Key terms and definitions

Obtaining landlord permission, tenants and subtenants responsibilities and liabilities, protecting the tenant from sublease pitfalls, putting the agreement in writing, alternatives to subleasing, final takeaways, templates and examples to download in word and pdf formats, tenants and subtenants obligations under a sublease agreement.

From finding a new job in another state to returning home to care for a sick family member to taking the big step of moving in with a new partner, many people find themselves in a situation where they need to cancel their existing lease so they can move somewhere else. Unfortunately, many landlords are reluctant to cancel existing leases, since that puts them in the position of potentially losing money while they look for a new tenant to fill the space. However, there is a solution that is workable for tenants while also being amenable to many landlords: a Sublease Agreement , also known as a sublet. There are many misconceptions about how subleases work and the responsibilities of people involved. This guide will walk through the most important terms to know and the main issues to be aware of when creating a sublease arrangement:

1. Differences between a sublease and an assignment

2. How to get permission from a landlord to sublet

3. Responsibilities and liabilities of the tenant and subtenant

4. Protective measures for the tenant

5. Sublease alternatives

There are many terms used in subleasing that are often used interchangeably and in confusing ways. However, the key distinction is between subleases and assignments . Both of these can be easily created, but have different legal implications and responsibilities for the involved parties that will be explored further in this guide.

What is a "sublease"?

A Sublease Agreement involves a transfer of less than all of the lease . For example, if a person living alone in a leased two bedroom apartment decides to rent out the spare bedroom to a new roommate, that would be a sublease. Or, if a person rents their whole apartment to someone for a couple of months while they travel for the Summer, but then return to the apartment in the Fall, that would also be considered a sublease. The main parties involved in a sublease are:

1. the original tenant , also known as the sublessor , who is the person who first rented the property and plans to rent the space to a new renter, and

2. the subtenant , also known as the sublessee , who is the person who rents their property from the sublessor.

What is an "assignment"?

An Assignment Agreement involves the entire remainder of the lease being transferred to a new tenant. For example, if someone was required to move to a new state for their job and a new tenant takes over the remaining six months on their lease, that would be called an assignment. The main parties involved in an assignment are:

1. the assignor , who is the person who originally rented the property, and

2. the assignee , who is the person renting the property from the assignor and taking over the remainder of their lease.

The first, and most important step, in arranging a sublease or assignment agreement is getting permission from the landlord. The landlord must consent to the arrangement and put this consent in writing using a Consent to Sublease form. If a tenant does not get the consent of the landlord, they leave both themselves and their subtenant or assignee in danger. The landlord would have the option of evicting the tenant, in the case of a sublease, or evicting the assignee, in the case of an assignment, for violation of the original lease agreement. Further, the landlord would feel less obligated to correct defects with the property, such as fixing leaky faucets or broken appliances, given that they do not have a valid agreement with the subtenant or assignee to provide these services.

Unless it says otherwise, when the lease prohibits tenants from subletting or assigning without their landlord's consent, ordinarily the landlord can arbitrarily refuse to permit a sublease or assignment according to their own discretion . However, some states and many leases now provide that the landlord must not unreasonably refuse to give consent to a sublease or assignment. In these instances, if the tenant is able to find a new person who will be at least as good a tenant -- able to pay rent on time, not play the stereo too loud, and follow the other agreements in the lease -- the landlord must accept that person as a subtenant.

If a person's lease prohibits them from assigning the lease without permission from the landlord but does not mention anything about subletting, would that person still be able to sublet the apartment to their friend? Yes, if the lease states only that an assignment is forbidden, the person would still be able to sublet their apartment. Conversely, if the lease prohibits only subletting, the tenant would be able to assign the lease without their landlord's approval. Both actions are prohibited only if the lease says that the tenant cannot sublease the property OR assign the lease without the landlord's consent. Note, however, that some cities, such as New York, have ordinances regulating subleases that take precedence over private agreements.

When subleasing an apartment, the original tenant should try their best to find a person who they think is trustworthy and will continue to pay the rent. The main reason for doing this is that the original tenant remains responsible for making sure the rent gets paid . The subtenant usually does not have to answer to the landlord, only the original tenant; the landlord can generally only sue the original tenant for the rent . If the subtenant does not pay the rent on time, the landlord can start eviction proceedings against the original tenant. If the subtenant owes several months of back rent, the original tenant is responsible for making sure it is paid. In the same way, the original tenant is responsible for making sure the rental is in good shape even if they are not currently living there.

What can a tenant do if they end up paying for the outstanding rent or damage a subtenant did to the property? The tenant can then go to the subtenant to ask that they be reimbursed for this money and take them to small claims court if they refuse to pay.

Unlike in a sublease, in an assignment, if the assignee fails to pay the rent, the landlord can go directly after the assignee for the unpaid rent . The landlord can also sue the assignee for any damage to the apartment that they are responsible for. Be aware, however, that the landlord can still sue the assignor, or original tenant, as well, even if the landlord consented to the assignment. The landlord has their choice of who to go to when they are looking to get paid.

Before subleasing a property or assigning a lease, the original tenant should make sure their subtenant or assignee is a responsible person who will pay the rent on time and will not damage the apartment. In a sublease or assignment, the original tenant essentially steps into the role of landlord to their subtenant or assignee. Therefore, it's important for them to protect themselves the same way a landlord would. When entering into sublease or assignment agreements, the original tenant often puts protective measures in place , including requiring payment of a security deposit, often equal to at least one month's rent, and putting the terms and agreements of the sublease in writing, including details like the length of the sublease or assignment, the amount of rent, when and to whom it must be paid, late charges, payment for damages, and so on.

Since the original tenant is acting as a landlord when subleasing, they are bound by some of the same laws that apply to the landlord . For example, each state has different rules and guidelines about the maximum amount that may be charged for a security deposit. In most cases, the original tenant may not reenter the property without giving appropriate notice to the subtenant. However, particular to assignments, those agreements often include a provision that the original tenant has the right to reenter the property and retake possession of it if the assignee fails to pay the rent. This gives the assignor some additional protection if the assignee defaults on the lease.

Once all parties, including the original tenant, subtenant, and landlord agree to the sublease or assignment, it should be put in writing. A written agreement works to protect all of the parties and their rights and obligations under the lease agreement . An oral agreement is enforceable in some states, but in all cases is subject to potential misunderstandings and challenges in court. A written Lease Assignment Agreement is usually relatively brief since it incorporates all of the provisions included in the original Residential Lease Agreement or Commercial Lease Agreement . A Sublease Agreement is more extensive and includes specifics related to when and to whom rent payments will be made, whether the subtenant will pay a security deposit to the original tenant and if so the method and amount of that payment, who will receive notices related to the rental. Once a Sublease Agreement or Lease Assignment Agreement has been put into writing, it should be signed by all involved parties. The Agreement must always be signed by the tenant and subtenant or assignee. However, the document may also be signed by the landlord to serve as a written record that the landlord grants their permission and is aware of the arrangement.

What if a tenant must move out of their rental property for some reason, say, six months before the lease expires, but they don't want to worry about the potential hassle and risk of finding a subtenant or assignee? The lease may give the tenant the right to cancel their lease by giving a certain amount of notice, usually two to three months. In a month-to-month lease, the tenant usually must give only thirty days notice. If the lease does not allow for this, the tenant has the option of finding a new tenant, subject to their landlord's approval, and the tenant's own trouble and expense. When the tenant finds a suitable person, they can ask their landlord to sign a document releasing them from their original lease . The landlord will then have the new tenant pay a deposit and sign a new lease. If the landlord agrees to do this, the original tenant will no longer be liable for the rent or acts of the new tenant. This solution is often acceptable to reasonable landlords.

