Currently, there is approximately 35% of the Colombian population that lives rented, in addition, in the commercial real estate market, companies prefer to rent a premises or establishment over the purchase of it for their operations. Know the Requirements to Rent an Apartment and go through this simple process.
Leasing an apartment brings with it various costs, procedures, documents and restrictions that it is necessary to know for a better development of your home, below we will present all these aspects and much more so that you can formalize your lease.
Documents to proceed with the lease
The documents that must be presented to carry out the lease will vary depending on the condition of the person when going to a real estate agency, that is, the procedures are different if you are an employee, pensioner, independent worker or for a legal person.
In all cases of natural persons, the identification card is essential to formalize the lease, on the other hand, the corresponding documents must be delivered to each person, which we will highlight below:
Employees
In addition to the identity card expanded to 150%, employees must deliver:
- Labor Certificate in original format with a validity of no more than thirty (30) days.
- Proof of salary, position and time of provision of services in the company.
- Payroll payment corresponding to the last 3 months.
- Last three (3) bank statements.
- All those documents that prove and refer to other income received, if applicable.
Pensioners
Pensioners must submit to the real estate agency:
- Copy of identity card enlarged to 150%.
- Certificate of Tradition.
- Certificate free of encumbrances (no more than 60 days).
- Pensioners must deliver all those documents that prove other income (in addition to the pension) if applicable.
- Last three (3) proof of payment.
- Last three (3) bank statements.
- Simple copy of the Single Tax Registry (RUT).
Independent worker
If you are an independent worker, you must deliver the following documents:
- Citizenship card extended to 150%.
- Certificate of Tradition.
- Tax-free exercise valid for no more than 60 days (if applicable).
- Documents that refer to other income earned by the independent worker (if applicable).
- Bank statements for the last three (3) months.
- Chamber of Commerce no longer than 60 days.
- Simple copy of the Single Tax Registry.
- Income Statement.
Legal persons
Legal or moral persons must provide the following documents:
- Certificate of Tradition.
- Certificate of incorporation and management of the entity.
- Freedom of duty free of no more than 60 days (if applicable).
- Documents that prove other income (if applicable).
- Bank statements for the last 3 months.
- Chamber of Commerce (no more than 60 days).
- Simple copy of the Single Tax Registry.
- Simple copy of the last Income Statement.
- Financial Statements of the last accounting period signed by a Public Accountant.
- If the company is recently constituted, the company must present documentation related to the partners showing and certifying the income and ability to pay.
For the apartment owner
The landlord or owner of the apartment must also comply with a series of obligations to carry out this real estate operation for the purpose of a temporary exchange of a home in exchange for rent.
For the landlord it is essential to present each of the documents that we highlight below:
- House Energy Certificate: It is essential that the home to rent has the certificate received from the competent body, which indicates that the space meets all the necessary energy efficiency requirements according to the Law.
- Certificate of Habitability: The house must be rented with a permanent functionality through a contract, otherwise the space will be considered a local.
- Documents that validate the Property: It is essential to demonstrate to the tenant that the house is in the owner’s name, this is done through the property title of the house.
Who rents the apartment for
For the person requesting the lease called «tenant» there are special requirements, either by law or considerations related to use.
In the lease contract, it is obliged to temporarily transfer the use, enjoyment and disposition of the leased real estate to another that undertakes to pay an amount of money for said use.
However, said apartment lease contract goes beyond just leasing, there are obligations between both parties that must be agreed upon in said contract, protection by the Law and important considerations regarding the use, payment, eviction and restitution of the property. .
Below we will explain the conditions that apply only to tenants and the procedure they must carry out to formalize the process:
- Carry out the delivery of the previously expressed documents, depending on the condition you have (independent worker, pensioner, etc.) for the formal request for the lease and, later, cancel the related expenses.
- Complete the lease by submitting the application, duly filled out and signed by the interested party.
- Take into account four (4) specific aspects:
- The interested party must prove certified income that is at least twice the rental fee.
- The rental fee, being less than 500,000 pesos (this average value varies according to the surety or insurer), must present a co-debtor who has certified income equivalent to twice the rental fee.
- If the rental fee ranges between 501,000 and 1 million pesos (this average value varies according to the surety or insurer) you must accredit two co-debtors. One must have a real estate and the other must be employed with certified income equal to twice the rental fee, at least.
- In the event that the rental fee is greater than 1 million pesos (this average value varies according to the surety or insurer), the two guarantors must have real estate.
Finally, when delivering all the corresponding documents to the surety, within a period of 4 to 24 hours a response is given to the interested parties and the owner regarding the acceptance or not of the rental application.
In the event that the answer is negative, the interested parties may make a request for a new study with the documents and co-debtors attached, however, attention must be paid to the recommendations of the insurer.
If the answer is positive, the real estate agency is in charge of making the contract and invites the parties to its facilities to sign it.
In some cases it is necessary to cancel some rights for the elaboration of the contract, equivalent to 10, 15 or 20 percent on the rental fee.
Lease insurance
The Leasing Insurance has the purpose of offering support to both the owner and the tenant, supervising the due fulfillment of the obligations of both parties.
The monthly payment of the lease is one of the most important points covered by the insurance, together with the administration fees and public services of the home while the insurance contract is in force.
