Country gets a good deal of revenue from an army of 32 million NRIs. The source of income is described as a major one from overseas. The NRIs often send money to families and also for investing in property in the homeland. Since long, they are investing in realty sector of the country. The objective of their investment would be mostly building homes, improving their lifestyle and to earn sizeable passive income through rents. But, some of the problem areas would be maintenance of property, collection of rent periodically and ensuring safekeeping of property. Now that the investors are living in a far away nation, it is not easy to manage all these issues. In this backdrop, services like rental bonds and managed accommodation have been introduced recently. These services are helpful in collecting rents and managing properties.
Rental Bond is an instrument of agreement reached between landlord, tenant and guarantor. The bond constitutes an institutional guarantee to cover losses of the landlord. At the time of renting out a flat, the two major hurdles would be inability of the land lord to get the flat vacated and recovering dues from tenants. From the tenant’s perspective, he or she has to provide 10 months’ rent towards security deposit. The landlord collects the amount to bridge the losses caused to him or her by tenant. However, the security deposit becomes huge burden for small employees. In this context, the rental bond resolves the problem.
The rental bond is the surety provided by a third party firm to the landlord on behalf of the tenant. The written agreement gives written undertaking to make good the losses caused to land lord by the tenant. Failure to pay rent on time, loss caused to property by tenant, violation of lock-in period, unpaid utility bills are covered as part of the bond.