Subleasing can be a great option for someone looking to move somewhere else, either temporarily or permanently, while they are in the middle of their current lease term. Here are the most important things to remember when setting up a sublease or assignment agreement:

  • A sublease is a transfer of less than all of the lease; an assignment is a transfer of the entire remainder of the lease.
  • The landlord must grant their permission for the sublease or assignment in writing if the tenant wants to protect themselves from future liability.
  • In a sublease, the landlord can only go after the original tenant for rent or damages owed by the subtenant; in an assignment, the landlord can go after either the original tenant or the assignee.
  • The original tenant can use measures such as collecting a security deposit to protect themselves in case the subtenant or asignee fails to pay the rent or causes damages.
  • The best way to protect all involved parties is to put the agreement in writing.

About the Author: Malissa Durham is a Legal Templates Programmer and Attorney at Wonder .Legal and is based in the U.S.A.

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Charge tenants a fee for processing their assignment & sublease requests, if tenants don’t have to pay fees, they’re more apt to flood you with requests..

In these uncertain times, tenants are increasingly reluctant to lock themselves into long-term leases. Assignment and sublease rights may alleviate these concerns and give tenants added flexibility. However, they can also be a burden for landlords. For one thing, processing assignment and sublease requests takes significant time and administrative effort. It seems only reasonable that landlords should seek to pass along at least some of their processing costs to tenants.

That’s why you should include a lease clause that requires tenants to pay a non-refundable fee for each assignment or sublease they request. While the amount of the fee is subject to negotiation, it should be high enough to both cover your administrative and legal expenses and discourage tenants from making frivolous or superfluous requests that they know you won’t approve. We’ll give you a Model Lease Clause: Require Non-Refundable Fee to Process Assignment or Sublease Requests, that you can adapt and use in your leases.

Fee Compensates Landlord’s Actual Costs

During lease negotiations, tenants may object to these fees. Remind them of the extensive materials you must review when deciding whether to give consent to an assignment or sublease request. You need to evaluate the proposed assignee/sublessee’s financial records, credit history, business model, and reputation. Then you have to consider all of the different improvements the new tenant will need, which may involve detailed consultations with architects, electricians, plumbers, and other contractors and vendors. If the candidate is still viable at this point, you’ll have to talk to your attorney and review the assignment and sublease documents to identify what in the current lease you need to change to ensure proper legal protection. Then you have to negotiate and finalize those lease changes with all the parties involved.

There’s really no way to avoid these costs and hassles. Commercial leases typically give landlords the right not to consent to assignments or subleases but also spell out that such consent must not be unreasonably withheld. Carrying out due diligence is part of what landlords must do to demonstrate that they acted reasonably in denying consent. It’s basically a landlord’s cost of doing business.

Processing Fee Motivates Tenants to Pre-Screen

The non-refundable fee not only compensates you for your expenses but also incentivizes the tenant to pre-screen its prospective assignees or sublessee’s before presenting them to you. Tenants won’t want to lay out the fee if they know the prospect has little chance of winning the landlord’s acceptance. The fee thus spreads the risks and gives tenants a financial interest in the outcome of the vetting process.

By contrast, if tenants don’t have to pay fees, they’re more apt to flood you with assignment and sublease requests. Some ill-faithed tenants might even exploit this advantage as a harassment tactic, submitting dozens of requests in the hope that you’ll eventually feel like you have to accept one of the proposed assignees or sublessees just to put the stream of requests to an end.

How to Draft Non-Refundable Processing Fee Clause

Having established justification for charging the fee, you need to ensure you incorporate the appropriate language into your lease. Like our Model Lease Clause, your clause should make it clear that the fee is:

  • Compensation for your administrative, legal, and other costs in processing assignment and sublease requests;
  • Non-refundable, meaning the tenant must pay it regardless of the ultimate decision you make on the request;
  • Payable for each assignment or sublease request the tenant makes and that you need not process the request if the tenant doesn’t make the accompanying payment [Clause, par. a].

Potential Compromises

If a tenant with significant negotiating leverage flatly refuses to accept the fees clause, you don’t have to ditch the idea completely. Compromises you can propose include:

Reduced fee: First, explore the possibility of reducing the fee amount. The key is to hold the line on a certain amount that you determine is the minimum necessary to fairly cover your costs and disincentivize frivolous requests from the tenant.

Partial refund: An alternative approach is to maintain the fee amount but agree to make a stated portion of the fee—such as 25 percent—refundable if you end up giving your consent to the particular assignment or sublease request. However, specify that you will pay the refund only after the effective date of the assignment or sublease, provided that the assignee or sublessee actually opens for business [Clause, par. c]. Better yet, postpone payment of the refund until after the assignee or sublessee pays three full months of rent. By that time, you should be satisfied that the assignee or sublessee is desirable and responsible.

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Lease Tips: Assignments, Sublets, and Everything In Between

by TVS | Aug 15, 2016 | Rental Forms

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Built into nearly every tenancy agreement is a paragraph that deals with assignments and sublets. It’s important for landlords to understand the impact of these provisions when handling tenant issues.

Landlord Responsibilities: Assignments, Sublets, Early Terminations

If a tenant needs to leave the rental property early or temporarily, there are any number of possible outcomes. A landlord may:

Have a waiting list of available tenants. In that case, the landlord could allow an early termination, and enter into a new lease with a new tenant.

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Allow the tenant to sublet the property. A sublet is a specific arrangement where the original tenant brings in a surrogate who will live in the property and pay the rent, typically to the tenant. The tenant will in turn continue to pay the landlord, and remains liable for other provisions in the lease. Common examples where a tenant may want to sublet are long-term rentals were the tenant plans to return, and replacing an exiting roommate.

As a general rule, the landlord has the right to approve the subtenant. It’s important to include that language in the tenancy agreement. The best way to vet the new subtenant is to ask for a rental application and run a tenant background check .

Assuming all goes well with the sublet, the landlord may not be affected. The subtenant has few legal rights. In fact, the British Columbia Residential Tenancy Branch just updated its guidelines to clarify that subtenants do not have standing to ask for dispute resolution with the RTB. Their only recourse is through the original tenant.

However, as a practical matter, the landlord may suffer from a sublet, especially where there is a disgruntled subtenant, or a policy of revolving roommates. It’s imperative to know who is living in the rental property, and whether there are any safety or health concerns. For that reason, it may be cleaner for the landlord to simply terminate the original lease, and enter into a new lease agreement with the proposed subtenant. That allows the landlord more control over what is happening at the property.

A increasingly popular option for today’s tenants in overnight sublets through vacation rental websites. These sublets may be restricted by local law, or may violate other provisions in the lease concerning residential use of the property. There is also an obvious risk due to the lack of tenant screening . There have been a number of reports of subtenants using false identities, stealing the tenant’s identity, or causing significant property damage before leaving the country. Where the subtenant has access to common areas or creates disturbances, neighbouring tenants may complain or even threaten to break their leases.

In Quebec, the Régie du logement has ruled that tenants must seek their landlord’s approval before advertising for vacation sublets. However, the landlord can’t use their tenant’s newfound profits to raise rent. At the same time, the tenant is not allowed to overcharge subtenants for nightly visits.

Allow the tenant to assign the tenancy agreement. Where a sublet is often a short-term arrangement, assignment generally is more permanent. All of the tenant rights and responsibilities are transferred to another person. This usually includes the responsibility to pay rent directly to the landlord in whatever fashion is stated in the lease. As with a sublet, in an assignment, the original tenant is still a responsible party to the lease.

The advantage of an assignment is having what is loosely equivalent to a lease guarantee, where the landlord deals directly with the new tenant, but still could pursue the old tenant in the event of default.

