A sublease agreement is necessary when a tenant needs to “sublet” their property. This refers to an agreement when a tenant, who is already on a lease, wishes to move out of the premises without breaking their lease. Instead, they find a replacement tenant to take over the remainder of the lease. It is a fairly simple piece of documentation that is straightforward to draft. To help you out, we’ve compiled a list of things you should know when drafting a residential sublease agreement!
Things to Consider When Drafting a Sublease Agreement
First and foremost, you should check your original lease agreement. Many rental agreements have sublet clauses that specify how the process of subletting the property should be carried out. If your lease agreement doesn’t have such a clause, you should speak to your landlord and/or the rental company to make sure they approve of the sublease. Once that’s done, be sure to obtain approval in writing (sublease consent).
Once you’ve obtained approval, you’ll need to deal with the specifics and particulars of the sublease arrangement. Typically, you’ll need to consider the following details of a sublease;
- Payment: Payments will need to be specified in writing. This includes the amount, method of payment, and the beneficiary. (This refers to whether the payment goes through you, or directly to your landlord or rental company.)
- Intervals of Payment: The sublease agreement will need to specify when payments are to be made. This is a simple statement to draft and can be something along the lines of “The subtenant shall pay the monthly rent of $1,000 directly to the landlord (or to the tenant) on the first of each month.)
- Method of Payment: Bank transfers, wire transfers, electronic deposits, and mail-in checks are all viable options. Again, this will need to be specified in writing.
- Late Payment: Consequences in the instance that payment is late, or has not been made altogether. The sublease agreement should specify any repercussions (typically, these are fines) if payments are late, or haven’t been made at all. Alternatives include contracting a collections agency if payments are still pending, and the subtenant isn’t responding.
- Receipts and Documentation: Once the method of payment have been agreed upon, and the tenant will have to provide the subtenant with receipts as proof of payment. The sublease agreement should state how the tenant plans to do so.
- Security Deposits: This varies greatly from state to state. This part of the sublease agreement should specify how much the subtenant is required to pay as a security deposit (if applicable) and when it will be returned to them, contingent on their behavior on the premises. Many states, like California, require this amount to be deposited back to the tenant or subtenant within 21 days of vacating the property.
Once these particulars are listed out in the sublease agreement, the tenant will then have to get the subtenant to verify the condition of the property to avoid any liability further down the line. This generally entails creating a list of things in the house, such as walls, curtains, toilets, utilities, and the like, and doing a walk-through with the subtenant to confirm that they are in good condition. Additionally, the terms of the original lease agreement still apply, so subtenants will need to be briefed on things like parking spaces, pet policies, and prohibited practices, such as the use of drugs or smoking on the premises. Once this is done, they should sign and verify that each area of the premises is in good condition.
Template 1: Residential Sublease Agreement
Once all of the aforementioned particulars are in order, you can begin drafting the sublease agreement. To help you out, we’ve created a template that you can follow, which can be found below;
This document entails the terms, conditions, and particulars of the sublease agreement for the property located at __________________________, scheduled to begin on and follow through until between the following parties;
Upon signing and providing this document, the subtenant hereby agrees to adhere to the following terms and conditions:
(a) The subtenant will make a monthly payment of __________________________, which is to be made out to on the first of each month. (This can be modified to whatever is agreed upon between the tenant and subtenant.)
(b) The subtenant is obliged to make the payment through (Typically, bank transfers, mail-in checks, and wire transfers are acceptable methods. In the case of a mail-in check, be sure to add a physical mailing address to which payment should be sent.)
(c) Upon payment, the subtenant is entitled to receive a receipt as proof of payment (you may specify the means, i.e., physical or digital) within of payment.
(d) In the instance that payment is late, the subtenant will be subject to an additional charge of __________________________ . The exception to this would only be with written pre-approval from the tenant.
(e) In the instance that the subtenant continues to delay payment(s) or is delinquent for more than __________________________ , the tenant will work towards initiating the following procedures;
(f) The subtenant hereby assumes responsibility for the payment of any, and all utility bills pertinent to the property at (In the case that you have additional roommates, you will need to list out how utilities are divided and that the same arrangement will continue to be in place.)
II. Security Deposit
(a) The subtenant will pay the amount of __________________________, due to function as a security deposit in the case of damages incurred during the subtenant’s stay. This amount will need to be paid to by the date on which the sublease is scheduled to start.
(b) When the sublease agreement has run its course and has concluded, the tenant will inspect the property for damages and deduct any appropriate charges from the security deposit with written explanations and receipts provided to the subtenant within 21 days from the date on which the sublease ends, or the subtenant chooses to move out.
III. Walk-through Conditions
Below is a checklist with accurate descriptions of the state in which each room existed on the date on which the sublease agreement is scheduled to commence;
ROOM CONDITION CONDITION
(Start of lease__________________________) (End of lease__________________________)
Exterior (This typically includes things like parking spots and balconies.
Other (Any particulars that need to be specified may be listed here.)
IV. Rules of the premises
The subtenant hereby agrees to adhere to the following rules whilst occupying the premises from the start of the lease to the end of the lease.
(a) The subtenant will have access to use the following facilities; (Specify things like a gym, pool, etc. if applicable. Make sure to specify what facilities the subtenant will not have access to as well.)
(b) The subtenant will promptly return keys and/or keycards to the upon the termination of the sublease agreement.
(c) The subtenant will be subject to the following policies. Failure to abide by these policies may result in a forfeit of a part of, or the entirety of, the security deposit and/or termination of the sublease agreement altogether.
V. Terms of the sublease agreement
The subtenant is hereby obliged to adhere to the terms, conditions, and policies of the original leasing agreement, which, for reference, is attached below.
This document is hereby legally binding upon signature by the subtenant and receipt by the tenant. Upon receipt, the tenant will sign and provide a copy of this document via the Additional copies will also be submitted to the landlord or rental company. The subtenant may commence occupancy of the premises only after, and not before, both parties have agreed to the terms and conditions laid out in this document.
Template 2: Sub-lease Agreement
Templates by State
Frequently Asked Questions
Sublease agreements occur when a tenant wishes to move out of a property but does not want to break his/her lease. As a result, the tenant finds a replacement to occupy the premises, i.e., the subtenant, who then takes up the remainder of the lease.
Typically, subleases cannot be broken without paying a hefty fee. In the instance that a sublease has been broken prematurely, both the tenant and subtenant may be liable to the landlord and may be forced to pay a certain amount in fines and additional fees. General convention dictates that an extra month’s rent will be collected upon premature termination of a lease agreement.
If a subtenant has misused the property or has not adhered to the terms of the sublease agreement, they may be evicted by the landlord. Additionally, some landlords may not allow subleasing, to begin with. In such cases, the subtenant may be legally evicted by the landlord without the need for any notice and/or reason(s).