Types of Real estate Agreements You Should Know
Why are Real Estate Contracts Required?
- The Client
- Builder or the contractor
Drafting a real estate agreement:
That is why, any deal is a vessel for transferring the maximum liability onto another party, and a real estate contract is no different. If a contract isn’t appropriately drafted, the property developer could use the loopholes to cause significant loss to the client.
Details to include in the agreement:
- Names of the Parties: The legal names of both the landlord and the tenant.
- Description of the property: The property should be adequately described along with its street address of the leased property as well as the city and the county.
- Duration of the lease: The length of the term of the lease should be properly mentioned in the agreement (including the beginning and ending date). Though the term should be completed, Tennessee renter’s rights to break the lease also exist. This means that upon the payment of balance rent, the renters can pre-maturely break the lease.
- The amount of rent that will be paid over the life of the lease, the amount that will be paid each month, the date the rent is due, how rent may be paid, when rent is considered late, the amount of any late fee
Advantages of Resla estate agreements:
- Balanced cash outflow: The biggest advantage of leasing is that cash outflow or payments related to leasing are spread out over several years, hence saving the burden of one-time significant cash payment. This helps a business to maintain a steady cash-flow profile.
- Better planning: Lease expenses usually remain constant for over the asset’s life or lease tenor or grow in line with inflation. This helps in planning expenses or cash outflow when undertaking a budgeting exercise.
- Termination rights: At the end of the leasing period, the lessee holds the right to buy the property