Rent agreement basics: what to read before you sign

The night before the keys

Finding a flat to rent can take weeks. When you finally find one, the agreement often arrives late: a file from the landlord or a broker the evening before you are due to collect the keys, with a note that it is the standard format. The deposit has been agreed, the move is booked, and nobody wants to reopen anything.

That is exactly when a rent agreement deserves a careful read. Most of what matters in a tenancy is not the first day but the months that follow and, above all, the day it ends: how you leave, how much notice you give, and how much of the deposit comes back.

This is a general guide to reading a residential rent agreement in India. It is not advice on any agreement, and the rules differ from state to state.

Start with the ending

A useful habit is to read the agreement from the end of the tenancy backwards. Questions about notice, deductions and the condition of the flat come up when a tenancy ends, so begin there. Look for:

• The term, and what happens when it runs out: does the agreement end, renew automatically, or need a fresh agreement?
• The notice period each side must give to end it early, and how notice must be given.
• A lock-in period, during which one or both sides cannot end the agreement, or must pay if they do.
• The deposit: how much, when it will be returned, and what may be deducted. Vague words such as "deductions for damages" are worth pinning down. Damage beyond normal wear and tear? Assessed how, and with what evidence?

If the agreement is silent or one-sided on these points, the time to ask for a change is before you sign.

Then the money

Note every amount and every date: the monthly rent and when it is due, how it is paid, whether it rises on renewal and by how much, and who pays maintenance and society charges, electricity, water and property tax. If there is a charge for late payment, note it.

Anything agreed in conversation, such as "the flat will be repainted before you move in", belongs in the agreement. A promise that is not written down is hard to rely on later.

Repairs, use and the inventory

Check who is responsible for minor day-to-day repairs and who for major or structural ones, and who pays for each. If the agreement does not say, ask before you sign.

Check what the premises may be used for, whether sub-letting is allowed, and any rules on alterations or pets.

Finally, ask for an inventory: a list of the fittings and furniture in the flat and their condition, signed by both sides and attached to the agreement. Dated photographs taken on the day you move in support it. When the tenancy ends, the inventory and the photographs are what the deposit discussion will turn on.

Stamping and registration

In India, stamp duty is generally payable on a rent agreement, at rates set by each state, and many states allow the duty to be paid electronically through e-stamping. An agreement that is not properly stamped can run into difficulty if it is ever needed as evidence.

Registration is a separate question. Under section 17 of the Registration Act, 1908, a lease of immovable property from year to year, for any term of more than one year, or reserving a yearly rent must be registered. That rule is often given as the reason so many residential agreements are written for eleven months.

Some states go further. In Maharashtra, for example, section 55 of the Maharashtra Rent Control Act, 1999 requires leave and licence agreements and tenancy agreements made after the Act came into force to be in writing and registered, whatever their length, and puts the responsibility for registering them on the landlord.

Because the rules depend on the state and the type of agreement, check what applies before you sign. The Acts are published on India Code.

The Model Tenancy Act

In June 2021 the Union Cabinet approved a Model Tenancy Act and circulated it to the states and union territories to adopt for future tenancies, either through a new law or by amending their existing rent laws. Among other things, the model limits the security deposit for residential premises to two months' rent.

It is a model. It changes the law in a state only when that state adopts it, so check your own state's law before relying on any of its provisions.

Signing with your eyes open

None of this needs a confrontation. A short list of changes sent before signing, such as the deductions defined, the notice period made the same for both sides, and the inventory attached, is an ordinary part of agreeing any contract.

What you get from that half hour of reading is simple: you know what you have agreed to. When the tenancy ends, the questions that usually cause trouble, such as notice, deductions and the condition of the flat, already have written answers signed by both sides.

If the agreement is unusual, the amounts are large, it is a lease of commercial premises, or you are asked to give up rights, speak to a qualified advocate before you sign. Whether a particular clause is fair or enforceable in your situation is a question for legal advice. If you use an AI tool to help you read an agreement, the guide to what AI can and cannot do with legal questions explains where it helps and where it goes wrong.

Where AI Lawyer fits

Help with drafting and reviewing routine documents is one of AI Lawyer's planned features, alongside step-by-step guidance and case organisation, which keeps the documents and notes for a matter in one place. AI Lawyer is planned, with no code yet, and it does not give legal advice: whether you should sign an agreement is a question for an advocate. For the checks that apply to any agreement, read what to check before you sign a routine document, and for the product itself, what AI Lawyer plans to do.