However, the disadvantage of the assignment is that the original tenant is the one who goes over the rules and responsibilities with the new tenant. The landlord may become separated from the process.

It may not be possible — or practical — to prohibit sublets, assignments  or early terminations altogether. There is a duty on the part of a landlord to mitigate damages if a tenant leaves early. The landlord must take reasonable action to find a replacement tenant as soon as possible, regardless of the stated term in the lease or the reason that the tenant is leaving. The exiting tenant likely will be liable only for the time the property is not rented.

In addition to the duty to mitigate damages and find a replacement tenant, if the landlord denies an early termination request, a panicked tenant might abandon the property. In that case, it may not be clear whether the original lease has been terminated, and recovering the property may require more time and possibly a court order.

A landlord gains no advantage by refusing a request for early termination, or failing to approve a replacement tenant.The best strategy in the situation may be to stay in control of the tenant screening process and to have legal rights over the person who is occupying the rental property.

If you are unclear about issues concerning your tenancy agreement or how to handle tenant issues, consult with your legal counsel.

This post is provided by Tenant Verification Service, Inc. , helping landlords reduce the risks of renting with fraud prevention tools that include Tenant Screening , Tenant Background Checks , (U.S. and Canada), as well as Criminal Background Checks , and Eviction Reports (U.S. only).

Click Here to Receive Landlord Credit Reports .

Disclaimer: The information provided in this post in not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.

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Texas Subletting Laws

Texas Subletting Laws

Last Updated: November 2, 2023 by Phil Ahn

Texas state law   does not   grant tenants, by default, the right to sublease [1] . Instead, they must have explicit, written consent from the landlord to do so. If such consent was not included in the lease, the landlord reserves the right to deny future requests.

Does a Tenant Need the Landlord’s Permission to Sublet in Texas?

Because state law does not inherently give tenants the right to sublet, a tenant   does   have to get the landlord’s explicit written consent to do so. This consent could be given in the original lease agreement or through a   separately signed agreement .

Even if permission to sublet is granted, a landlord is allowed to screen potential subtenants and deny them for legally acceptable reasons .

Tenants interested in subletting should start by reviewing their lease agreement to see what language it includes about subleasing. The four most common scenarios of sublease language in a lease agreement are:

  • A clause strictly prohibiting subletting.
  • A clause requiring a landlord’s written permission to sublease.
  • A clause allowing a tenant to sublease (without additional permission).
  • No language or clause whatsoever about the permission to sublease.

1. Lease Clause Strictly Prohibiting Subletting

“The Landlord and Tenant agree that the Tenant shall   not   have the express and unqualified rights to sublease the rental premise.”

A signed lease may already explicitly state that the tenant is not allowed to sublease. In this situation, a tenant’s only option is to ask the landlord to make an amendment to the lease.

2. Lease Clause Requiring Landlord’s Permission

“Tenant shall not assign or sublet any part of the leased premises without prior written consent of Landlord.”

In this situation, a tenant could be allowed to sublet, but must receive additional written consent from the landlord prior to doing so. However, if asked, the landlord is not required to grant such permission.

3. Lease Clause Allowing Tenant to Sublease Without Additional Permission

“The Landlord and Tenant agree that the Tenant shall have the express and unqualified rights to sublease the rental premise.”

In this situation, the tenant can immediately begin subleasing the property without needing to get the landlord’s permission. It may also mean the tenant does not even have to inform the landlord of their intent to do so, depending on if this clause doesn’t explicitly require this.

4. Entire Lease Containing No Mention of Subleasing

If a lease is silent about subleasing, it’s illegal for a tenant to sublease without first getting the landlord’s written permission to do so. If asked, the landlord is not required to grant such permission.

Can a Landlord Prohibit a Tenant from Subletting in Texas?

Unless prior written consent has already been granted, a landlord   can   prohibit a tenant from subletting in Texas. A landlord reserves the right to deny any and all future requests from a tenant to sublease.

Usually, denials will occur if the prospective sublessee would be unable to meet the financial obligations of renting out the premises. Another situation where denial could occur is if there is reason for the landlord to believe the future sublessee is not reputable, and is of bad character that could potentially put the landlord in a worse position.

However, if prior consent was already explicitly granted in writing, such as in the lease agreement, a landlord cannot prohibit subletting under those previously agreed terms. The landlord’s only option would be to amend the lease or sign a new agreement to forbid subletting, which requires the agreement of both parties.

What Rights Do Subletting Tenants Have in Texas?

A tenant who subleases (“subtenant”) has   the same rights and responsibilities as the original tenant . This means the subtenant is treated the same as any other tenant under Texas law when it comes to rights such as privacy, health and safety standards of a rental unit and due process for an eviction.

However, if certain rights are violated, subtenants in Texas cannot sue the original tenant’s landlord. Instead, a subtenant must sue the original tenant for the issue. The original tenant can then in turn sue the landlord if the issue is caused by the landlord (and isn’t remedied in a timely manner after proper notification). 

If the subtenant causes any damage, the most likely outcome is the landlord will subtract the cost of those damages from the original tenant’s security deposit. The original tenant would have to bring a claim against the subtenant to recover money lost from the security deposit. 

Subtenant Rights in Illegal Sublets

Subtenants in illegal sublets   do not   automatically have the legal right to break the terms of their sublease. Even if the landlord did not consent to the sublease, the contract may still be considered valid between the subtenant and the tenant.

Generally, any sort of legal action against an illegal subtenant will take the form of an eviction. Unless the lease states otherwise, landlords will give notice that the illegal subtenant has   3 days   to vacate the premises. For those illegal subtenants that still do not leave, the next step would be for the landlord to take them to small claims court. The filing fee ranges from $25-$250, depending on the county in which the landlord resides.

What are the Consequences for Illegally Subletting in Texas?

If a tenant subleases their unit without the landlord’s explicit written permission, the tenant is in breach of their lease. In Texas, a lease violation permits a landlord   to evict the tenant and subtenant   (starting with a   3 Day Notice to Vacate ) and   to sue the original tenant   for any resulting damages.

In addition to the landlord, the subtenant   also   may have grounds to take legal action if the original tenant sublet the unit illegally.

Evictions for Illegal Subletting in Texas

Landlords in Texas are   not   required to provide the tenant a chance to fix a lease violation, such as illegally subletting, and remain at the property if corrected. However, a landlord   can   provide that opportunity if they want to. In that case, they can instead serve the tenant a 3 Day Notice to Comply or Vacate .

Both eviction notice types give the original tenant   3 calendar days   to take action (move out or fix the issue). Once the notice expires, if the tenant has not taken the required action, the landlord may then proceed with the second step of the eviction process, which entails filing a petition with the county court. This next step in the eviction process usually takes about   1 to 2 months.

During the terms of a lease, the tenant may not rent the leasehold to any other person without the prior consent of the landlord.

Subletting Laws in Other States

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Assignment vs Subletting - What is the difference?

Assignment vs subletting – what are the differences.

assignment subletting and replacement tenant fees

Assigning a residential lease agreement and subletting are two distinct ways of transferring tenancy rights in a rental property, each involving different legal and practical implications. Here’s a breakdown of their differences:

Assignment of a Residential Lease Agreement:

Definition:

Transfer of Responsibility: Assigning a lease involves transfer of the original tenant’s entire interest in the lease to a new tenant. The original tenant ceases to have any rights or obligations related to the property.

Consent from Landlord: Typically requires the landlord's explicit permission or consent. The landlord is often involved in vetting and approving the new tenant.

Replacement Tenant: The original tenant may find a replacement (assignee) who takes over the lease entirely. The landlord may also market for a new tenant and vet any potential replacement tenants.

Legal Responsibility:

Liability: The assignor (original tenant) is usually released from all liabilities and obligations once the lease is assigned to the new tenant.  This may key off of the new tenant taking possession of the rental unit.

