Sunday, January 16, 2011

Paying Advance and Canceling - Who is Benefited?

I was searching for a house, and found one house, which suited many of my requirements, but not all. The rent for that house was Rs.6,000 and a deposit of Rs.35,000. I was not sure, whether I can get better house than that. So, I decided to take it, and paid an advance of Rs.1,000. After few hours, I realized that, it may be little difficult to adjust in that house, and I continued my searching for five days, and found another house. Immediately after finding the house that satisfied all my requirements, I told the previous house owner that, I would not take that house, and I lost the advance.

Who got benefited out of this?

The room rent is Rs.6,000 per month. For 5 days, it would be around Rs.1,000. Since, I reserved that room for 5 days, I paid Rs.1,000 for that. So, I was not in loss. The same thing with the house owner. But, the house owner might have more loss, if he was using paid advertisements, and he might have lost few potential tenants.

Many people do not understand this and think that I lost money in this, where as I did not lose anything.


  1. You definitely made a point here, but, you forgot to mention the fact that you are paying rent somewhere else for those 5 days. And you are paying the house owner with out staying in there.

  2. I thought, it was obvious. That's why I did not mention.

    To give more background, my employer was paying around Rs.2000 per day as rent for the place I am staying. If I don't search the house by the dead line, I would have to pay the rent. That's why, it was even more important to have a house as backup.