Lessors can demand advanced payment of rent

Persida Acosta

Persida Acosta

Dear PAO,
Is there a law which allows a lessor of a residential apartment to compel his lessee to give a deposit and advance payment of rent? May the lessee recover these upon the termination of the lease agreement?

Dear AJ,
Republic Act (R.A.) No. 9653 is the law which governs and regulates the leasing of residential units in our country. Residential units refer to an apartment, house and/or land on which another dwelling is located and used for residential purposes and shall include not only buildings, parts or units thereof used solely as dwelling places, boarding houses, dormitories, rooms and bed spaces offered for rent by the owners, except motels, motel rooms, hotels, hotel rooms, but also those used for home industries, retail stores or other business purposes if the owner thereof and his or her family actually live therein and use it for dwelling purposes (Sec. 3(b). This law provides for certain rules and regulations which both the lessor and the lessee shall observe during the term of their lease. One of these pertains to the requirement of deposit and advance payment of rent. Section 7 thereof provides:

SEC. 7. Rent and Requirement of Bank Deposit. – Rent shall be paid in advance within the first five days of every current month or the beginning of the lease agreement unless the contract of lease provides for a later date of payment. The lessor cannot demand more than one month advance rent. Neither can he/she demand more than two months deposit which shall be kept in a bank under the lessor’s account name during the entire duration of the lease agreement. Any and all interest that shall accrue therein shall be returned to the lessee at the expiration of the lease contract. In the event however, that the lessee fails to settle rent, electric, telephone, water or such other utility bills or destroys any house components and accessories, the deposits and interests therein shall be forfeited in favor of the latter in the amount commensurate to the pecuniary damage done by the former.

Hence, a lessor may legally require his lessee to pay deposit and advance rent subject only to the limitations provided under the law. Once all the utility bills of the lessee were settled and he is not liable for any damage sustained by the leased premises, the lessee may demand from the lessor the return of the remaining balance from the advance rent and deposit that he paid. If upon demand the lessor unjustly refuses to return the same, the lessee may compel him by instituting a collection case against him before the court.

We hope that we were able to answer your queries. Please be reminded that this advice is based solely on the facts that you have narrated and our appreciation of the same. Our opinion may vary when other facts are changed or elaborated.

Editor’s note: Dear PAO is a daily column of the Public Attorney’s Office. Questions for Chief Acosta may be sent to dearpao@manilatimes.net


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