Index II or tax receipt of the property to be leased
- Two photographs of both the tenant and the landlord and one of each of the witnesses
- Copy of the address proof of both the parties and witnesses. Passport, Aadhaar Card, Ration Card, Bank Passbook, or Driving License; any of them can be submitted as the address proof
- Route map of the property leased out.
Important Things to Include in a Rent Agreement
A rent agreement shall include all the important points and clauses to make it authentic in the eyes of law and order. To help you draft your document properly we have listed down the important things to include in your rent agreement are mentioned below:
- All the details of both the parties involved.
- Right of the landlord to enter the property.
- Permission for pets.
- Details of monthly rent along with security charges and maintenance charges.
- Penalty if the rent gets delayed.
- Terms of tenancy.
- Evacuation of the tenant in case of any dispute or the violation of rental agreement.
Conclusion
Rent agreement has gained immense popularity, especially in the big cities. With this guide on how to make a rent agreement, you will face no difficulty in going through the whole process. This blog is extremely helpful for both the tenant and the landlord. Rent agreements are an excellent legal tool to avoid disputes or unfairness with any party. However, with this blog by the Gupta Document Center, you will get a clear idea of how to draft a legally verified and authentic rental agreement.