What is an extension of lease?

Extension of lease is an agreement that expands the term of a rental understanding. The extension of lease report should name parties to the agreement, give the dates on which the extension starts and finishes, and reference the prior understanding that is being extended. Lease installments don't need to continue as before under a lease extension.

Extension of lease

An extension of lease is a continuation of the first lease, without interruption. A lease extension could be executed between a landowner and an occupant when the occupant's lease is going to lapse and they need to keep leasing the property. Another circumstance where a lease extension may be attractive is if a customer is renting a vehicle from an automobile dealership and selects to lease or buy a different vehicle toward the finish of the lease term, yet needs to incidentally keep utilizing the first leased vehicle in case the replacement vehicle is not available. It is also beneficial in freehold purchase.

As a rule, tenants may lean toward an alternative to extending the lease since it proceeds with all rights under the lease that are close to home to the occupant. Nonetheless, a choice to expand the lease may have potential advantages to the landowner also, for example, in situations where the lease has been allocated and the owner plans for the first occupant to remain liable during an extended term.