Understand your lease deed better!
A lease deed is a legally binding agreement that outlines the terms and conditions under which a property is leased. It is important for any tenant (lessee) to review the document carefully to avoid potential legal and financial risks.
Key Elements of a Lease Deed:
- Parties & Property Details: Names and addresses of both parties and an accurate description of the leased premises.
- Rent-free period: A timeline wherein the lessee is allowed to furnish the leased property during which no rent is applicable
- Financial Obligations:Agreed rent amount, due date, frequency of payment, and periodic escalations.
- Security Deposit: The amount held by the landlord, refund conditions, and permissible deductions.
- Responsibilities: Who handles repairs, maintenance, and utility payments.
- Permitted Use:Specifies what the space can legally be used for—such as office, retail, or storage.
- Termination Clause: Notice period, lock-in duration, and conditions under which either party may exit the agreement.
- Dispute Handling: The agreed process for resolving disagreements, often through arbitration or a specific court jurisdiction.
Lessee should watch out for fairness in the exit clause, annual rent escalation terms, and maintenance obligations. It is crucial to ensure all verbal promises are included in writing. Most importantly, have the deed reviewed by a legal expert before signing, and get it registered for full legal validity.
