What is meant by Apartment leases? How do apartment leases work? What are its benefits? Are there any drawbacks?
In this article we are going to find out how apartment leases work, why lease an apartment, the pros and cons, as well as the conditions required for a renewal.
How Do Apartment Leases Work?
An apartment on Lease is the same as an apartment on rent. A lease is a legal contract between the lender i.e. the landlord and the borrower i.e. tenant.
It renders the points that are to be taken care of during the span when the apartment is on rent.
It covers up the responsibility of both the landlord and the tenant and the landlord that helps the apartment stay in a good, healthy and respectable condition. A lease is for a minimum time period of 12 months i.e. 1 year.
Why lease an apartment?
- Finance: Renting an apartment is far more beneficial than a mortgage or buying it when looking for savings. It has a monthly instalment that allows a person to save for other benefits of the person.
- Maintenance: Apart from the home bills the maintenance of the house is paid by the landlord. This means the tenant pays only for their living and things used by them in the apartment.
- Safety: Safety is another major concern for the person renting the apartment. An apartment has elevated safety over an independent house.
- Tax Benefit: Tax benefit is availed by both the tenant and landlord. A landlord can avail it on the basis of lending the property while the tenant can apply for MLP i.e. rental expense and avail the benefits.
Apart from other benefits, an apartment on lease carries benefits for both the tenant and the landlord.
Benefits of the lease for Tenants and Landlord
The rate of rent decreases when a person opts for a lease because a lease is often of a longer-term. The longer the rate, lesser will be the rent. After agreeing to a lease, the landlord cannot increase the rent of the property. The property rent is fixed and therefore is a plus point for the tenant.
The advantage to the landlord is that a lease cannot be legally broken even if the tenant has to leave the city due to job reasons or gets a better opportunity. The landlord has to receive the payment at a particular time of the month punctually. Failing to pay can lead to legal actions.
General rules while leasing an apartment
How do apartment leases work? Basic insight into leasing an apartment is to know its rules, regulations, terms, and conditions.
Every agreement starts with details of the amount to be paid, payment methods, payment date, flexibility and outcomes for late payment. This is usually introduced by the landlord by negotiating with the tenant. The views of the tenants are equally heard and taken into account.
Rushing and agreeing to a lease without reading it is not professional. Every professional landlord compromises on certain terms. Read the terms properly, give everything a good eye, understand, and then sign on the papers.
Leasing an apartment can involve including a roommate, pets, dividing of bills, etc. Adding them in the lease papers can help have a clear picture of it to which no one can deny.
Termination of Apartment Lease
Termination of a lease is not that easy. Some states do not allow termination of a lease. If a person has to opt for termination of an apartment lease, the landlord can make you pay for the lending months and then free you of the lease.
Some of the landlords tend to choose the buyout clause and freeing the tenant. They usually keep with themselves the security deposit paid during the agreement of the lease.
If any of the lease terms are violated, the tenant can be kicked out of the apartment with the termination of the lease.
If the tenants and the landlord have done nothing to violate the terms and conditions, the tenant can sublease the apartment making sure it does not go against their lease.
Renewal of Apartment lease
When a lease of a particular period expires and the tenant wishes to continue to live in an apartment, they can request the renewal of the lease. Renewal of a lease is a major subtopic when it comes to answering how do apartment leases work?
Renewal of a lease is re-establishment of the old norms or policies or the introduction of new terms. Renewal is more beneficial for the landlord as it helps them increase the amount received per month.
For both the landlord and the tenant, the new terms can be introduced or the old ones can be made null and void as per what they had experienced as a relation for the past lease terms.
On the contrary, if the tenant wishes to extend their stay period by a few months, the extension of a lease is the best fit. Extension of a lease is another important feature but has to be done before the expiry of the lease.
Even for extension consent from both ends is equally important. Changes in lease terms cannot be made until there is a mutual agreement between the tenant and the landlord.
Disadvantage of Lease
The tenant can only use the apartment. They have no right to make changes or to put in changes as per their own personal view.
There may be several restrictions on the working habits of the tenant. When a person leases the apartment, every little detail is monitored and governed by the landlord.
With no rights on the living space, the tenant has to pay monthly installments to the landlord to which they cannot deny. Failing to do so can lead to some serious actions including termination of the lease.
Leasing an apartment is a beneficial process. They are not only beneficial from a civil point but also from a legal point of view. A lease document should be properly read and studied before agreement or signing.
Any further changes or alterations to be done are by mutual consent by both the landlord and the tenant.