What is Subletting? 6 Things You Should Know About it
Life is unpredictable! Sometimes, you would have to move out of your neighborhood, relocate to a different place, or search for a better job opportunity.
Whatever the case may be, you would need extra cash — and subletting would help you do just that.
But, what is subletting, and what should you know about subletting?
Let’s dive right into it.
What is Subletting or Subleasing?
In simple terms, subletting (or subleasing) means renting out your apartment or room to someone else while you move out. The third-party would have to stay in the apartment for the period of the lease.
Here’s the thing; subletting is not all rosy and juicy. Some requirements need to be fulfilled.
Things become more complicated when you take in a lodger.
Well, taking in a lodger can also be seen as subletting. But you’ve got to come up with a tenancy agreement and let the lodger know that they’ve got right to just parts of the building.
Subletting doesn’t mean the lease ceases to be under the original tenant’s name. The original tenant still has a name on the building, but the new tenant takes up the responsibility to pay for rent and take care of the property.
Most folks sublet their apartment when they want to move out. Others merely want to move before the lease expires.
Whichever category you fall into, subleasing is a great way to get things rolling and get some monetary benefit.
Pros of Subleasing
- Not breaking the leasing contract. Breaking a lease doesn’t always end up well. With subleasing, you get to avoid the hassle that comes with breaking a lease contract.
- Monetary benefit. Subleasing is a great way to charge more than the rent. This way, you earn extra cash.
- Good rental history. A long rental history pretty much helps you to get quick approval on an apartment rental in the future.
Cons of Subleasing
- The subleasing tenant may be a wolf in sheep clothing. After all, all you know about the subleasing boils down to what’s on the paper. What if there’s more to the tenant’s history? Lots of what-ifs to worry about.
- The subleasing tenant would try to double-cross you and renew the leasing contract. If the tenant develops a unique flow with the landlord, double-crossing you is pretty much high.
- Eviction is usually served to folks who sublease their apartment, especially when subleasing is not allowed in the apartment complex.
Yes, there are cons, but the pros far outweigh the cons.
Moving on, here are six things to know about subletting.
6 Things You Should Know About Subletting
Make Sure You Are Allowed to Sublet
This should be pretty obvious, right?
Back in the days, owning two or more houses was not a thing. Therefore, it was quite rare to hear of terms like subleasing or subletting.
Well, things have changed — and subletting is now a thing.
Before moving forward with your plan, you’ve got to know if the lease agreement allows subleasing.
You should build a healthy rapport with your landlord and know if you are allowed to sublet your apartment.
Here’s the thing; laws governing subletting varies on both municipal and state levels.
To avoid any pitfall, you’ve got to review your rental and lease agreement thoroughly. This will, in turn, help you to identify anything about subletting or subleasing in the document.
Sometimes, landlords prefer only the original tenant to be living on the property. But if the state or municipal allows subletting, you’ve got to figure out the motive behind your landlord’s decision.
If it is unreasonable, then it would be best to take the landlord to court. However, if the motive is quite genuine, then you are better off leaving it that way.
One more thing…
If you are pretty sure you are allowed to sublet, get it in writing.
It’s Fast and Flexible
During subleasing, you are practically taking over the property from another real estate user who doesn’t need it.
It creates a dicey situation where the sandwich tenant (or sublessor) wants to sign a lease. If you get an approval from the landlord, you’d pretty much sign a sublease quickly. And if the sublessor is flexible, then you are in for a great time.
Take It or Leave It
A sublease is usually fast and cheap. Most times, the landlord will not offer many incentives — and you’d get little or no return on investment on any leasehold improvement.
In such cases, you’ve got to be flexible and adaptable.
On the flip side, these cases can be quite beneficial for folks who find spaces with a large budget for tenant improvement.
Check-In With Your Renter’s Insurance Company
The thing is, your landlord’s property insurance doesn’t cover your head. You can have a backup by having a renter’s insurance company.
With a renter’s insurance, you protect your property against theft, damages, or other forms of loss.
In a nutshell, the renter’s insurance protects the content of a tenant’s apartment.
Subleasing Laws Vary by State
Subleasing laws vary from state to state. Therefore, you’ve got to understand the laws governing subleasing in your state or municipality.
For instance, in New York City, tenants who stay in a building with more than four units would sublease their apartment regardless of the lease agreement.
Other states and municipalities may have different laws governing subleasing, and it’s your responsibility to know it.
You Don’t Have to Sublease
The availability of a space does not translate to subleasing the space. Sometimes, the landlord may not be willing to allow subleasing. Other times, the landlord would be willing to let the original tenant buy out from the lease.
Furthermore, you may have the opportunity of negotiating for space.
Negotiating for space doesn’t mean that you’d get the same discount as the original tenant. But you could get juicy benefits like long-term lease, free rent, and tenant improvement allowances