Rental Agreement in Bangalore – Complete Guide for Tenants & Landlords

Moving to Bangalore, the Silicon Valley of India, is an exciting journey. Known for its booming IT sector, pleasant climate, and cosmopolitan lifestyle, the city attracts thousands of professionals and students every year. As more people relocate for work and education, the demand for rental homes in Bangalore continues to grow.

Whether you are a tenant looking for your next home or a landlord renting out property, having a legally valid rental agreement in Bangalore is crucial. This agreement protects the rights of both parties, reduces disputes, and ensures transparency in rental transactions.

In this guide, you’ll discover everything about:

• The procedure to draft a rental agreement in Bangalore
• Stamp duty and registration charges in Karnataka
• Key clauses every agreement must include
• Types of rental agreements used in the city
• Requirements and legal precautions to follow
• How to quickly create a rental agreement online in Bangalore

Procedure to Draft a Rental Agreement in Karnataka

Traditionally, the rental agreement process in Karnataka involves:

• Drafting the agreement with all necessary clauses.
• Printing the agreement on stamp paper of due value.
• Signing by the landlord and tenant in the presence of two witnesses.
• Attestation of the agreement by witnesses.
• Registration of the document at the Sub-Registrar’s office, after paying the applicable charges.

This process can be time-consuming and involves multiple visits. Thankfully, with services like LegalDesk.com, you can now create a rental agreement online in Bangalore quickly, saving both time and money.

Stamp Duty and Registration Charges in Karnataka

Stamp duty is the government tax levied on legal documents to make them enforceable. For rental agreements in Karnataka, the stamp duty is:

• Up to 10 years: 1% of annual rent + deposit
• Above 10 years: 2% of annual rent + deposit

Registration charges: 1% of annual rent + deposit

Important: Not paying proper stamp duty or skipping registration can attract penalties up to 10 times the original value. Also, unregistered agreements are not valid as primary evidence in courts.

E-Stamping in Karnataka

Karnataka is one of the pioneers in e-Stamping. Today, traditional stamp papers are almost fully replaced by e-Stamp papers, which are:

• Easy to obtain from licensed vendors and cooperative banks
• Available in various denominations
• Secure and tamper-proof

This digital alternative ensures smoother rental documentation.

Is Notarization Required?

Notarization is not mandatory for rental agreements in Bangalore if the term is 11 months or less.

For leases of 12 months or more, registration is strongly recommended (not notarization). Registration acts as a fraud-prevention step and strengthens the enforceability of the agreement.

Key Clauses Every Rental Agreement in Bangalore Must Include

To ensure clarity and avoid future conflicts, every rental agreement Bangalore should cover the following clauses:

1. Lock-in Period: Minimum period before either party can terminate.
2. Rent & Deposit: Amount, mode of payment, and due dates.
3. Maintenance Charges: Who pays for electricity, water, and society fees.
4. Repairs & Alterations: Responsibility for damages or modifications.
5. Overstay Clause: Penalty if the tenant continues after the agreement expires.
6. Pets Policy: Whether pets are allowed on the premises.
7. Food Habits: If restrictions (like vegetarian-only) apply.
8. Late Payment Penalties: Fines for delayed rent payments.

Types Of Rental Agreements Commonly Used

11-month rental

In Karnataka, the term of renting is usually 11 months which can be renewed at the end of 11th month.The tenant has to pay a monthly rent. Additionally, the electricity and water charges are to be paid as per the usage. Check with the owner what is the rate per unit that is charged in the meter.

Long Term Lease

Another popular method of renting is the long term lease. In this, a lump sum amount is paid as a one-time deposit for a certain period or term of lease like 2 years or 3 years. The tenant or lessee does not pay any monthly rent. At the end of the lease period, the owner has to refund the entire deposit money without any interest. In a long-term lease, the benefit is that there is no hassle of paying monthly rent and a lot can be saved in this type of lease. There may be maintenance, electricity and water charges that need to be paid regularly.

Requirements for Renting in Karnataka

Before renting, both tenants and landlords should follow these requirements:

• The renting should be for either residential or commercial purpose.
• There should be a written agreement between the owner and tenant.
• The agreement should be printed on a Stamp paper of minimum value of Rs.100 or 200/-.
• Stamp duty is 1% of the total rent plus deposit paid annually or Rs. 500/- whichever is lower. So if you need to be on a safer side you can make the agreement on a Stamp paper of the appropriate value as prescribed by the government.
• The house or flat should be neatly painted and handed over to the tenant at the time of renting. At the time of vacating many owners make a deduction of painting charges from the deposit which depends on the agreement terms.
• Some owners request for only vegetarians and this should be disclosed before entering into the agreement.
• A rental agreement should be registered at a Sub-Registrar office if the term of the agreement is more than 11 months. If the term is less than 11 months, it is safer to still register it but is not mandatory. A registered and duly Stamped rental agreement is always a valid evidence in Courts if any legal disputes arise.
• Registration charges are 1% of the total annual rent and deposit that also should be paid at the time of registration.

Things You Should Know About Renting

Finding a place to rent for a comfortable stay is really a tiresome and time and energy consuming task. In Karnataka, the rent and lease are controlled by The Karnataka Rent Control Act, 2001. The person taking the house for rent is termed the Tenant/Lessee and the person letting out the premise is the Owner/Landlord/Lessor.

Before taking a premise for rent make sure these details:

• whether you are dealing directly with the owner
• whether there is an agent or broker to whom you need to pay a brokerage of one-month rent.
• verify the Identity of the Owner by asking for his/her ID proof and also whether the rental property belongs to the same person you are dealing with. For this, you can check the Electricity Bill or Tax Bill.
• In case you pay any token advance request for a receipt or try to make it by cheque, DD or online transfer.
• Talk all terms initially itself.

Deposit – Usually in Karnataka, 10 months worth of rent is collected upfront as the security deposit. In Bangalore, this is almost always followed. But in other popular cities like Mysore, Belgaum, Mangalore, Hubli-Dharwad and Davanagere it varies from 6 months to 8 months. Some of them may even charge only 2-3 months of rent as security deposit. You can negotiate on the deposit amount if it is too high. If the owner does not reduce the rent then request him to reduce the deposit amount.

Token Advance – Usually there is a system in Karnataka to pay a token advance before paying the full deposit amount. This is done in order to block the house by the tenant so that the owner does not give the house to any other person. But there is a lot of discrepancies in this. Many people fail to take a receipt while paying token advance. You should always create a proof of any payments done in a rental transaction either by way of cheque or DD or online transfer etc. If payment is made by cash, then request the owner to send you an SMS or get it in writing as a receipt of the payment.

But once a token advance is paid, the owner stops (or is expected to stop) showing the house to other tenants.

Sometimes you may decide not to proceed with the agreement and may want back the token advance paid. In such case, if the owner agrees to refund the full advance it is well and good. But if the owner undergoes any loss of money then he may deduct some amount from the token advance and return the same to you. but if your reason for withdrawing from the agreement is legally valid then you can claim the full amount back.

Making A Rental Agreement Online

LegalDesk.com offers a very convenient way to draft your rental agreement online and without the hassles of having to visit lawyers or look for stamp papers. You can also create a host of other legal documents with LegalDesk.com!

To create a rental agreement online-

1. Choose your State from the drop-down given below and click ‘Create Document’ button.
2. Fill in details of Landlord, Tenant & property to be rented out.
3. Add additional clauses if you wish to and customize the document as per your needs.
4. Review the document and print the soft copy yourself or allow us to print your deed on Stamp paper and mail it to you.
5. Sign the agreement and Register it at a local Sub-Registrar office.