Whenever you go to rent a house, the landlord definitely asks you to get a rent agreement made. In this, the name and address of the tenant and the landlord, amount of rent, tenure of rent and many other things are written. This is a kind of lease agreement, which is made only with the consent of the tenant and the landlord. Most rent agreements are made for 11 months. You too must have made an agreement for 11 months to live on rent, but have you ever wondered why the agreement is made only for 11 months? Let us explain why such a rule has been made.
Why was the rule made?
Actually, one of the reasons behind making a rent agreement for 11 months is the Registration Act, 1908. According to the terms of Section 17 of the Registration Act, 1908, it is not necessary to register the lease agreement if the period is less than one year. This means that rent agreements for less than 12 months can be made without registration. This option saves landlords and tenants from the process of visiting the sub-registrar office to register documents and paying registration charges.
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Reason for 11 month agreement
Not registering if the tenancy period is less than one year also saves stamp duty, which has to be paid on registering the rent agreement. To avoid such charges, landlords and tenants generally decide not to register the lease by mutual consent. This means that apart from rent, to avoid expenses and hassles related to other legal processes like registration, the trend of making a rent agreement for 11 months is popular.
This way you can make an agreement for more than 11 months
However, you can make an agreement for more or less than 11 months. Whenever a person registers a rent agreement, the stamp duty is decided on the basis of the rent amount and the period of rent. The longer the tenancy, the higher the stamp duty. That means, the longer the duration of the agreement, the more money you will have to pay. There is no additional charge for making an agreement for less than 11 months.