Subleasing’s Dos and Don’ts

Understanding the dos and don’ts of subleasing may assist renters and landlords avoid potentially difficult legal situations.

Subleasing your rental apartment is a terrific option for renters to reduce living expenses or pay rent when a roommate goes away. Finding a subletter may seem attractive if you can add a roommate or are preparing to relocate out of town or travel for an extended length of time. Subleases may have certain benefits for landlords as well, and enabling them may be legally mandated. However, there are several hazards associated with subleasing. Fortunately, understanding the dos and don’ts may aid in the seamless operation of your subleasing business.

Check Your Lease Agreement Before Subleasing

The ability to sublease all or a portion of a rental property, including adding a new roommate, is sometimes contingent on whether the Lease Agreement enables it. Subleasing is normally acceptable if your lease does not specifically prohibit it. The landlord’s Consent to Sublease, as well as the landlord’s approval of any new subtenant, is required in most leases. Even if an agreement does not specifically include subleasing, renters may wish to consult with their landlord first to preserve a healthy landlord-tenant relationship.

Many states and local governments have rules that control a tenant’s ability to sublet. These regulations may allow you to sublet even if your lease expressly prohibits it. In New York City, for example, if you reside in a building with four or more apartments, you may sublease your apartment even if the lease agreement expressly bans it.

You may replace any leaving roommates on a one-for-one basis in San Francisco, as long as the new roommate fulfills your landlord’s application screening criteria. For instance, if the potential tenant has a worse credit score than the landlord generally demands, the landlord may forbid you from subletting to that individual.

Do: Understand Your Sublease Relationship

It is critical to note that renters are forming a new and unique legal relationship with the subletter. The tenant that offers the sublease becomes the principal tenant, while the new renter becomes their subtenant.

The principal tenant’s connection with the landlord stays unchanged. This implies that if you sublease, you will still be accountable to your landlord for all of the provisions of your Lease Agreement. For example, if the new subtenant fails to pay rent for two months, you are obligated to your landlord for the money (plus the inevitable late fines). As a result, the subtenant is responsible to you for the rent they did not pay.

Do: Inquire with Your Landlord

Lease agreements sometimes require renters to get approval from their landlord before subleasing their rented unit. Obtaining a landlord’s clearance to sublease is an excellent approach to prevent any future issues that may emerge during sublet, regardless of whether your agreement demands it. A main tenant may seek their landlord’s assistance or cooperation if evicting the subtenant or taking other action is required.

Furthermore, when subletting or bringing in a new roommate, a main tenant may be needed to acquire the permission of their landlord. State and municipal regulations often prevent landlords from withholding their approval of the potential subtenant in an unreasonable manner. Unreasonably withholding permission often indicates that a landlord rejects a subtenant who meets their normal and reasonable application criteria.

Subleasing Dos and Don’ts Do not Sublease to Just Anyone

When a sublease is signed, a new legal relationship with the subletter is created, which allows them to certain rights. If the subtenant fails to pay their rent or causes damage to the property, the principal tenant is ultimately accountable. However, if this happens, landlords may face delays in obtaining rent or fixing their property.

It is critical to thoroughly examine any potential subtenant, including confirming their income, doing a credit check, and contacting previous landlords.

Running the same application screening procedure that your landlord did on you when you applied for the rental unit will help you avoid problems receiving your landlord’s approval.

Do not Think You Can Charge More.

It may be all too tempting in places with rising rents to charge your subtenant more rent than you pay your landlord. In general, you are free to charge whatever you want. However, in rent-controlled places such as New York and San Francisco, local rules restrict a main tenant from charging a subtenant more than a fair and proportionate part of the rent stipulated in the Lease Agreement. In brief, as a main tenant, you may not be allowed to benefit from the rental property in places with robust renter rights. Check your local regulations to see whether charging extra is legal in your city and state.

Do not forget to look at alternatives.

Subleasing may assist landlords maintain properties occupied while renters are gone for lengthy periods of time, cut living expenses, and replace housemates. Subleasing, on the other hand, adds legal complication and danger. Among the alternatives are:

Completing a Lease Amendment in order to add a new roommate. This eliminates the intricate interaction between principal and subtenant.
A Lease Assumption or Lease Assignment may be acceptable if a tenant is relocating and does not intend to return and has a new renter lined up.
If a tenant moves and does not intend to return, another option is to enter into an Agreement to Cancel Lease, which allows a landlord to transfer the unit over to a new renter.