What is a Sublease Agreement (Sublet Contract)?
A sublease agreement also termed sublet contract, sublease or residential sublease contract, refers to a formal agreement made between two parties including the current premises occupant and the prospect occupant replacing them. The purpose of a sublease agreement is to enable a current lessee to further lease out the premises to another lessee while remaining the main occupant according to the master lease agreement.
The master lessee can sublet the premises and may choose to either remain present on the premises or to not. Such lease agreements are commonly used by lessees who desire to share the premises with a roommate or because they hold a job in the military and are planning to vacate the premises for a certain period of time. This agreement can also be considered a room lease agreement in case the main lessee still plans to live on the premises. This type of renting can only be put into effect after the agreement from the owner of the premises. This will also require the master lessee to carefully consider the terms of their contract to find out whether the master agreement allows them to sublet further or not. In case this sort of arrangement has not been allowed in the master agreement the lessee will be under the obligation to receive a written letter of permission first.
A number of factors pertaining to the lease have to be assessed and decided upon such as the execution date and expiration date for the new sublease, the rent to be paid per month, and additional costs (if any) to be paid by the new lessee for the premises. It is important to consider adding maximum details pertaining to the lease and also hire a lawyer to review the terms of the contract to ensure adequate aspects and factors have been covered.
For how long the lease can remain valid?
How long the lease will remain effective is mainly put forth in an agreement prior to the rental of any house or apartment. A common agreed upon period of lease is often one year. There is always a possibility of uncertain cases that may require further adjustments or terminations to be made. The original lessor is often unable to live in the leased premises for the full period agreed upon initially as factors such as a job transfer, birth of a baby, marriage may require the lessee to vacate the dwelling prior to the completion of the full length of the period. Releasing yourself from the agreement earlier than agreed will bring in many issues for the lessee and for this purpose they often prepare to keep the property occupied by subletting it to someone else who will cover their obligations for payment of monthly rents until the completion of the agreed leasing period.
Publicly available Sublease Contract
A publicly available sublease contract form can act as a legally binding document and the master lessee can use it to start the subletting process. This may be a very cost-effective approach and help the original lessee eliminate any fees by the lawyer for the draft, it is still a preferable option to getting the form reviewed by a legal consultant.
As it has been advised before herein that the master lease agreement should be reviewed to find out if the owner allows you to sublet. In case allowed, the master lessee is obligated to align their agreement details with the details in the master agreement. Similarly, the master lessee should be very careful in his consideration to ensure that it has been submitted to a responsible lessee as only the master lessee will remain responsible for any damages made through the sublessee’s default.
Sublease Agreement Definition:
The sublease agreement form is used to enter both the master lessee, who is the current tenant and a sublessee, who will replace them to acknowledge a mutual agreement. It should be taken into consideration that generally subleasing is restricted in the original lease agreement. If it is allowed, the lessee should ensure that the details on the sublease agreement align with those of the original agreement.
Why use a Sublease Agreement?
They are an important tool for lessees who want to vacate the property before their full length of the agreed lease period is reached. With the execution of such agreement, it becomes convenient for both parties, the lessee and sublessee to fulfill their housing needs in a formal manner keeping them both legally bound to fulfill their obligations.
What Types of Properties Can be Sublet?
Generally, any type of rental property is eligible for sublease. However, there are many legal implications involved which decide whether it is permissible to do so or not. These implications will be clarified in the master lease agreement signed by the owner and the original lessee. The master lease agreement may also include further details such as prompting the original lessee to request formal permission in written form by the owner. Generally, condos and apartments are the most commonly sublet property types.
Why signing an Agreement is better than an oral agreement?
It is a common cause for lessees to bear the damage caused to the premises by the sublessee, mainly in the case where an informal agreement had been used. Informal agreements such as the ones done orally can not be put in full force and are not legally binding either. Such cases can also take place and misunderstandings can arise despite the fact that the two parties have had good previous relationships such as they have been friends or relatives. Using a formal written agreement with maximum details about the terms and conditions of the agreement may be the only approach that makes accountability and well- articulation convenient for both parties involved. The owner will only be eligible to put the lease agreement in full force towards the original lessee and not the sublessee. Because of this, the original lessee will be the only one accountable for the end condition of the premises. Further unpleasant instances may also occur such as the sublessee may not abide by the pre-decided agreements and refuse to vacate on your return and in response, the owner may evict both of the parties. To shield yourself from such inconveniences, it is important to cover as many aspects of the lease agreement as possible such as length of the lease period, monthly rent and security deposits.