The process to acquire this insurance is not simple, since both the owner and the tenant must meet certain requirements to exercise the lease successfully.
The landlord or owner must guarantee the tenant certainty regarding the availability of the property and how viable the lease would be, below we highlight the steps to process the rental insurance:
- The owners must present the certificate of tradition and freedom of the property that proves that the ownership is yours and is free of domain limitations.
- If the rental fee is less than $ 1,500,000, the tenant must present a solvent co-signer that has at least 50% of a property in Colombia. If the lease is above $ 1,500,000, you must present two solvent co-debtors, who accredit real estate in Colombia. The properties to be registered must be free of any domain limitation.
- Tenants and co-debtors must present all the documentation that proves your solvency, obligatorily higher than DOUBLE the rental fee. Additionally, they must present the documents that certify what your work activity is, as well as the certificate of tradition and freedom of the property to be registered.
- Applicant must have citizenship or immigration card. Insurers do not approve candidates with passports as identification.
- Once the documentation is filed with the chosen insurer, the tenant must pay the cost of the study according to the rental value: between $ 500,000 and $ 700,000 you will have to pay about $ 30,000 + VAT; between $ 700,000 and $ 1,100,000 you must pay $ 43,000 + VAT approximately; from $ 1,100,000 onwards, 5% of the rental fee + VAT must be paid; From $ 8,000,000 onwards, approximately $ 400,000 + VAT must be paid.
- The owner of the property must pay a policy, which is equal to 50% of the rental fee. This will be paid once the lease has been signed, and will be valid for one year (renewable).
Leasing Insurance works as a guarantee to the parties to protect themselves from any inconvenience that may arise during the lease, therefore, it is worth the effort despite the fact that it is the most complex route.
By presenting this Insurance, the owner of the property will have the peace of mind and security that, in the event of late payments, the insurer will respond for the money that has stopped receiving and it will be in charge of executing a legal process with the delinquent tenant .
In the case of the tenant, you will have the assurance that you will be able to dispose of the property you are renting in a way free of domain limitations.
CDT conditions
If a person duly complies with the personal requirements to rent a home but does not have the “co-debtors”, they can opt for other types of guarantees so that the study of the lease is approved.
For this, insurers offer the option of constituting a CDT in the name of the lessee with endorsement to the insurer during the term of the contract, that is, until the term of the contract ends.
The amount that will be placed for this purpose will depend on the study carried out of the documents, establishing a minimum of four (4) monthly payments.
When carrying out this process, some procedures must be prepared, such as a letter of endorsement issued by the insurance company, bank documents and certification that the title is endorsed as collateral in favor of the insurance company.
When the lease contract is expired and the leased property is returned, the tenant has the duty to present a peace and save duly signed by the landlord in order to ensure that the tenant is up to date in all your payments and obligations.
In addition, a letter must be delivered to the insurance company containing the request for the reimbursement of the title.
Lease payment methods
The forms of payment in the leases are normally agreed by the owner and tenant where they agree, through a contract, the advance payment of several months of rent. In this way, all the formalities involved in taking out rental insurance are avoided. However, this measure can be counterproductive for the owner in case of inflation or wants to shorten the lease term.
The fact that a person has solvency at the time of making advance payments does not guarantee that they are financially stable to pay off their debts and future obligations or that they have the seriousness and ethics necessary to meet the payments later.
If you are a landlord, you should analyze your collection strategy very well, since there are many cases in which landlords have accepted the cancellation of several months or even a year in advance and at the beginning of the next period the tenant begins to present a default. , delays or even lack of obligations (payments).
On the other hand, there have been various cases in which there are parties that agree to cancel a security deposit that is equivalent to one or more monthly rent and in the same way, this agreement between the tenant and the owner is limited by law.
It should be noted that article 16 of Law 820 of 2003 expressly prohibits the requirement of deposits to guarantee the fulfillment of the tenant’s liabilities, however, article 15 allows the owner to require the provision of bonds that guarantee the payment of public services to the corresponding entities.
Understanding this, we can establish that the rental payment must be discussed, discussed and analyzed by both parties before the conclusion of the contract to guarantee compliance with the rights and obligations of both parties.
Recommendations for renting an apartment
After reading all the procedures, requirements and conditions involved in renting an apartment, we will give you some recommendations to better face this process, whether you are an owner or a tenant.
It is no secret to anyone that renting a property directly between both parties is a much more agile and less expensive alternative for both the landlord and the tenant, however, this carries with it a risk that could generate future losses if not you know how to manage the process properly.
The risk of opting for this option is considerable, taking into account the importance of the possibility of not receiving the consideration for the service provided due to late payments or late payments by the tenant.
When this situation arises on a recurring basis, it would be necessary to go to lawyers and various legal processes, which entail a loss of time and money that could have been avoided with the participation of an insurer in the process.
Similarly, for the tenant it means avoiding a possible problem managing the leasing process through a third party, which would be the real estate.
In conclusion, the monitoring of all Requirements to Rent an Apartment Together with the documents, conditions and procedures with the insurer, it can represent a complicated and long process but it guarantees the fulfillment of your rights and obligations in an efficient, efficient and effective way.