The Scoop on Subletting

subletting

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What is subletting?

First, let’s make sure we know what subletting means!

Lessees have a lease with their landlord— their name is on the document that binds them to following their contract and paying their landlord. Subletting is when the lessee rents out their apartment to another person whose name on not on the lease. Many leases will ensure that the tenant is not intending to sublet (more on this later), and subletting, if you’ve signed a lease saying you will not not, is illegal. In these cases of illegitimate subletting, landlords do not know when their apartment is being sub-letted. And, usually, it comes as a pretty unwelcome surprise. But, in some circumstances, it is legal and perfectly acceptable to sublet your apartment.

Why would A Tenant Decide to Sublet?

I’m sure by now you’ve heard about the rise of AirBnB, the popular site where “hosts” can allow tourists to stay in their homes for short periods of time. It’s a smart idea, and potentially lucrative! Lots of tenants are hoping to hop on the short-term rental band wagon and get to making some extra money by (legally or illegally) subletting out their rental.

Conversely, perhaps the tenant is planning to go away from a few months and wants to pay for a friend to live in their apartment in their absence and take good care of their property. Students, in particular, might want to sublet. If they’ve rented a house for the year, but plan on taking an internship during the summer or going abroad for a semester, subletting their apartment to their friend might be an option.   

Why A Client Might Choose Not to Sublet

Subletting might be seem like a good way to earn some extra cash or keep the apartment occupied during their absence. However, clients need to know some important things about subletting. 

First, and most importantly, subletting can be a major breach of contract. If the landlord has not specified that the apartment can be sublet, then any subletting action taken on behalf of the tenant is illegal. Of course, it’s super important for a client to maintain a good relationship with their landlord! So, even if the landlord has said on the contract that they will accept sub-letters, tenants need to make sure that they have a long conversation with their landlord and communicate everything clearly. 

Also, subletting has the potential of causing insurance complications (Check out the last blog post I wrote about that: Renters Insurance: Everything You Need to Know.) Your client’s insurance might not cover those who sublet the apartment from them. Often times it will. However, tenants need to make sure to check with their insurance provider to clarify if their property and any eventual injuries that their sub-letter might incur in their home.

Why Do some Landlords Allow Subletting?

It’s worth noting that not all landlords are opposed to subletting! Some of them allow their renters to have people who are not on the lease to stay for extended periods of time. If their renter is planning on spending time out of the country— this is especially true for students who might go away over the summer, or spend a semester abroad— it could be beneficial for the landlord to ensure that the rent will be paid and the property will be safe. 

Why Do Some Landlords Not Allow Subletting?

The big reason that landlords feels uncomfortable with submitters is that they do not get to screen sub-letters. The screening process to find full-time tenants is comprehensive, and landlords have access to the confidential information they need to make a decision on who fills their vacancy. As a result of this lack of control, many landlord’s don’t feel comfortable with having a sub-letter. They might be pose risks of noise complaints. Or, the sub-letter might have a bad history with renting that would have excluded them had the landlord made the decision. 

Why Should Real Estate Agents Care?

As a real estate professional, it’s most important to educate your client about what subletting is and why landlords might allow or disallow it. This way, your client won’t accidentally be subletting their apartment and inadvertently breaching the terms set forth on their contract. Again, with the popularity of Air B&Bs, many clients might think about subletting (but not think about the legal trouble it might place them in!) When you’re going through the lease, explaining each part to your client, make sure to carve out some time to talk about subletting! Feel free to share this article. Let them know why they might be considering it, what they should be beware of, and why the landlord might allow (or disallow) it. Subleasing can be complicated, and, if there’s any confusion, make sure to get legal guidance or advise your client to get some!

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