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Be careful when signing a lease agreement

Sunday, January 21, 2007

A few days ago a friend of mine emailed me telling that he was in some kind of trouble after signing a lease agreement. He had paid a very large amount of money to someone for the purpose of renting a house to be turned into his office. Later it turned out that the person is not the real owner of the house. Voila!

So, here's a few simple tips when you want to rent a house:
  1. Make sure you are dealing with the lawful owner of the house/land, or a person accorded with a sufficient proxy to lease the house/land
  2. Check with the true copy of the certificate (better with the original) and make sure that they are the owners. If the land/house is an inheritance and it has not been splitted, make sure every heir/successor who receives the inheritance approves the lease. Better way: make them all sign the agreement
  3. Check with the land register if the land is subjected to mortgage
  4. Is modification/renovation allowed? At who's expense?
  5. What happen if there is damages? Who covers the insurance?
  6. Who pays the tax and bills?
  7. Rest are the standard positive/negative covenants and warranties/indemnities by both parties