Direct Relationship with Landlord: The new tenant (assignee) becomes directly responsible to the landlord for rent payments, property maintenance, and adherence to lease terms by effectively “stepping into the shoes” of the departing tenant.

Implications:

End of Original Tenancy: For the assignor, once the lease is assigned, their association with the property generally ends. They may not have recourse if the assignee defaults on payments or breaches the lease.

Subletting of a Residential Lease Agreement:

Partial Transfer: Subletting occurs when the original tenant rents out all or part of the property to a subtenant while retaining some rights and responsibilities under the original lease.

Consent from Landlord: Usually requires the landlord's permission, as outlined in the lease agreement. Some leases explicitly prohibit subletting.

Ongoing Relationship with Landlord: The original tenant (sublessor) maintains responsibility to the landlord for lease obligations.

Obligations: The sublessor remains responsible for rent payments and adherence to lease terms, acting as an intermediary between the landlord and subtenant.

Relationship with Subtenant: The sublessee has a legal relationship with the sublessor rather than the landlord. The sublessee must adhere to terms agreed upon in the sublease.

Ongoing Responsibility: The original tenant (sublessor) remains liable to the landlord for the property and its condition. They're responsible for any damages or lease violations caused by the sublessee.

Continued Tenancy: The original tenant maintains an ongoing relationship with the property and the landlord.

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Key Differences: 

  • Transfer of Responsibility:  Assigning a lease completely transfers the tenant's interest to a new tenant, while subletting involves the original tenant retaining some rights and responsibilities.
  • Direct Relationship : In assignment, the new tenant has a direct relationship with the landlord, whereas in subletting, the original tenant maintains this relationship. 
  • Liability and Obligations:  Assigning a lease typically releases the original tenant from obligations, while subletting keeps them responsible for the property.

Both assignment and subletting can offer flexibility to tenants but come with distinct legal and practical implications that tenants and landlords should carefully consider before proceeding. Understanding these differences helps individuals choose the appropriate option based on their circumstances and lease agreement terms.

In most cases, assignment is the best course as it avoids the main pitfall of subletting, namely that the subletting tenant has no direct relationship or responsibility to the landlord/owner of the rental unit.  For that reason, professional property managers normally recommend termination of the original lease and negotiation of a new lease with the replacement tenant.  The outgoing tenant will normally absorb some of the costs associated with securing a replacement and the property manager makes sure the turnover is handled property.  Having experience when these issues arise is important to protect the landlord’s interests.  If you need management of an investment property, call one of our managers today to learn why so many landlords believe TREG is the RIGHT CHOICE for property management.

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Subletting And Sub-Lease Agreements In The USA

In this article, we outline best practices and potential pitfalls of subletting. It may not be legal to prevent it outright.

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What is Subletting?

  • Your subletting approach
  • Managing and screening subtenants
  • Subletting laws

What if you don’t want to allow subletting?

  • Subletting Fees

Final Words

A landlord’s top priority is to avoid vacancies. This can at times be a challenge, circumstances change, and no matter how great the property is – unexpected situations can arise which could lead to unexpected and costly vacancies.

Often, when circumstances change for a tenant the tenant will approach their landlord and ask about the potential to sublease.

Subletting is often a good solution for both tenants and landlords. It allows tenants greater flexibility around their living arrangements, as well as helping landlords avoid losing money from unexpected vacancies. However, subletting is not without its risks, and as a landlord, you need to be aware of these increased risks and what can be done to mitigate them.

In this article, we take a deep dive into subletting and how to best handle it as a landlord.

Subletting is when your tenant finds someone – for a period of time – to cover the terms of their lease.

There are several reasons why a tenant might want to sublet. Often it’s because they are going away for an extended period and want someone to cover the rent whilst they are out of town. Alternatively, they might be moving out of the area due to job change or relocation and don’t want to break the terms of the lease.

Working with your tenants to come to a solution that works for everyone is likely the best way forward.

Your subletting approach (a clause in your lease)

First of all, it’s worth pointing out that you can only outright ban subletting in your lease agreement in some states. Others require you to legally allow it unless you can give good reason to deny your tenant the option to sublet. See the laws by state further down the article.

On top of this, if you are allowed to ban subletting and choose to write that into your lease, there is a chance your tenants will sublet anyway, but without your knowledge. This can lead to several problems depending on the scenario.

As a rule of thumb, you want to be involved in who is staying in your property. So, whatever your decision is around subletting, make sure there is a legally binding clause in your lease.

If you don’t allow it, make sure you do regular property inspections. If you do allow it then make sure the sublessee has to apply and is subject to your normal screening process and subsequent approval.

Tenants must have written permission to sub-let

Including this requirement in the sublet clause of your lease agreement will ensure tenants ask for your express permission before beginning the sublet process.

The more you formalize this, the more you’ll communicate to your tenants how seriously you take the leasing process, and they’ll take the same care in subletting.

Draft sub-lease clause for a residential lease agreement

ASSIGNMENT AND SUBLEASING. Tenant(s) shall not assign this Agreement, or sublet or grant any license to use the Premises or any part thereof without the prior written consent of Landlord. Consent by Landlord to one such assignment, subletting or license shall not be deemed to be consent to any subsequent assignment, subletting, or license. An assignment, subletting, or license without the prior written consent of Landlord or an assignment or subletting by operation of law shall be absolutely null and void and shall, at Landlord’s option, terminate this Agreement and start the eviction process of all Tenant(s) and occupants.

All subletting individuals are required to apply to the Landlord for evaluation and screening. The landlord reserves the right to reject any sublessee that does not qualify.

Managing and Screening Subtenants

Who’s responsible for a sub-tenant.

Whilst your property is sublet your original tenant is responsible for any damages to your property or late rent.

You can’t evict a subtenant. If you receive no rent your only recourse is to file for eviction against your original tenant. This can be especially problematic if they are out of state.

It’s a good idea then for your tenant to create a legally binding sublease agreement with their subtenant as well as collect a deposit from them to offset any potential expenses they will have to pay from their own deposit should the subtenant cause damage to the property.

Screening Sub-tenants

Just like when you choose your tenant you will want to properly screen any potential subtenants . Tenant screening is a crucial task for a landlord because it is the only way you can minimize the risks of getting stuck with nightmare tenants.

When you talk to your tenants about subletting make sure they understand that whilst they will be responsible for finding their replacement tenants – you as the landlord will have the final say as to whether or not those tenants are suitable. To make it easier it could be worth your while outlining what you look for in a suitable tenant so they can better select prospective sub-tenants.

Read our detailed guide for finding and keeping the best tenants.

Dealing with rent when sub-letting

When collecting rent from a sublet property you can either choose to collect rent directly from the occupying subtenant or continue to collect rent from your original tenant and the subtenant pays them.

Personally, we prefer the second option for the following reasons. When your property is being sublet your current tenant is still responsible for ensuring that rent is paid on time. The only action you as a landlord can take if the sub-tenant is late to pay rent that is to file for eviction against your current tenant.

To avoid arguments with your tenant about late rent, potential fees, or who is responsible , have them continue to pay the rent and they can take on the responsibility of chasing up payments from their subtenant.

If a subtenant starts paying the landlord rather than the tenant, they will have a strong argument that they are the landlord’s tenant. To prevent your subtenant from gaining the rights of a co-tenant, you should make sure that they pay rent to your tenant, and then they send it on to you the landlord.

Read : The Best Ways to Collect rent from your Tenants

Using Landlord Studio to Manage Sub-tenants

Communications.

Your tenant remains responsible for the sub-tenant. However, depending on the situation it might be more practical to also engage in direct communication with the sub-tenant.