Is Subletting Legal in your city?
Subletting is normally not illegal under any city’s laws but it can be made impermissible by the lease agreement signed. Sometimes, the owner-lessee laws in some cities may hold privilege over the demands of the owner disabling the owner from refusing the right to sublet. However, receiving formal permission from the owner is still recommended. Under the laws of some states, the owner is legally allowed to evict both of the parties in a sublease agreement if they did not seek his permission first.
Sublease Agreement vs. Lease Agreement
A sublease agreement serves the needs of the master lessee and the sublessee replacing the current occupant. In comparison, a Lease agreement is used for the purpose of the agreement between the owner of the rental property and the original lessee. The majority of the leasing agreements do not permit subletting.
What are the Components of a Sublease Agreement?
A sublease agreement is mainly derived from the contents of the Master lease agreement. Other contents of the agreement comprise the monthly rent to be paid by the sublessee, which may be equal or lower than the original monthly rent. For instance, if the sublessee is only occupying as a roommate he will be required to pay only a portion of the full rent whereas in the case where the original lessee will be vacating the property and the sublessee will be using all of the property he will be obligated to pay the complete rent. It is also important to clarify the manner in which rent is to be paid. For instance, it is to be mailed to a specific address and whether it is to be transferred to a property manager or the owner. An adequate sublease agreement should also include other payments that are to be paid pertaining to the property such as security deposit, utility payments, any applicable insurance required for the sublessee, an inspection form and also a lead-based paint disclosure (if the dwelling was built before 1978).
Elements of a Sublet Lease Agreement
Other important terms to incorporate into the sublet agreement are listed below:
- Legal Names:
The legal names of all the occupants that will live in the premises including all the children as well as adults who reside full-time or in partiality.
- Restriction on a number of occupants that live as tenants:
This serves the master lessee in three ways:
- The lessee will determine what type of individuals live in the property and can allow only the individuals you trust with your property.
- In case the lessee violates this term you are legally allowed to evict the lessee.
- It mitigates the risk of further subleasing by the sublessee.
- Lease Duration:
Period of the lease agreement should be mentioned which may be yearly, monthly, extended over the master lease agreement or [or some other variation between the master tenant and subtenant. ].
- Overdue Fees:
The number of late fees you will charge should also be mentioned; it is to be kept in mind that many state laws have regulated the amount you can charge so any applicable cap should also be mentioned. It should also be mentioned when the late fees will start to accumulate. If you have provided a grace period for late payments inform the lessee about its length as well.
- Any other pertinent fees:
For example, fees for the cleaning of property are to be disclosed (especially in the case the fees are non-refundable).
- Security deposits and other pertinent costs:
Mention the amount of security deposit charged. It should be taken into consideration that the owner-lessee state laws have regulated this aspect of leasing and dictate when the refunds will be made and how the term expires. The notice to be issued to the lessee along with the deposit refund should also be mentioned and also include the amount you used for repairing the damages incurred through the sublessee’s default. However, you are not allowed to deduct any amount from the deposit for reasonable (unavoidable) wear and tear. You may also restrict the possession of pets even if permitted by the owner to further maintain the well-being of the property in your absence.
- Details about maintenance and repair:
Under many governments, lessees and sublessees as well are given the legal right to not pay any rent or only pay a portion of the rent in case any certain maintenance and repair duties are not conducted. The best method to eliminate such issues is to incorporate clear procedures and expectations about how they should reach you regarding maintenance and repair concerns. These terms may also be used to clarify the sublessee about their duties and responsibilities related to the well-being of the property. For example, they are accountable for the cleanliness and sanitation of it [ they may financially liable for any repairs that must be made because of their failure to do so.]. [You’ll also want to include language on the responsibility of the tenant to notify the landlord if there is a problem or a dangerous condition on the property.]. Ensure that all of this information is adequate and also easily understandable. The types of modifications a sublessee is permitted to make to the property and what is excluded. You should also provide them a method to reach the landlord to request permission to alter something in the property. Ensure that the terms related to maintenance and repairs and modifications of the property are in alignment with the master lease agreement.
