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Typical interpretation of standard TA and Diplomatic clause

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zzm9980
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Typical interpretation of standard TA and Diplomatic clause

Postby zzm9980 » Thu, 25 Apr 2013 10:57 am

Hi,

Yes, I've been on this board long enough to know nothing is really 'typical' and every TA, agent, landlord, situation, etc is different, but I still want to gather feedback on this:

Typical TA is for two-years, with an option to renew or extend for one year at market rates.

Typical 'diplomatic clause' says that with two months notice (or two month's rent payment), you can exist your lease if you're leaving Singapore for work reasons *after* staying a minimum of twelve months.

If a person were to take the option to extend their TA by one more year, can they still invoke the diplomatic clause into that extension? e.g., does the landlord see it as the third year of the lease with at least 12 months already served? Or is it seen as a new lease from scratch and now you haven't fulfilled the 12-month prerequisite?

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Re: Typical interpretation of standard TA and Diplomatic cla

Postby the lynx » Thu, 25 Apr 2013 11:38 am

zzm9980 wrote:Hi,

Yes, I've been on this board long enough to know nothing is really 'typical' and every TA, agent, landlord, situation, etc is different, but I still want to gather feedback on this:

Typical TA is for two-years, with an option to renew or extend for one year at market rates.

Typical 'diplomatic clause' says that with two months notice (or two month's rent payment), you can exist your lease if you're leaving Singapore for work reasons *after* staying a minimum of twelve months.

If a person were to take the option to extend their TA by one more year, can they still invoke the diplomatic clause into that extension? e.g., does the landlord see it as the third year of the lease with at least 12 months already served? Or is it seen as a new lease from scratch and now you haven't fulfilled the 12-month prerequisite?


Although I can't remember the contents of a TA any more, I'd assume that the diplomatic clause only serves if you have to terminate before the END of the lease (and having stayed for one year and above before you do so). So if you're extending a lease, the diplomatic clause is no longer necessary.

Another way to look at it is that you have already paid 2-month rent's deposit to enter the 2-year lease. An extension of lease does not require additional deposit on top of what you have already paid. Hence it will not be treated as new lease. AND the diplomatic clause is no longer in effect because you have already served the full term of the original lease.

Please correct me if the above is inaccurate. :)

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Re: Typical interpretation of standard TA and Diplomatic cla

Postby zzm9980 » Thu, 25 Apr 2013 12:03 pm

the lynx wrote:Another way to look at it is that you have already paid 2-month rent's deposit to enter the 2-year lease. An extension of lease does not require additional deposit on top of what you have already paid. Hence it will not be treated as new lease. AND the diplomatic clause is no longer in effect because you have already served the full term of the original lease.

Please correct me if the above is inaccurate. :)


I definitely don't need the pay any more deposit, the existing would carry over. That I know. But your reasoning doesn't explain why the diplomatic clause would go away. What if my company wants to move me 30 months into being here?

And yes, I'm exploring my Plan B. Unfortunately my potential ticket off this island will be about 3 months after I have to renew my lease.

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Postby Saint » Thu, 25 Apr 2013 12:12 pm

You are just exending your current TA and the same conditions apply as per the original TA. So yes your Dip Clause still stands.

Every time I've extending my TA I have just a single page document that details the extension, the additional Stamp Duty and that all terms of the original TA are still in place.

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Postby the lynx » Thu, 25 Apr 2013 12:21 pm

Saint wrote:Every time I've extending my TA I have just a single page document that details the extension, the additional Stamp Duty and that all terms of the original TA are still in place.


Strange, my previous landlady did not include this document when I extended my lease. But that would certainly be helpful!

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Re: Typical interpretation of standard TA and Diplomatic cla

Postby offshoreoildude » Thu, 25 Apr 2013 12:59 pm

zzm9980 wrote:
the lynx wrote:Another way to look at it is that you have already paid 2-month rent's deposit to enter the 2-year lease. An extension of lease does not require additional deposit on top of what you have already paid. Hence it will not be treated as new lease. AND the diplomatic clause is no longer in effect because you have already served the full term of the original lease.

Please correct me if the above is inaccurate. :)


I definitely don't need the pay any more deposit, the existing would carry over. That I know. But your reasoning doesn't explain why the diplomatic clause would go away. What if my company wants to move me 30 months into being here?

And yes, I'm exploring my Plan B. Unfortunately my potential ticket off this island will be about 3 months after I have to renew my lease.


IME your deposit should be halved actually if you're going from a two year to one year lease (i.e. 2 months down to 1 month).
Now I'm called PNGMK

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Postby zzm9980 » Thu, 25 Apr 2013 1:53 pm

Saint wrote:You are just exending your current TA and the same conditions apply as per the original TA. So yes your Dip Clause still stands.

Every time I've extending my TA I have just a single page document that details the extension, the additional Stamp Duty and that all terms of the original TA are still in place.


Thanks, this is my assumption as well, but just wanted to make sure I wasn't assuming wrongly.

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Re: Typical interpretation of standard TA and Diplomatic cla

Postby zzm9980 » Thu, 25 Apr 2013 1:54 pm

offshoreoildude wrote:IME your deposit should be halved actually if you're going from a two year to one year lease (i.e. 2 months down to 1 month).


Wouldn't that be nice!

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Postby x9200 » Thu, 25 Apr 2013 2:30 pm

12 month of waiting for the diplomatic clause (DC) is for the LL to recover the initial expenses:
- agent's commission
- repainting of the apartment (etc.) if applicable.
Apparently after 12 months it is consider spent or close to it so regardless this is an extension or a new contract I would make the presence and extent of DC dependent on the new expenses incurred by LL. I.e. if the LL paid the agent again upon renewal and the contract is for 1y only there would be no DC. If the next contract is for 2ys and he paid nothing, than DC should continue from the previous contract (so it kicks off right from the start of the new one) etc. ect.
For the deposit it is a bit less logical but I typically do it as for any contract so 1y extension (or contract for 1y) 1m deposit, 2 - 2.

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Re: Typical interpretation of standard TA and Diplomatic cla

Postby x9200 » Thu, 25 Apr 2013 2:33 pm

zzm9980 wrote:
offshoreoildude wrote:IME your deposit should be halved actually if you're going from a two year to one year lease (i.e. 2 months down to 1 month).


Wouldn't that be nice!

I have done it twice already and had no objections from the LL of any kind.

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Re: Typical interpretation of standard TA and Diplomatic cla

Postby zzm9980 » Thu, 25 Apr 2013 3:21 pm

x9200 wrote:
zzm9980 wrote:
offshoreoildude wrote:IME your deposit should be halved actually if you're going from a two year to one year lease (i.e. 2 months down to 1 month).


Wouldn't that be nice!

I have done it twice already and had no objections from the LL of any kind.


Wow, I'll try it then. Assuming rent doesn't go up and force me to move.

Did they do a walk-through and inspection for damages between the two tenancy terms?

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Re: Typical interpretation of standard TA and Diplomatic cla

Postby x9200 » Thu, 25 Apr 2013 4:30 pm

zzm9980 wrote:
x9200 wrote:
zzm9980 wrote:
offshoreoildude wrote:IME your deposit should be halved actually if you're going from a two year to one year lease (i.e. 2 months down to 1 month).


Wouldn't that be nice!

I have done it twice already and had no objections from the LL of any kind.


Wow, I'll try it then. Assuming rent doesn't go up and force me to move.

Did they do a walk-through and inspection for damages between the two tenancy terms?

No, never, maybe because I invited them voluntarily to do this before that thought even occurred to them.


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