You can use Landlord Studio to keep your subtenants organized and better manage communications with them.

  • Collect the sub-tenants name contact details and enter them into the system.
  • Connect the tenant’s details to your property which will allow you to copy them into any communications that go to your original tenant.
  • Use SMS and Email templates when messaging your subtenants and tenants to save yourself time.

As a landlord, you are legally required to give notice for things like property inspections. As the sub-tenant is essentially the tenant of your tenant and not legally connected with you directly the issue of notifying the sub-tenant gets a little confusing.

It is best to err on the side of caution and email both your tenant and the subtenant notice in advance – abiding by your local state law – if you need to gain access to the property.

If the rent is late, you will want to chase up your tenant for payment, not the subtenant. If rent is continually late or unpaid you will want to think about filing for eviction because your tenant has broken with the lease agreement.

To help avoid late rent set up automated reminders for upcoming and overdue rent.

Maintenance Requests

Whilst you’re not responsible for the sub-tenant this does not remove your legal responsibility as a landlord to provide a safe living environment. Having maintenance requests go through your tenant can cause issues and delays, especially if they aren’t living in the property at the same time. Make sure that the subtenant has emergency contact details in case of maintenance emergencies.

Your tenant remains responsible for all damages to the property – even those caused by the sub-tenant. This is why tenants should collect a deposit from the subtenant to offset any damage costs caused by the sub-tenant that will be taken out of their own deposit at the end of the tenancy.

“Track income and expenses, screen tenants, set automatic reminders, and more with Landlord Studio.”

Subletting Laws

Are landlords legally required to allow subletting.

In some states, landlords are legally required to allow subletting unless there is a good reason to deny a tenant’s request to sublet.

On top of this, it is invariably harder to resolve issues surrounding subletting if there is no legally binding clause in the lease.

Whatever you decide is going to be your policy, make sure it abides by local state law, and is clearly and legally stipulated in your lease agreement.

Laws by State – Permission to Sublet

State specific subletting laws, states with no specific subletting laws.

As mentioned above many states require you to allow sub-letting. However, there are a couple of routes available if you don’t want to allow subletting in your property.

The reason subletting comes up is usually a change in circumstances for the tenant. Subletting is an opportunity to keep the rent payments coming in.

Another way to accomplish this goal without subletting is to give the tenant a chance to break their lease agreement.

If a tenant approaches you about subletting, you could encourage them to “buy out” of their lease with an early termination option. For example, you might require 60 days’ notice and a fee equal to 1-2 months of rent.

This will give you plenty of time to find a new tenant as well as cover costs from any vacancy period and costs associated with finding the new tenant.

Sublet Fees

Sometimes, when a landlord learns that a tenant wishes to sublet, the landlord will inform the tenant that they need to pay a fee to have the option to sublet. This fee is not always fully legal.

To be clear, sometimes a landlord does have costs associated with screening a new tenant (background checks, criminal history checks), and the landlord can pass these costs onto the tenant. However, a landlord cannot:

  • Charge a fee beyond the actual damages.
  • Charge for their time. There are specific circumstances in which a landlord can charge for their time, but this is not one of them.

Check with your specific state laws to determine what is legal and what is not when it comes to subletting fees as laws vary widely from state to state.

When subletting finances must be dealt with properly. The original tenants should collect a deposit from their sublessee. There are strict laws in most states determining the amount of deposit that can be collected as well as the returning of the deposit.

For example, in California, the tenant has 21 days to return a deposit after the subtenant moves out. The security deposit can be used to cover the cost of damage repairs, unpaid rent, and the cost of cleaning the unit. It cannot be used for minor damage that’s due to normal wear and tear.

If the tenant chooses to deduct fees for damage to the apartment, they must provide the subtenant with an itemized list of the deductions and copies of the receipts used for repairs.

Make sure the original tenant and subtenant go through a proper handover procedure where they document damages and make careful notes on the condition of the property when the subtenant moves in to help avoid disputes around deposits at the end of the lease term.

A final note is to ensure that you have contact details for the original tenant as well as their new address (if they are moving out of town) as they are still the ones legally bound to your current lease not the subtenant and not being able to get in contact with them could prove incredibly problematic!

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We hope you found this article interesting! However, do note that the purposes of this article are for general information. We are not licensed financial or legal professionals and as such nothing in this article should be understood to be financial or legal advice. If you require financial or legal assistance please seek the help of a competent professional.

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Assignment and Subletting Clauses in Commercial Leases

Commercial leases: assignment and subletting

  • by Coy Davidson | September 6, 2009

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Transferring Leasehold Rights to Another Party

Occasionally, a tenant needs to prematurely vacate their leased premises or transfer their rights to another party. When negotiating your lease, it may not seem to be a clause of primary importance. However, we don’t always foresee challenging economic times, and the amount of sublease space currently on the market only proves why it is critical to pay special attention to these rights spelled out in the lease document and to maintain as much flexibility as possible to mitigate your lease obligation should business conditions dictate. There are several reasons why the original tenant may need to do so, and he or she should have some right, not unreasonably withheld, to bring in a new, replacement tenant or a new owner of the business and “assign” the lease or “sublet” the lease space to a new business entity.

Assignment and subletting are not the same. In an assignment, the original tenant assigns, or grants, his rights and obligations under the lease entirely to the new tenant, who agrees to accept them. The new tenant literally substitutes in for the original tenant, who is no longer bound under the lease.

A sublet situation is one where a new tenant occupies the lease space, but the original tenant remains liable for the lease obligations. Subletting is much less risky for a landlord because two tenants are liable under the same lease: the original tenant and the subletting tenant.

There are several major issues in any sublet or assignment situation:

  • The parties
  • The terms desired by each party
  • The original tenant’s obligations
  • What is each party agreeable to in the event of name changes, mergers, etc.?
  • The handling of sublease rental amounts in excess of the scheduled rental amounts
  • The handling of deposits, tenant liens, etc.
  • Payment of any costs to the landlord when considering a replacement tenant.

Not surprisingly, landlords are traditionally much more reluctant to agree to an assignment because it is inherently riskier for the landlord. The main risk is whether the new tenant is financially able to assume the lease obligations of the original tenant. No landlord will willingly accept a replacement tenant who is weaker financially and thus unable to fulfill the lease requirements. Unless it can be shown that the new tenant is at least as strong financially as the original tenant, the landlord may be reasonable to deny the requested assignment. Additionally, the landlord must determine that the new tenant is desirable, which is subjective to a point. The landlord will be concerned that the new tenant is credit-worthy, strong financially, has a good reputation, and fits well into the existing tenant mix.

The lease must define the tenant’s rights regarding assigning the lease or subletting the space to another tenant. To be balanced, this language should also include the landlord’s rights to accept or deny an assignment or sublease agreement, with the allowable basis for his acceptance or denial being clearly defined. Both the tenant and the landlord must be careful when negotiating these types of clauses.

Regardless of how desirable and/or financially sound the new tenant is, the landlord may insist that the original tenant remain responsible for his or her original obligations under the lease.

Additionally, the landlord may impose other conditions, such as:

  • The landlord must agree to the proposed use of the lease space by the new tenant
  • The replacement tenant will have to execute acceptable documents with the landlord wherein it adopts the original lease and agrees to meet all the obligations therein of the original tenant
  • The original tenant must pay the landlord’s expenses and other reasonable costs (legal fees, financial analysis assistance) that may be incurred when considering any replacement tenant, whether that replacement tenant is ultimately approved. (Some landlords set a basic fee of $1,000 to $5,000 to cover the due diligence work necessary to evaluate the replacement tenant.)