- Entry to the dwelling:
A representative or the owner may need to access the property for the purpose of reasonable inspections of the property. An entry may also be required in case of maintenance and repairs within the premises. The lease agreement should comprise the same provisions that are detailed in the master lease agreement regarding the entry to the dwelling. This notice that is to be provided in case of a non-emergency purpose is normally dictated by the state law regarding the Owner-lessee relationship.
- Inform about the rulings on any illegal activities:
Even though avoiding to conduct any illegal activities in your home sounds reasonable, such terms and clarifications are still imperative. It will provide you and the owner extra protection from any legal implications in case any illegal activity is in fact conducted by the sublessee. Having such terms in agreement enable you to evict the sublessee with reasonable justifications.
It is also recommended to have a section regarding pets. Firstly, refer to the master lease and check if it allows the keeping of pets or not or requires an additional amount of rent to keep pets. You may also restrict the possession of pets even if permitted by the owner to further maintain the well-being of the property in your absence.
- Mention other relevant restrictions:
You should always cross-check your agreement with the master lease to make sure that all of the restrictions listed in it are made part of the sublease agreement as well.
- Checklist before signing the agreement:
Include a walkthrough checklist that both the parties, the lessee and sublessee can use to conduct a move-in and move-out inspection.
How to Sublet a Property?
Your reason for subletting can be your job in case you have to travel long-term for it. Or maybe it is for the purpose of profit by renting the premises as an Airbnb. Due to any reason, you are preparing to sublet the property. This will guide you through the process:
- Carefully consider your master lease agreement:
This will help you identify whether it is permissible to sublease your property or not. If it has been restricted then you should get the owner’s permission. Take it into consideration that the ultimate answerable individual for any end condition of the property will be you, the original lessee.
- Understand the legislations of your state:
As has been written earlier, the process of subletting a property in its entirety is not illegal in any city. But you can be eligible to enter a sublease agreement with a third-party according to the laws of some state laws regulating the owner-lessee relationships. It should also be remembered that a few other states, such as Texas, give its landlords the right to evict both parties in case you sublease without their consent.
- Property Owner Consent:
Your owner’s approval should still be requested and received despite the law already granting you the right. Also, remember that you are obligated to comply with all the terms stated in your master lease agreement. If you fail to do so, the owner can still legally enforce its ineligibility upon you.
- List the property at the optimal price:
Consider understanding what rents other people pay for similar rentals in your location. Factor in the purpose of your subleasing, if it is to help you pay the full rent or to make a profit.
- Find a suitable individual for the subletting:
It is an important factor because firstly, you and not the sublessee will be accountable for the well-being of the property. You can not afford to lease the property to someone who is likely to cause objectionable damage to it. With this, you want to be able to avoid as many legal intricacies as possible and avoid any problems that may cause this. As a master lessee, it is not preferable to have to sue someone because of their objectionable actions or violations of the agreement. In order to locate a more noble perspective sublessee, you may use property listing sites such as Airbnb, Sublet.com, HomeAway, Short Term Housing and Flip.lease. After the accumulation of some prospective clients, consider screening them for their responsible attitudes and behaviors. You can do so via an application, a background check, a reference check, etc.
- After you have found a suitable sublessee, you can use the guide provided below to prepare your sublease agreement.
Sublease (Sublet) Agreement Writing Guidelines
- Title Appropriately:
As it is a Sublease Agreement it should be titled similarly.
- Reference the sublessor and sublessee in the first section:
Adequately name both of the parties. This section should also comprise the address of the property pertaining to the lease. Also, consider mentioning if the property is furnished or not.
- Mention the agreed length of lease period:
It is important to detail this term as the provisions of the master agreement can not be modified with the extension in the staying period of the sublessee. It can be made shorter than the lease length on the master agreement but not longer. The starting date and expiration date of the agreement are also to be mentioned. The sublessee should also be informed if a holdover is permissible which means if the sublessee can live at the premises at an extended period of longer than agreed upon in the agreement.
- Describe the responsibility of paying rent:
Rent in this context refers to the money that the sublessee is required to pay to the master lessee. The period of payment maybe weekly, bi-weekly or even monthly. The manner in which rent is to be paid may also be mentioned. Such as whether they are to be paid through a cashier’s check or money order and not in the form of cash payments. Also, mention the date on which the rent is to be paid. In case the rent is being paid weekly, mention the day of the week it is to be paid on.
