Difference Between Lessor, Lessee and Guarantor: Do You Know What They Are?

Are you going to rent a property? So it is good to understand the difference between lessor, lessee and guarantor, so that when signing the contract you know exactly what are the duties and rights of each one.

Difference between lessor and lessee

Whatever the type of property, the rental agreement will always address two main people: the lessor and the lessee.

And there are significant differences not only in the role that each one assumes, but in responsibilities and rights. See below:

Who is the landlord?

The lessor is the one who owns the property, that is, the owner of the property being rented. This person (it can also be a company or private company) is the one who will receive each month for the rent in exchange for the use of the property made by another person or company.

Who is the tenant?

The tenant, popularly also known as a tenant or tenant, is the person who is renting the property, whether to live or to establish a company or business.

This person undertakes to care for and care for the property as if it were his for the entire term of the contract.

Tenancy Law

When renting a property, both the lessor and the lessee must assume all their duties, as well as their rights must be preserved.

This is what the Tenancy Law guarantees, as Law No. 8245 of 18 October 1991 became known.

This law is responsible for regulating all residential and commercial rental contracts in Brazil. Among other things, it provides, in articles 22 and 23, the rights and duties of landlords and tenants, as follows:

Lessor's rights and duties under the Tenancy Law

I – deliver the rented property to the lessee in a condition to serve the intended use;

II – guarantee, during the lease period, the peaceful use of the leased property;

III – maintain, during the lease, the form and destination of the property;

IV – answer for vices or defects prior to the lease;

V – provide the lessee, if requested, with a detailed description of the condition of the property, upon delivery, with express reference to any existing defects;

VI – provide the lessee with an itemized receipt of the amounts paid by him, generic discharge being prohibited;

VII – pay real estate administration fees, if any, and intermediation fees, including the expenses necessary to assess the suitability of the applicant or its guarantor;

VIII – pay taxes and fees, as well as the complementary fire insurance premium, which are levied or will be levied on the property, unless expressly provided otherwise in the contract;

IX – display to the lessee, when requested, the receipts related to the installments that are being required;

X – pay extraordinary condominium expenses.

Single paragraph. Extraordinary condominium expenses are those that do not refer to routine building maintenance expenses, especially:

a) renovation works or additions that are of interest to the entire structure of the property;
b) painting of facades, gables, aeration and lighting wells, as well as external frames;
c) works aimed at restoring the building's living conditions;
d) labor and social security indemnities for the dismissal of employees, occurred on a date prior to the beginning of the lease;
e) installation of security and fire equipment, telephony, intercom, sports and leisure;
f) decoration and landscaping expenses for parts of common use;
g) creation of a reserve fund.

Tenant's rights and duties under the Tenancy Law

I – punctually pay the rent and lease charges, legally or contractually required, within the stipulated period or, failing that, until the sixth business day of the month following expiration, in the rented property, when another location has not been indicated in the contract ;

II – use the property for the agreed or presumed use, compatible with its nature and with the purpose for which it is intended, and treat it with the same care as if it were your own;

III – return the property, once the lease ends, in the state in which it was received, except for the deterioration resulting from its normal use;

IV – immediately bring to the notice of the lessor the appearance of any damage or defect whose repair is incumbent on it, as well as the possible turbidity of third parties;

V – carry out the immediate repair of damage to the property, or its facilities, caused by you, your dependents, family members, visitors or agents;

VI – not to modify the internal or external form of the property without the prior and written consent of the lessor;

VII – immediately deliver to the lessor the documents for the collection of taxes and condominium charges, as well as any subpoena, fine or requirement of public authority, even if addressed to him, the lessee;

VIII – pay telephone and power consumption, electricity and gas, water and sewage expenses;

IX – allow inspection of the property by the landlord or its agent, by means of a prior combination of day and time, as well as admitting that it is visited and examined by third parties, in the event provided for in art. 27;

X – fully comply with the condominium convention and internal regulations;

XI – pay the surety bond premium;

XII – pay ordinary condominium expenses.

1º Ordinary condominium expenses are those necessary for the respective administration, especially:

a) salaries, labor charges, social security and social contributions of employees of the condominium;
b) consumption of water and sewage, gas, light and power in areas of common use;
c) cleaning, maintenance and painting of common facilities and facilities;
d) maintenance and conservation of hydraulic, electrical, mechanical and safety installations and equipment, in common use;
e) maintenance and conservation of facilities and equipment in common use for sports and leisure;
f) maintenance and conservation of elevators, intercom and collective antennas;
g) minor repairs to electrical and hydraulic installations and installations in common use;
h) apportionments of the outstanding balance, except if referring to the period prior to the beginning of the lease;
i) replacement of the reserve fund, wholly or partly used to finance or supplement the expenses referred to in the preceding paragraphs, except if referring to the period prior to the beginning of the lease.

And the guarantor, who is it?

The guarantor may also appear within a lease agreement. But how important is it in this process?

The guarantor is the one responsible for the property's debts that, perhaps, the tenant (tenant) is no longer able to assume. Generally, to be a guarantor, a person must have his / her own property registered in deed. It is precisely this property that will serve as collateral in case of tenants' debts.

The figure of the guarantor is important to ensure that the landlord receives all amounts relating to the property, not only the monthly payment of the rent, but also the payment of electricity, water, sewage and gas bills in the name of the property.

The guarantor may be a person, as well as another type of guarantee for the lessor, such as a surety bond or surety bond.

Security deposit

In the absence of the traditional guarantor, the lessor can ask the lessee for a deposit, that is, the amount corresponding to three months' rent. This money deposited in the lessor's account must be returned to the tenant at the end of the contract, provided that the lessee has not left debts and the property is in the same conditions of use.

Otherwise, the money left as a deposit can be used by the landlord to pay the tenant's debts and / or make the necessary repairs to the property.

Bail insurance

Bail insurance is another way of securing the lease on the property. This insurance can be contracted directly with banks or insurance companies that offer the service and can be activated by the lessor to cover eventual needs.

Care the landlord must take

Always count on the support and support of a real estate company;
Offer receipts for all rentals paid by the tenant;
Formalize the lease through a contract, avoiding “mouth” or informal agreements;
Decriminalize in the contract the maximum possible situations that guarantee the duties and rights of both the lessor and the lessee

Care the renter must take

Never sign a lease without understanding all the items described in the document;
Require receipts for all payments;
Count on the support of a real estate agent or lawyer;

Care that the guarantor must take

Never accept to be guarantor of a little known or suspicious person;
Avoid being a guarantor in the event of poorly drafted contracts or dubious features, especially when you are not sure what the property will actually be used for;
Count on the support of a lawyer and never sign anything without having an absolute understanding of all the clauses of the contract.

Now that you know the difference between landlord and tenant, just read everything right and close a good deal!