Instead of these details being outlined in the lease, many tenants seek to simply have the lease provide that “the landlord shall not unreasonably withhold the right of the tenant to sublease or assign his/her interests in this lease.” Landlords are generally more agreeable to the use of this phrase when the potential assignee is an affiliate, parent organization, franchisor, subsidiary or successor corporation, purchaser, or merging company of the original tenant rather than an unrelated third party. From the tenant’s perspective, it is important to create as much flexibility as possible, for it can have a significant impact on the marketability of your sublease space.

Commercial lease agreements are complex legal documents. A business is best served when represented by an experienced tenant representative and a real estate attorney .

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What’s the difference between a sublet and an assignment?

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With both a sublet and a lease assignment, the departing tenant remains responsible for the rent unless a landlord explicitly releases you. 

When Ismail Mustafa, a tenant in Dumbo, wanted to break his lease recently, the landlord gave him three options: He could arrange a sublet, transfer the lease to someone else, or end the lease by paying two months of rent upfront.

There’s obviously a financial cost to paying two months rent as a penalty for breaking your lease but it is also the most clear-cut break with your landlord. If you're considering the same options as Mustafa, it's important to know the difference between transferring your lease to someone else (also known as an assignment) and subletting. Neither are without risk.

"The bottom line is—none of the options is perfect—each has advantages and disadvantages," says  attorney Steven Kirkpatrick, a partner at the law firm  Romer Debbas.

It's worth pointing out that a fourth option might be  offered to you: To move out and pay rent until the landlord finds a tenant. This is highly "problematic," says  Catherine Grad, a tenant attorney with her own practice.  "You no longer have control over the process and you are still on the hook for the rent and you’ve given the power to someone who’s incentive is less than yours." 

Subletting vs. assignment

When you sublet your place it's typically because you intend to return to the apartment. A sublet will usually end a week—but it could be just a day—before the actual end of your original lease.

Subletting for the entire length of the lease is an assignment. An assignment allows you to hand off the rental to a new tenant for the rest of the lease term. This is what Mustafa ended up doing.  What's important is that either way—with both a sublet and an assignment—you are giving up your rights to the rental  but in both scenarios you are often still liable if there is damage to the apartment or the next tenant fails to pay. The risks are "tremendous," Grad says. 

When you assign a lease, the person you are assigning to would pay the landlord directly and deal with the landlord for repairs. 

If you are subletting you stand in the shoes of the landlord. The subtenant pays you the rent and you then pay the landlord. "If there are problems in the apartment, it is your duty to get it fixed," Grad says. This is the case, even if you are not authorized to make the repairs.  So while a sublet and an assignment are technically different, in terms of the risk for the departing tenant, Grad  says,  "it is the same." 

"The fact that you assign your rights does not eliminate your obligation to pay," Kirkpatrick  says.

The only situation in which you wouldn't be responsible for the apartment in any way is if you were released by the landlord from your original lease in writing. In practical terms, Grad says, "y ou will never get that with a sublease but might get it for an assignment. The landlord has no incentive to give that to you. Why not have two people on the hook—both you and assignee?" she asks.

A payment or additional security might be the incentive a landlord needs to release you. Security deposits are capped at one months rent making this type of payment "problematic," says Kirkpatrick but he adds there might be ways to structure it as a quid pro quo to release you of liability.  

Negotiations around lease breaks

A landlord cannot unreasonably deny your request to sublet or assign a lease in a residential situation.  If your landlord isn’t responding to your request to assign the lease, that silence becomes default consent within 30 days of you alerting them or of them receiving any additional information about the arrangement. If a landlord's refusal to assign is unreasonable, that terminates your lease.

If the refusal is unreasonable for a sublet, you aren't released from the lease but you are able to sublet the apartment and can fight it out in court. 

Grad says seeking to sublet or to assign your lease often leads to discussions about lease termination. Landlords know they cannot unreasonably deny your request but they also entered an agreement with you and want you to pay up. Yes, the  landlord has a duty to mitigate—which means they must do all they can to find a replacement tenant if you want to break your lease—but as Grad points out, this benefit isn't a given. 

"You have to fight for it—that's the nature of legal rights. It  doesn’t mean you have a right to break your lease, it just gives you a defense when you get sued for all the rent," she says. 

Insurance considerations

Without release from your own lease you will want to set up a separate agreement with the incoming tenant. Kirkpatrick advises having an indemnification agreement although points out that for practical purposes if the person stops paying the rent, there are no guarantees they will still be able to pay you. "If it were me, I’d want a guarantor," Kirkpatrick says. 

To protect yourself, run a credit report on a prospective subtenant or assignee. Phil Horigan, founder of  Leasebreak,  a website where you can find renters to take over an unwanted lease tells Brick, "in most cases I have heard where a tenant has gotten burned by a sublet, the tenant did not run credit."

You also need to make sure the subtenant or assignee has apartment insurance and that you too have apartment insurance, Grad says. If your landlord has not released you from the lease you remain liable if the tenant, for example, floods the apartment below or there's a fire in the place. 

You also want your tenant to know you are not covering their contents or liability. Jeffrey Schneider, president of Gotham Brokerage (a Brick Underground sponsor) says, "there are various ways to cover this, depending on whether you are an owner or former tenant."

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Emily Myers

Emily Myers is a senior writer, podcast host, and producer at Brick Underground. She writes about issues ranging from market analysis and tenants' rights to the intricacies of buying and selling condos and co-ops. As host of the Brick Underground podcast,  she has earned four silver awards from the National Association of Real Estate Editors.

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Arizona Commercial Real Estate | ICRE

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Subletting and Assignment of Lease: What is the Difference?

Subletting and Assignment of Lease

Have you considered subletting your space? There are several ways to get rid of some or all of your space you lease that you don’t need. You can have language is your lease that simply ask to give up some space. You may elect to turn part of the space back to the landlord if your lease has a clause in enabling you to contract your space or you may have the option to terminate the lease. Today I want to talk about your option to sublet and/or assign your lease. I’ll explain the difference between Subletting and Assigning your lease you’ll what to know the difference and what rights under your lease you have to exercise either option. For lease negotiation purposes, there is usually little difference between subletting and assigning. For that reason, we often lump the two methods together and refer to them as “transfers”.

The difference between subletting and assigning

Subletting: If you transfer just part of your leased space to another tenant, on a temporary or permanent basis, its called a sublease, often times the sublease rate negotiated is below market rents with flexible terms in order to entice someone to sublet your space as apposed to going direct. The person who subleases is called a sub tenant. In a subleasing arrangement the sub tenant pays rent to you, the tenant and the tenant pays rent to the landlord under the same terms and conditions of your lease. If there is a sublease clause in your lease most often the Landlord will have to approve the sublessee and run a credit check just like they would with a normal tenant, the approval of which often is timely. You as the Tenant are ultimately responsible for the performance of your lease.

Assignment: By contrast, an assignment occurs when you transfer all your space to someone else (called an assignee) for the entire remaining term of your lease. (You can instead terminate the lease), which is often preferable if you want to move on and never come back, you’ll look for someone to completely take over the lease-assignment. In an assignment, the new tenant pays rent directly to the landlord Importantly, since you’ve given away all of your interest in the lease, you have no rights to retake the property or to evict the assignee for nonpayment of rent. You have to be careful not to assume that because you sublet your space or assigned the entire lease to another tenant, you’re relived of some or all of your obligations. Often, you’re still responsible for paying the rent if they subtenant or assignee fails to pay and making good on other lease obligations unless the Landlord releases you of financial obligations of the lease. Most landlords prefer that the Tenant buy-out their lease and go direct with a new Tenant rather than doing a sublease or assignment arrangement for a couple reasons

1) Extend the lease beyond the initial maturity date

2) Market conditions most likely changed since the initial lease was signed, the market rents most likely have increased since the original tenant took occupancy.

