Cotenants, Sublets, and Lease Assignments for Your Rental Property

When leasing a property, you may be faced with issues about cotenants, sublets, and lease assignments. Each of these areas can have specific problems that may affect not only your rights, but also the rights of tenants. It is important to fully understand the implications of all three areas.

Cotenants. When an existing tenant invites a roommate to share the rented property, the new roommate is considered a cotenant. A cotenant will have the same responsibilities as the original tenant in keeping your lease agreement. But enforcing this is not always easy.

To avoid problems, stipulate that your existing tenants must notify you if they plan to add a cotenant to the lease, and that it requires your consent. Have your tenants agree to this in advance, and make it part of the lease agreement, so they can be held liable if they break any portion of this agreement.

Sublets. A sublet occurs when an existing tenant moves out of a rented dwelling and rents it to another individual. This can cause liability problems for both the tenant and the landlord. If the sublet tenant is not bound by your lease agreement, the initial tenant is responsible for fulfilling the rental agreement.

If you do not want your tenants to sublet their dwellings, state this clearly in your lease agreement. If you do decide to allow subletting, make sure you require the subletting party to provide you with all the necessary information on the new tenant, including their name, previous address, and Social Security number. Screen a subletting tenant just as you would a regular tenant.

In some cases, subletting turns out to be a nightmare for all parties. If the subletting tenant leaves without paying his or her rent, or damages the property, the initial tenant should be held responsible for the back rent and property damages. In other cases, the subletting tenant may make demands of their landlord, the initial tenant. If such demands involve the property, they should be passed on to you — and your decision is final — not that of the initial tenant, who is acting as a landlord. 

Lease assignments. A lease assignment occurs when a tenant leaves a rented dwelling before the lease agreement expires, but provides a new tenant to take over the remaining portion of their lease. When this occurs, you'll want a written consent assignment to legally transfer lease obligations to the new tenant.

In this situation, it's easier for the landlord to screen prospective lease assignees, so discuss these options with the current lease holder. Once the new tenant takes over the lease agreement, all responsibility should transfer to the new tenant. Make sure you're completely comfortable with this new tenant before allowing the assignment to take place.

A lease assignment helps a landlord maintain occupancy on a property even if the current tenant is unable to stay for the duration of the lease agreement. It also gives the landlord the ability to meet with the new tenant and fully inform them of their new responsibilities, lessening the chance of confusion for all parties.

No matter what kind of arrangement you are faced with as a landlord, you must have written documentation and agreements to completely protect your rights. Any new tenant, whether they are corenting, subletting, or taking over a lease, should be required to fill out a lease agreement, and agree to follow your property's code of conduct or set rules.

If you have noticed a new tenant who you don't recognize, or if you think that your existing tenants may have added cotenants without your knowledge, check with your tenants immediately to minimize the risk of misunderstandings and problems. Staying informed about the people living in your rental property will let you take appropriate steps to protect your property and your rights.