# URGENT Lease question, all input appreciated



## Barnz (May 21, 2010)

Hi,

My wife and I have just received a lease agreement to sign, however there are 2 clauses that are really making me think twice about signing.
They are as follows

1) The Landlord shall have the right to assign or transfer any of its rights and/or obligations under this contract without prior consent of the tenant.

AND

2) If the Tenant is leaving and needs to cancel the lease agreement before it's expiry, the Tenant shall pay 3 months rent as cancellation charges. Under no circumstances can the lease be cancelled

Are these standard clauses in Lease agreements here?
We've already paid a 'reservation' deposit to the agent before the lease agreement was presented to us, so I'm worried that if we change our minds now we will lose that.
In your experience, can I negotiate that clause out of the lease agreement?

Any and all help is welcome, as we need to find an apartment in the next 14 days!

Thanks in advance.


----------



## rsinner (Feb 3, 2009)

You can usually negotiate the agreement. 
I have not seen an assignment clause in the two agreements I have signed, but do not think it really is a big risk - though agreed that you are better off without it. However I would think that it is a "good to have" deletion than a "must have" deletion
The cancellation clause is fairly common as well though I have usually heard/seen two months of rent as cancellation charge (though I have a one month in my current agreement). Though I am confused by the part "Under no circumstances can the lease be cancelled" in this - isn't the first part of the clause talking about cancellation?


----------



## wandabug (Apr 22, 2010)

1).Ask the agent to explain this clause.
2). You are signing a year lease, the Landlord does not have to refund you anything if you leave before the end of the lease, however Landlord's are now offering a refund minus a penalty. RERA recommend 2 months penalty but this is only a guideline. 

The deposit is NOT binding until the Tenant signs the Contract. If you pull out at this stage the deposit must be returned to you. If you pull out after signing you may lose your deposit.

Check out the RERA website for all your rights as a Tenant and register your Tenancy Agreement with them as soon as both parties have signed it.


----------



## Barnz (May 21, 2010)

Hi Guys,

Thanks for the info. I am going to call the Agent this morning and clarify/negotiate around those 2 clauses.
Really appreciate the guidance as an Expat Noob


----------



## Bigjimbo (Oct 28, 2010)

wandabug said:


> 1).Ask the agent to explain this clause.
> 2). You are signing a year lease, the Landlord does not have to refund you anything if you leave before the end of the lease, however Landlord's are now offering a refund minus a penalty. RERA recommend 2 months penalty but this is only a guideline.
> 
> The deposit is NOT binding until the Tenant signs the Contract. If you pull out at this stage the deposit must be returned to you. If you pull out after signing you may lose your deposit.
> ...


Bit of a gray area this as agents are not entitled to the fee until the agreements are signed, but there are entitled to compensation for work done. Not very helpful I know but thats Law 26 for you!


----------



## Jumeirah Jim (Jan 24, 2011)

1) This is standard and fine. The landlord can sell and the new owner will become your new landlord and must respect the terms of the lease. Make sure your lease is registered at RERA. The agent should do this and its free. That way you should be protected if the new landlord tries to argue the lease is not binding on him.

2) This is negotiable and 3 months is quite a penalty. I had to accept the same clause in my current tenancy contract but took the view that as I was paying by 4 cheques and giving 3 PDCs (post dated cheques) then its unlikely I'll want to break the lease because the hassle of getting the PDCs back will be major. Unfortunately for the deal I reached I had to hand over PDCs and not pay cheques when they fall due. If you think its possible that you won't stay 12 months I strongly advise you not to hand over PDCs.


----------



## wandabug (Apr 22, 2010)

Handing over post-dated cheques at the beginning of the lease term is the norm.

A ''reservation deposit'' is not neccesary. No money should be handed over until you have seen the Tenancy Agreement at which point a security deposit is paid which is held till the end of the tenancy. 

Note to anyone looking to rent;
If you are not happy with any extra addendums to a Tenancy Agreement tell the agent you want the wording changed. At the end of the day he has done work for you and wants his commission so will not refuse. In the old days when there was a shortage of properties,the Landlords could demand all sorts of ridiculous clauses to the contracts (inc 1 year only). These days they have to back down a bit and it is your agents job to explain this to him.


----------

