rent vs lease

Know the difference between rent and lease agreement in 2022

the difference between rent and lease agreement

Do you also think rental and lease agreements are the same? But it’s not. Though, people use these terms to define one thing, in reality, they are way too different from one another. Therefore, many of getting confuse between them. Let us know, the actual difference between the rent and lease agreement below.

LEASE AGREEMENT

A lease agreement is a legal contract between two parties(lessor & lessee) that allows the lessee to stay in a property for a certain amount of time. Let us know more about this agreement below:

  • A lease agreement is suitable for the long term.
  • Both the lessor and the lessee agree to specific terms and conditions throughout the lease agreement, such as the lease amount they have to pay, the lease duration, the identities of both the parties and so on.
  • In lease agreements without the other party’s approval, neither party can change the terms.
  • In this agreement, according to the lease amount the stamp duty gets calculated and paid. 
  • A party can also use a professional leasing business to negotiate the best terms for themselves based on their needs and specification.

Merits

  • Stability

A lease agreement gives security to the lessee as they can live for whatever period the agreement has signed off.

  • Security

A lease agreement provides stability which in turn guarantees security to the lessee. They can live stress-free for a fixed money and time period.

  • Long-term benefits

In a lease agreement, you can enjoy the long-term benefits of the property.

Demerits

  • Rigidity

After agreeing, the lessee can not negotiate the terms and conditions. It’s difficult to change the terms of the lease. So, changes are rarely.

  • Difficulty in Migrating

If the lessee has some circumstances where he/she needs to vacate the property. It becomes difficult for them to do so as they cannot leave the property before the lease period expires.

  • After consequences

There are consequences if the lessee breaks the lease such as a loss in deposit, legal issues, and many more penalties.

RENTAL AGREEMENT

A rental agreement is a legal document signed between two people (owner & tenant)  to rent a property from the owner to the tenant for a specific period of time. A rental agreement is an important document which benefits both the tenant and the landlord. Let us discuss the main points below:

  • The document contains terms & conditions and other information about both the parties (landlord and tenant).
  • Landlords prefer 11 months of rental agreement in India just to avoid the tiresome registration process.
  • In the rent agreement, the stamp duty gets calculated and paid as per the state government. The commonly used stamp paper amount is 100 rupee.
  • After the tenure period, both parties can renew the agreement while executing a new agreement.
  • An agreement of a rental house is usually month to month contract, with no long-term requirements.

Merits

  • Flexibility

 This agreement does give a sense of freedom to both the tenant and the owner.

  • Short-term

The rent agreement is short term contract. If after renting a property a tenant want to change for another property he can do so after the notice period.

  • Comfortability

The tenant can easily move from one property to another according to his/her comfort.

Demerits

  • Rent increases

The landlord has the right to hike the rent of the property as mentioned in the contract.

  • Less Stability

The tenant can not enjoy the advantage of long-term stability. For example, if a family lives in a rented house they don’t have the stability of living for a long period.

Difference Between Rent And Lease Agreement:

Let us know the basic difference between the rent and lease agreement:

Basis Of DifferenceRent AgreementLease Agreement
MeaningA rental agreement is a legal document signed between two people(owner & tenant)  to rent a property from one party to another for a specific period.A lease agreement is a legal contract between two parties(lessor & lessee)  that allows the lessee to stay in a property for a certain amount of time.
Stamp Duty
In the rent agreement, the stamp duty gets calculated and paid as per the state government. The commonly used stamp paper amount is 100 rupee.
according to the lease amount the stamp duty gets calculated and paid. 

Term

For 11 months approx.

A lease is suitable for the long term.
ModificationChanges can be made.
A lease agreement is of rigid nature, before the completion of the lease period no changes can be done to the document.
Maintenance 
The landlord has the responsibility of maintenance.
The responsibility lies on the shoulder of the lessee.
Payment 
Month-to-month payment is done by the tenant.
The lessee has to do a one-time payment.

CONCLUSION

Though signing a lease is a complicated process involving legal paperwork, renting a property is much simpler, You may say it is lease vs rent but both the services are beneficial in their ways, and what suits you best go for it! And if in any case,  you have already chosen a place for rent and want a rent agreement you can get it online and offline. The offline process of getting a rent agreement is time consuming so we suggest you to go Online it can save your money and time both. You can apply of online rent agreement by visiting edrafter online rental agreement.

To know more visit all about Rental agreement form.

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