- Explain whether utilities are to be provided within the rent paid:
It is important to specifically mention in case they are not to be included. And it should also be made clear in case responsibility for utilities has been divided among the two parties so mention which certain utilities are to be provided by the sublessee and which ones will be the responsibility of the master lessee.
- Amount of security deposit to be made prior possession:
With the mention of the security deposit amount, the date for a refund of the security deposit must also be mentioned both of which are regulated by the government. In some states, the lessee is required to give the sublessee a list of items that have been damaged when deducting from the security deposit.
- Make sure the terms in sublease align with the terms in the master lease:
For instance, If your landlord has forbidden you from smoking or having a pet in the premises then these same rules will apply to the sublessee as well. It should include all of the rules and remain identical to the master lease. This is imperative in order to eliminate the risk of having to deal with any legal implications pertaining to the agreement.
- Mention about the landlord’s consent:
Keep in mind that some states permit the act of subletting despite the ineligibility according to the lease agreement.
- Give the reference of the governing body:
The governing body refers to the specific state that will be regulating the lessee-sublessee disputes related to the agreement. This state is generally the state of the property’s location, but this is not always true.
- List the other terms and provisions as well:
For instance, if it is permissible for the sublessee to modify the property. And in case they are, do they have to change the property to its initial condition after they vacate?
- Get dated signs of both parties in the agreement:
The form should have the dated signatures of both of the parties.
- In case, a permit has been given by the owner, mention it:
The owner should also date the document and sign it.
- Include a master lease agreement copy if available:
[All of the parties should initial that they received a copy of the master lease. ]
After the sublease agreement has been executed, each party should be given a copy of the agreement to keep in their records.
The Property Landlord Handbook to Leases
This guide may be used as a blueprint by current or prospective landlords to get an understanding of dealing with all the intricacies of leasing and the pertaining real estate actions, such as property management, sublease agreements, and eviction notices.
#2 What Landlords Need to Know
How to Execute the Sublease Package and Transfer Possession of Property
Acknowledge that this guide is wholly based on the assumption that subletting of the premises is permissible. If you have decided that you want to sublease, you shall prepare for the implementation of the sublease package and consign the rights to possession to the sublessee. It is recommended to communicate with both parties in person, the lessee, and the sublessee, in order to review the terms included in the agreement. Through this, the sublessee will get a chance to go over any doubts and also give you the opportunity to ensure that the content in agreement aligns with your original agreement provisions.
Similar to the master lease agreement, the sublease agreement is also subject to varying state laws. The agreement will not be legally binding if it is not reasonable according to your state’s legislation. Ensure the completion of an agreement with the reasonable dates and signature after it has been approved through a review. Keep formal copies of all the documents involved. All three parties should be provided with adequate copies of the implemented lease package including you, the lessee, and the sublessee.
#3 Handling Lease Violations
In case a violation occurs through the sublessee’s default the master lessee may have the right to file for an eviction. What are the ways to determine if a lease violation has occurred other than the inability to pay the due rent? Some violations, for example, a utility shut off will be notified about through an official to the owner. For instance, in case the water has been cut off or the lessee has been ticketed for overgrown grass, a representative from the city will notify about this to the owner of the premises. A property inspector may be able to spot a pet not permitted to be on the premises or any occupants that were not part of the agreement.
In case of a violation, the sublessee must be notified in written form through the master lessee. You may also consult the lawyer maintaining the owner-lessee relationship to decide if the owner should issue a formal notice in case they have been forwarded a notice from the city informing the lessee about the violation committed and advise them to refrain from such actions. A written notice becomes a legal requirement and it should be placed conspicuously so that the sublessee can be aware of it. This can be done through dispatch of a certified mail or by placing it in on the main door of the sublessee’s dwelling.
Landlord-Tenant Matters and Handling the Disputes
The majority of subleases are noble and do not reach their landlord unless there is a reasonable problem. At the same time, there can be some individuals who are hard to deal with. You may find Such individuals to be positive and noble at first sight. There are State legislations that regulate how the owners and lessees deal with any mutual or related issues. It is essential to understand the rules and regulations of your state in order to fully abide by them.