Here is an example of Subletting/Assignment clause, please note, this language is not a substitute for personalized advice from a knowledgeable real estate attorney, always consult an attorney who is licensed to practice in your state.

Tenant shall have the right to assign its lease or sublet the premises with the Landlord’s prior written consent providing that the Tenant or sub lessee will not violate any other restrictive covenant, then in effect in the center and of which Tenant has notice. It is expressly understood that Tenant shall have the unrestricted right to assign, sublet, license or transfer (hereinafter collectively “Transfer”) any or all of its rights and privileges under the lease.

You should consider both options and the consequences before deciding to subletting or assign your lease. You may find yourself wanting to move back into your space and if you assign your lease you give up that right. If you can’t terminate your lease which is the cleanest and lease complicated solution be sure that any assignee is a rock solid Tenant, or structure the transfer as a sublet, so that if the subtenant falls short, you can at least retake and use the space.

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Apartment Lease Takeovers: What Are They and How Do They Work?

Lilly Milman

By Lilly Milman

Aug 04, 2023

So, you signed a one-year lease on a place — and now, whether it’s because of a change in work, finances, or lifestyle, you need to move out. What should you do?

Most apartment leases include a clause that requires renters to pay a fee or penalty for breaking the lease , and the consequences can go even further than your wallet. If you need to break your lease and you were behind on payments, you could be taken to court by your landlord or your credit score can take a hit. Your landlord may also become a bad reference who you won’t want to reach out to in the future.

If you want to avoid breaking a lease, you have a few options — like transferring your lease to a new tenant via a lease takeover. In this guide, we answer all your questions about lease takeovers, how they work, and how you execute them correctly.

What is a lease takeover?

A lease takeover is a legal transfer of a lease from one tenant to another. It’s one way to leave an apartment without having to pay a lease-breaking fee. It requires you to find a new tenant, who, once approved by your landlord, will sign a document accepting that they are now responsible for your prior rental unit.

What is the difference between a lease takeover and a sublet?

While they might seem similar, a lease takeover and a sublet or sublease have some important differences. When you execute a lease takeover, you are transferring your rental to a new tenant, and you will no longer have any claim to the unit. If you sublet your room or apartment to a new tenant, then you are allowing them to live in and pay for the unit, but the landlord can hold you personally responsible for following all the terms of the lease — including paying the remaining rent if your subletter defaults on payments. In a sublease, the original tenant’s name remains on the existing lease, and the new tenant signs a separate subletting agreement (rather than a new lease).

Not all leases allow for takeovers or sublets, so you will have to carefully read your lease terms to deduce whether or not you’d be allowed to do either when intending to move out. Both also must be approved by your landlord. While they can be risky, they can also be easy ways to find a short-term rental.

How do lease takeovers work?

There’s a few steps to properly completing a lease takeover, where you are fully let off the hook for the terms of your original lease.

1. Get your property manager or landlord’s permission.

Even if your lease allows for a lease takeover, you will want to loop your landlord into the process as soon as possible. There’s a chance your landlord will let you break your lease without a fee, or that they’ll want to find a replacement tenant on their own or with the help of a trusted leasing agent. If you want to keep your landlord as a reference for future apartments, you’ll also want to stay on good terms with them — and communication and transparency are fundamental to good tenant-landlord relationships. Landlord approval will also be required to get the new tenant signed onto a new rental agreement, so you will not be able to avoid letting your landlord know about the transfer down the line.

If your landlord is not giving you permission to transfer your lease, check local laws or state laws and see if you can find anything that would require them to let you out of your lease without a fee.

2. Start looking for a tenant

Once you’ve gotten your landlord’s consent, it’s time to find a new renter. In most cases, the departing tenant will need to find a new tenant on their own. The prospective tenant will need to go through the same application process that you did — filling out a rental application, going through a background check and credit check, paying a security deposit, etc. — so if you want to ensure the lease takeover goes through, do a little vetting to find someone who is responsible and will be a good future tenant.

3. Write a lease transfer agreement.

This is also called an assignment of lease form. Look up a template online and make sure there is a clause stating that you are no longer responsible for fulfilling the terms of the lease after the new tenant moves in. This contract should also include your name, the new tenant’s name, your landlord’s name, the address of the unit, the monthly rental payment, and any other clauses that you and your landlord see fit. You will need to get this contract signed by your new tenant and your landlord, and as the current tenant, you will need to sign it yourself

Are there fees associated with lease takeovers?

If your original lease agreement did not allow for lease takeovers, then you may have to pay a lease-breaking penalty or forfeit your security deposit. If your landlord does allow takeovers but decides to clean and repair your unit in between tenants, they may also withhold part of your security deposit in the event that they need to fix damages to the unit that you caused past normal wear and tear.

However, you will be released from owing your landlord rent after the new tenant moves in, as long as you were in good standing with your rent payments up until that point.

How do you find apartment lease takeover opportunities?

A lease takeover can be one way to get into an apartment complex or building that rarely has openings. If you are looking for a lease takeover, you can try searching on housing groups online on platforms like Facebook, Facebook Marketplace, and Craigslist. You can also put out a call on social media. Just make sure you complete a walkthrough of the potential property before signing any paperwork; you’ll want the unit to be in good condition, the roommates (if there are any) to be a good fit for you, and the landlord to be responsible. Always do your due diligence before taking over someone else’s lease.

The Bottom Line

A lease takeover (also called a lease transfer or assignment) is one way to get out of an apartment before the time period of your original lease is up. If your landlord allows for takeovers, then it can be a way of avoiding any lease-break fees and releasing yourself of lease obligations — thus opening you up to sign a new lease for a new apartment elsewhere. Just make sure you do your due diligence while writing up any lease assignment agreements, finding new tenants, or moving into new apartments through a lease takeover.

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Subletting and Assignment

On this page you will find information on what subletting and assignment involve in a tenancy and what the rights and responsibilities of tenants and landlords are in this area. It is important this is understood at outset of a tenancy.

  • Types of Tenancies and Agreements

Page contents

What is subletting, what is assignment.

Subletting occurs when a tenant permits another party to lease the rental property that the tenant has leased from the landlord. The tenant then assumes the position of landlord (known as the head tenant) in relation to his or her subtenant. Subletting usually occurs because the tenant has signed a  fixed-term lease  and wants, for whatever reason, to get out of the lease before it expires. Subletting can only take place with the consent of the landlord.

Where a landlord refuses the tenant the option of subletting, the tenant can serve a  notice of termination  to end the tenancy if they so wish.

Subletting is not available in Approved Housing Body tenancies.

What is assignment?  

Assignment is where a tenant transfers his or her entire interest in a tenancy to a third party. The original tenant then ceases to have any interest or involvement in the tenancy and the assignee becomes the tenant who now deals directly with the Landlord.  

If a tenant assigns a Part 4 tenancy to a person other than a sub-tenant, the protection provided by a Part 4 tenancy ceases.  The new assignee will require 6 months of continuous occupation in the dwelling before qualifying for Part 4 tenancy rights. 

If a tenant assigns a dwelling to an existing sub-tenant, the Part 4 tenancy will continue to exist in favour of the new assignee for the remaining period of the original Part 4 tenancy and the assignee becomes the tenant of the Landlord.  

Assignment can only take place with the consent of the landlord.  Where a landlord refuses an assignment of a fixed term tenancy, a tenant can serve a notice of termination on the landlord.  

Tenants of Approved Housing Bodies are not permitted to assign or sublet the tenancy. 

