Leaving your rented flat before the lock-in period ends? Here’s what happens to your security deposit
A lock-in period in a tenancy agreement is meant to provide certainty for both tenants and landlords. It assures tenants of a place to stay while giving landlords a steady rental income.However, in case of unpredictable circumstances like a job transfer, illness or a family emergency, one may be forced to move out before the agreed period ends.But does moving out early mean losing your security deposit? Here’s how the law deals with such situations.While no one can stop a tenant from leaving a rented property whenever they wish, the consequences of doing so depend on the terms of the rent agreement. A job transfer, illness or family emergency does not, by itself, cancel the lock-in period. Unless the agreement specifically provides an exception, the tenant may still be liable for the consequences of terminating the tenancy early.According to Section 73 of the Indian Contract Act, 1872, a party suffering loss because of a breach of contract can claim compensation for the loss or damage caused by the breach. Section 74, which specifies a sum payable in the event of a breach, allows the aggrieved party to claim reasonable compensation, but not exceeding the amount specified in the contract.This means that a landlord may have a legal basis to make deductions from a security deposit if the tenant’s early exit breaches the agreement.Before signing a rent agreement, it is advisable to carefully check the clauses relating to the lock-in period, notice period, early termination and security deposit. If you need to leave the property early because of unavoidable circumstances, inform the landlord in writing and try to negotiate a mutual termination of the tenancy.Most importantly, do not assume that a security deposit will automatically be withheld or returned without first checking the terms of the agreement and the applicable law.
