What Is Subleasing and Subletting?

Moving into a rental property is a commitment. Regardless of the length of a person’s lease, that person is still committing to remaining on another party’s property for a set amount of time. While this is the nature of renting, there are still ways for tenants to move out of rental properties that no longer suit their needs. Some landlords, for example, offer subleasing opportunities to their tenants.

But what is subleasing? This process makes it easier for tenants to separate from a property, but it’s often conflated with other separatory procedures.

The Basics

First-time renters and new-to-market landlords may both find themselves wondering, what is subleasing? This process allows interested parties to break from a property without violating their contracts.

How does this work? To sublease a rental property, the tenant currently on that property’s lease must:

• Identify a third party interested in the property
• Present the third party to the property owner
• Arrange a lease addendum allowing the third party access to the rental property
• Retain control over rent payments and utility bills

Put another way, while subleasers may leave a rental unit and find another, they are still responsible for making timely rent and utility payments until their lease concludes. They may request reimbursement for these payments from their unit’s current tenant to compensate for their losses.

Limitations

While tenants dictate subleases, they are not always entitled to enact them. Property owners who negotiate a unit’s initial contract can dictate in the said contract whether or not their tenants can sublease their properties. These contracts place the original tenant in the role of a landlord. As such, even though a subleased apartment becomes the responsibility of its new tenant, the monthly delivery of rent and other lot-based utilities still falls to the original lessee.

The Process

There is no informal way to sublease a unit. If a tenant wants to pass off property to another party, they must do so while working with that unit’s management. Apartment complexes and other residential rental properties often have pre-made templates that the original lessee and new resident can fill out to establish liability for a lot. If you want to sublease commercial or otherwise private rental properties, you can work directly with interested parties to craft a contract specific to your situation.

Who Can Sublease a Unit?

Because subleasing requires a unit’s original tenant to control rent and utility payments, only that party may sublease their unit. Landlords may not sublease a tenant’s lot without their consent.

Subleasing Vs Subletting: What is the difference?

Many parties use the terms “sublease” and “sublet” interchangeably. While these terms both touch on the same topic一the releasing of a rental property一the process through which a tenant can take advantage of them differs.

Subleasing, as mentioned, sees a property’s original tenant retain control over a property’s bills until the end of their contract, even if another party currently lives in their unit.

Subletting, comparatively, removes the original tenant from the equation. Instead, tenants looking to sublet their lots can have a third party take over their lease in its entirety. This means that the new tenant will bear direct responsibility for a lot’s bills.

Which Agreement to Us

A tenant’s ability to sublease or sublet a rented lot should be addressed in that party’s lease. Tenants who aren’t able to sublease their lots can discuss their subletting opportunities with a property manager. Similarly, landlords who have barred their tenants from subletting can include bylaws permitting subleases.

In short, parties interested in separating from a rental property should examine their leases to determine their rights and actions in the matter.

Should You Sublease a Unit?

There are certain instances when it may be a good idea. If a tenant is no longer satisfied with their living conditions, for example, they may choose to sublease a lot so they can move somewhere that better suits their needs. In subleasing their lot, they ensure that their landlord receives rent on that unit without compromising or breaking their contract.

Landlords can also benefit from certain subleasing bylines in their initial contracts. Subleasing rights help landlords continue to make money on their units even if residents in the area are seasonal or unsatisfied. 

Final Thoughts

If you’re thinking about moving out of a rented lot or allowing your tenants more flexibility, ask yourself about the benefits of subleasing and how it can impact your rent collection.

Whether you’re subleasing, subletting, or managing an extensive list of tenants, collecting and paying rent doesn’t have to be a challenge. PayRent makes it easier than ever for tenants to pay their rent promptly. Landlords interested in streamlining their rent payment process for tenants can sign up for PayRent for free.