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Q.

Who should Prepare Rental Agreement?

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Summary
Typically, the landlord arranges for the rental agreement, often engaging a lawyer or using an online legal service to draft it after negotiating terms with the tenant. While not legally mandatory to hire a lawyer, doing so ensures the document is compliant with the Indian Contract Act, Transfer of Property Act, and state-specific rules. Either party can also use standard templates, then customise clauses mutually.

Generally, it's the landlord who arranges the rental agreement. Usually, they hire a lawyer or an online legal service to prepare it once terms are settled with the tenant. Although legal counsel isn't compulsory. But if you involve one, they help to ensure the document follows the Indian Contract Act, Transfer of Property Act, and relevant state regulations. Alternatively, either party can start from standard templates and adjust the clauses by mutual consent.

What is the Process to Draft a Rental Agreement?

  1. Agree on rent amount, payment frequency, security deposit, and lease duration first.

  2. Decide who will write the initial draft: the landlord, tenant, agent, or a lawyer.

  3. Include both parties' full names, property address, and identity details.

  4. Add clauses covering the notice period, maintenance responsibilities, and house rules.

  5. Share the draft with the other party for review and requested changes.

  6. Finalize the agreed terms and incorporate any negotiated edits.

  7. Print the agreement on appropriate stamp paper as per state rules.

  8. Register the agreement with the sub-registrar if the tenancy exceeds 11 months.

  9. Sign the document with witnesses present for legal validity.

Who Pays for Preparing the Rental Agreement?

Preparing the draft and paying its costs aren't always the same responsibility. Typically, the tenant covers stamp duty and registration fees, while the landlord may bear drafting costs if a lawyer is hired, though this varies by mutual agreement. 

It is best for both parties to discuss and settle who pays for what before finalizing the agreement, to avoid confusion later. I hope you understood who should prepare rental agreement.

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