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A sublease agreement is an agreement between a tenant and a third party establishing a relationship where the tenant rents the property to a third party for all or a portion of the lease.
It is important to note that in any lease agreement, there may be a clause explaining whether or not a tenant may sublet.
If so, it is imperative to draw up a sublease agreement to ensure all rights and duties of all parties are documented and transparent.
What Is a Sublease Agreement?
A sublease agreement is a rental contract between a tenant currently renting a property from a landlord and a third party.
The original tenant becomes the sublessor, and the third party renting (or rather, subletting) the property is called a sublessee.
The sublessee rents the property for all or a portion of the duration of the original lease agreement. Generally, the sublessor retains full responsibility for rent payments.
For example, if the sublessee fails to pay rent, the sublessor is still bound by the original lease agreement and must pay the landlord the missed rental payment. Similarly, any damage to the property not corrected by the sublessee is the responsibility of the sublessor.
Why Do You Need a Sublease Agreement?
A sublease agreement is needed to establish the terms and conditions of a tenant-subtenant relationship. If a tenant is looking to sublet to a third party, he or she must protect the integrity of the original lease agreement.
Therefore, the sublease agreement will reiterate the existence and legality of the original lease agreement.
It is essential for all parties involved to know their rights and duties.
When Do You Use a Sublease Agreement?
You use a sublease agreement when a tenant wants to rent all or a portion of their lease term to a third party.
For example, a typical example of a sublease is a university student renting an apartment for three years. The school year is typically from September to May.
During the summer months of June to August, the student returns to their hometown, so they sublet those three months of their lease to a summer vacationer.
Remember: The tenant is still liable to the original landlord for rent and damage to the property.
If that summer vacationer does not pay the last rental payment for August, the university student must pay the landlord the August rent.
What To Include in a Sublease Agreement?
Generally, a sublease agreement will include the following:
- Description of the property: Give a detailed description of the property. Is the sublet of the entire property, or is just one room?
- Name of tenant and subtenant: Give the names of the original tenant/sublessor and the subtenant/sublessee.
- Term of sublease: State the length of the lease. Note that without the landlord’s consent, the sublease agreement cannot be longer than the rental term of the original lease.
- Rental price: State the rental price of the sublease.
- Reference or description of the original lease agreement: It is always important to mention the original lease. For example, note that the subtenant must abide by the terms and conditions of the original lease and the clauses in the sublease agreement. For instance, if the original lease prohibited pets and parties after 9 P.M., the subtenant is bound by those rules.
- Security deposit: State whether or not the subtenant must give the sublessor a security deposit. If so, note the amount.
How to Write a Sublease Agreement
Follow the steps below to write a sublease agreement.
Step 1 – Describe Property
Note the property type for rent and the property address.
Step 2 – Write Tenant and Subtenant Names
Enter the names of the original tenant and the subtenant who will lease part or all of the property.
Step 3 – Note Sublease Term
Fill in the lease term and when the lease begins and ends.
Step 4 – Enter Original Lease Details
Write the terms of the original lease that the subtenant is bound by, such as smoking or pet rules.
Step 5 – Fill in the Rent Amount
Define the rent amount and the day rent is due. Note any prorated rent amounts.
Other details you should write into your sublease agreement include the following:
- Landlord approval
- Sublease security deposit
- Late fees
- Utility details
- Furnishings use
- Property alternation restrictions
- Subletting policies