Sublet Lease Agreement Template Download and Preview
SUBLEASE AGREEMENT FORM TEMPLATE
THIS SUBLEASE, Agreement is executed on [Execution Date] BY AND BETWEEN the ________________________ whose address is ________________________, ________________________, ________________________ ________________________ (referred to as the “Sublessor” herein) and ________________________ (referred to as the “Sublessee” herein). A copy of the original Lease is attached to this Agreement. The Sublessee agrees to comply with all the Contractual terms of the Original Lease.
The Sublessor agrees to deliver the possession of the rental unit located at ________________________, ________________________ in the County of ________________________, in the State of ________________________ and ZIP code of ________________________, herein described as ________________________ to the Sublessee, and the Sublessee in response warrants to sublease from the Sublessor for the balance of the lease term, and upon all the contractual terms set forth herein, the stated rental unit, and any other areas pertinent to the sublease agreement are referred to as the “rental unit.”
WHEREAS, the landlord [LANDLORD NAME], has expressed approval of the sublessee’s tenancy at the rental unit mentioned herein provided that the tenancy is in compliance with the contractual agreements set forth herein. In consideration of the mutual agreements made herein, all three parties have agreed to the following:
This Sublease will commence on ______________ and remain in effect for a period of _______________, unless terminated otherwise upon the agreement of both parties.
DELAY IN COMMENCEMENT OF SUBLEASE:
If the sublessor fails to provide possession of the rental unit to the sublessee as per the date agreed upon herein, the sublessor will not be held accountable or liable and such failures or delays will not render this Agreement ineffective or void the sublessee or sublessor of the obligations and terms stated herein. However, in cases of such a delay, the sublessee will be released from any rent payment obligations until possession has been delivered to the sublessee.
However, if the sublessor fails to deliver the possession to the sublessee within sixty (60) days after the due date, the sublessee may release both parties from the obligations pertaining to this Agreement by issuing a written notice about the cancellation of this sublease Agreement.
MONTHLY LEASE AMOUNT:
The Sublessee warrants to pay to the Sublessor a monthly rent of amount ________________________ on the ________________________ day of each month regularly during the course of this Agreement. The sublessee is to make the first rent payment pertaining to this Sublease Agreement immediately after this Agreement is signed.
All the future payments are to be made regularly either in person or via postage to the sublessor’s address as provided herein or via any other method as agreed upon by the parties in written form.
USE OF PREMISES:
The sublessee will be granted the right to full usage and control of the rental unit during the course of this Agreement and until the sublease agreement expires or is terminated.
CONDITION OF PREMISES:
The rental unit is sublet as an “as is property” which means the Sublessee has accepted the rental unit in its current condition with all the faults and defects currently present. Moreover, by signing this Agreement the Sublessee accepts that the property is in good order and satisfactory condition unless stated otherwise as following:
No. Of Units: _____________
Tested: Yes _____ No_____
Working: Yes _____ No_____
KEYS & REMOTES:
|Garage Door Remotes|
|Laundry Room Keys|
WASTE, NUISANCE OR UNLAWFUL USE:
The sublessee is responsible for the maintenance and well-being of the rental unit and shall not use the premises for any illegal activities.
In case any legal proceedings take place pertaining to this Sublease Agreement, the guilty party will be under the obligation to compensate the party proven innocent by the court for all the legal costs incurred by the innocent party such as court fees, filing fees, and any attorney’s fees.
REDOCORATION OR ALTERATIONS:
The sublessee shall not make any amendments, modifications or changes to the rental unit through any means such as doing woodwork or repainting the walls unless written consent from the sublessor has been obtained.
The obligations and terms and conditions stated herein are to be inured to the benefit of and remain enforceable on the assignees, successors or representatives of both parties.
This sublease Agreement is under the governance of the jurisdiction of the state [STATE NAME].
The sublessee warrants that they are of legal age and hold the capacity, power, and authority to enter into this Contractual agreement.
By signing this agreement below both parties agree to the terms and conditions of this Agreement and acknowledge that they have received a copy of this Agreement to keep a record.
(Sublessor Signature) (Date)
City, State, Zip: ________________________,
_______________________________ , _______________________
(Sublessee Signature) (Date)
Driver’s License or ID Number: _________________