Learn something new every day
More Info... by email
A flat lease is a type of lease agreement that commits the tenant to pay a fixed amount at specified periods throughout the duration of the contract. The terms of the flat lease contract will usually define the total amount that must be tendered over the course of the lease, breaking that amount down into equal installments to be paid on or by specific dates throughout the time period covered by the lease. In most instances, this approach calls for equal payments to be tendered monthly, although it is possible to create a flat lease agreement that calls for payments on a more irregular basis.
One of the best examples of a flat lease is a rental agreement associated with the leasing of an apartment. In most countries, governmental regulations require the text of the rental agreements to include a start and end date for the contract and the identification of the total amount of money the tenant is committing to pay the landlord. Along with defining the total amount for the duration of the lease, the provisions within the contract will also include a schedule that specifies an equal amount to be paid at defined intervals. Typically, the payments are structured on a monthly basis, with the monthly rental remaining the same for each successive month.
While the flat lease is most commonly employed with the rental of living space, the same general approach is often used in the rental of commercial buildings or office space. Tenants know in advance how much rent must be tendered for each period covered in the contract, and can make arrangements to make those payments on time. As with residential leases, contracts for commercial properties do often allow landlords to apply late fees and charges if the payments are not tendered according to the terms of the lease agreements.
The flat lease approach provides a format that is relatively convenient for all parties. Landlords can easily project the amount of income the property will generate for each calendar month, which in turn makes it easier to schedule payment of any expenses associated with owning and maintaining the rental property. For tenants, the establishment of a set schedule of payments makes it easier to arrange personal finances so that each payment is tendered on time, allowing the tenant to continue enjoying the property. Since the amount of the payments are fixed or set rather than varying from one payment to the next, accounting for both parties is kept relatively simple.