IMAGES

  1. Roommates, Subletting, and Assignment Landlord and Tenant Form

    assignment subletting and replacement tenant fees

  2. Infographic

    assignment subletting and replacement tenant fees

  3. Assignment, Subletting, and Mortgaging by Tenant

    assignment subletting and replacement tenant fees

  4. What You Need to Know About Subletting

    assignment subletting and replacement tenant fees

  5. Lease Assignment and Subletting

    assignment subletting and replacement tenant fees

  6. Comprehensive guide the the Tenant Fees Act 2019

    assignment subletting and replacement tenant fees

VIDEO

  1. SUBLETTING IN NYC 🤣🤣

  2. New Tax Rule on Assignment Sales #shorts

  3. Unit 11 Landlord and Tenant

  4. spot replacement snow science assignment solid square daughter

COMMENTS

  1. Subleases and Assignments by Tenants & Related Legal Concerns

    Liability The original tenant will remain liable for rent that the assignee does not pay unless the landlord agrees otherwise. Assignments can be risky because the original tenant remains on the hook to the landlord for all of the remaining rent if the assignee fails to pay it.

  2. Are Sublet Fees Legal?

    Talk to an Attorney. Landlords should not charge sublet fees unless it is expressed in the lease agreement. As a tenant, you have rights that you can legally enforce. If your landlord is charging you sublet fees contrary to your lease agreement, speak to a landlord-tenant attorney to get legal help. Too complicated / too many steps.

  3. Tenants and Subtenants Obligations under a Sublease Agreement

    1. Differences between a sublease and an assignment 2. How to get permission from a landlord to sublet 3. Responsibilities and liabilities of the tenant and subtenant 4. Protective measures for the tenant 5. Sublease alternatives Key terms and definitions

  4. Charge Tenants a Fee for Processing Their Assignment & Sublease Requests

    Payable for each assignment or sublease request the tenant makes and that you need not process the request if the tenant doesn't make the accompanying payment [Clause, par. a]. Potential Compromises If a tenant with significant negotiating leverage flatly refuses to accept the fees clause, you don't have to ditch the idea completely.

  5. Lease Tips: Assignments, Sublets, and Everything In Between

    Have a waiting list of available tenants. In that case, the landlord could allow an early termination, and enter into a new lease with a new tenant. Agree to allow the exiting tenant to find a replacement tenant. Assuming the current tenant is responsible, he or she has strong incentive to find another person who can jump in and pay the rent.

  6. All About Subletting

    There are 3 possible ways that a landlord might communicate to the tenant that subletting is the only option (which isn't true): The lease says that subletting is the only option. A lease that doesn't allow a tenant to break a lease, and only allows the tenant to sublet is a probable violation of Wis. Stat. 704.44 (3m).

  7. Texas Subleasing Laws (2024): When It Is & Isn't Legal to Sublet

    Lease Clause Requiring Landlord's Permission. "Tenant shall not assign or sublet any part of the leased premises without prior written consent of Landlord.". In this situation, a tenant could be allowed to sublet, but must receive additional written consent from the landlord prior to doing so.

  8. Assignments and Subletting in Commercial Lease Transactions

    without the tenant retaining any reversionary interest in the lease. See, e.g., B.C. & H. Corp. v. Acme Markets, Inc. 19 Pa. D.&C.3d 419 (1980). The failure of the tenant to retain a reversionary interest in the lease is one of the key distinctions between an assignment and a sublease.

  9. Subleasing vs Assigning a Lease: What's the Difference

    Lease assignment and subleasing a rental unit — whether residential or commercial — can both help you make some extra money from your unused rental property. But one is much more permanent than the other. Learn which option best suits your needs and situation by understanding the difference between subletting and assigning a lease.

  10. Subletting 101: Everything to Know About Subletting Your Apartment

    Clarify certain things such as the subtenant's rights and responsibilities, if the rental payments should be sent to the landlord or yourself, and information about the security deposit. 6. Pick a reliable subtenant. Choosing the right person who will be living in your apartment is half the success.

  11. Assignment vs Subletting

    Share Assignment vs Subletting - What are the differences? Assigning a residential lease agreement and subletting are two distinct ways of transferring tenancy rights in a rental property, each involving different legal and practical implications. Here's a breakdown of their differences: Assignment of a Residential Lease Agreement: Definition:

  12. Assignment vs. Subletting: Do You Care Which One You Use (or Why

    Lease forms also typically obligate the tenant to pay a "review fee" and/or to pay for the landlord's attorneys' fees incurred in connection with the proposed assignment or sublease. In addition, the tenant is frequently obligated to pay to the landlord all of the "profit" or "excess" consideration received by tenant from the assignee or sublessee.

  13. Handling Subleases and Assignments as a Landlord

    Creating a New Tenancy While allowing a sublease or assignment may be advisable in some situations, in many cases the best and simplest option is to terminate the original tenant's lease in writing and begin a new lease with the new tenant.

  14. Subletting And Sub-Lease Agreements In The USA

    PUBLISHED ON 18 Dec 2019 Contents What is Subletting? Your subletting approach Managing and screening subtenants Subletting laws What if you don't want to allow subletting? Subletting Fees Final Words A landlord's top priority is to avoid vacancies.

  15. What is a reasonable sublet fee for a landlord to charge if not stated

    Any assignment or sublease will not relieve the Tenants of further liability under this lease." This is all it says under the Sublease section. I recently asked my landlord about subletting and she said I could but she would charge me a $700 fee. It didn't say anything about this fee in the contract that I signed so I am wondering if it is viable.

  16. Assignment, Subletting and Replacement Tenants

    Should Landlord agree to an assignment, sublet, or replacement tenant, Tenant will pay Landlord $250.00 plus any lease modification fees. Unless expressly stated otherwise in an assignment or sublease, Tenant will not be released from Tenant 's obligations under this Lease because of an assignment or sublease.

  17. Assignment and Subletting Clauses in Commercial Leases

    The original tenant must pay the landlord's expenses and other reasonable costs (legal fees, financial analysis assistance) that may be incurred when considering any replacement tenant, whether that replacement tenant is ultimately approved.

  18. Understanding Assignment Versus Subleasing

    Assignment and subleasing are types of transfers. Lease restrictions can include a requirement that tenants obtain landlord consent prior to any …

  19. Sublet vs. assignment—what's the difference?

    Subletting for the entire length of the lease is an assignment. An assignment allows you to hand off the rental to a new tenant for the rest of the lease term. This is what Mustafa ended up doing. What's important is that either way—with both a sublet and an assignment—you are giving up your rights to the rental but in both scenarios you ...

  20. ASSIGNMENT AND SUBLETTING FEES Sample Clauses

    Related to ASSIGNMENT AND SUBLETTING FEES. Assignment and Subletting (a) Except as provided in subsection (d) below, without the prior written consent of Landlord, which may be withheld in Landlord's sole discretion, Tenant may not sublease, assign, mortgage, pledge, hypothecate or otherwise transfer or permit the transfer of this Lease or the encumbering of Tenant's interest therein in ...

  21. Subletting and Assignment of Lease: What is the Difference?

    Tenant shall have the right to assign its lease or sublet the premises with the Landlord's prior written consent providing that the Tenant or sub lessee will not violate any other restrictive covenant, then in effect in the center and of which Tenant has notice.

  22. Apartment Lease Takeovers: What Are They and How Do They Work?

    A lease takeover is a legal transfer of a lease from one tenant to another. It's one way to leave an apartment without having to pay a lease-breaking fee. It requires you to find a new tenant, who, once approved by your landlord, will sign a document accepting that they are now responsible for your prior rental unit.

  23. Subletting and Assignment

    Subletting usually occurs because the tenant has signed a fixed-term lease and wants, for whatever reason, to get out of the lease before it expires. Subletting can only take place with the consent of the landlord. Where a landlord refuses the tenant the option of subletting, the tenant can serve a notice of termination to end the tenancy if ...