Tuesday, June 4, 2019

5 Main Key Differences between commercial and residential lease Agreement

Commercial Lease Agreement 

A commercial lease is signed between a business entity and the owner of the property which the entity is interested in for a lease. The terms and conditions are laid down in such a way where the owner agrees to let the entity occupy the property to carry out activities as per the business along with the permissible modification in the property.


 Residential Lease Agreement

The term “residential lease agreement” refers to the legally binding contract created between a landholder and his tenant and contains all the terms for dealings a house or flat as a residence. This document is additionally referred to as Associate in the Nursing flat rental agreement or a landlord-tenant lease. commonly it's signed at the beginning of a rental term and remains in impact till the tip date indicated within the agreement.

Now Let’s see the Main Difference between Commercial Lease Agreement Residential Lease Agreement. 

As the name suggests commercial lease is for business purpose and the residential lease is for living use

  1. A commercial lease is a contract between a business tenant and owner while the residential lease is between the individual(s) tenant and landlord.
  2. In a commercial lease, the property is used for business and profit-making purpose whereas the property is primarily used for residential purpose and no commercial activities are allowed in a residential lease.
  3. In a commercial lease, the rent consideration is typically based upon the amount of square foot/meter occupied by the tenant whereas in a residential lease the rent consideration is based upon a set amount per month varying from a month-to-month lease to a term of years.
  4. In a residential lease, tenants have a lot more protection than commercial lease tenant.
  5. In a residential lease, there are certain obligations that the landlord need to provide like water, electricity and certain maintenance whereas there are no such obligations for the commercial owners unless explicitly defined in the contract.

Though each state has its own rules and regulations on commercial and residential leases, all states make general distinctions between the two types of leases between landlord and tenant. 

As per the premise type, uses, and contracts one can choose an appropriate type
of Commercial and Residential Lease Agreement. If you need one Rentalagreement.in helps you to choose the right one, draft it and send it to your doorstep!



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