How to Sublet Your Apartment

Your lease agreement with your landlord is a binding document. It remains valid from the day you sign it to the day your lease expires. Every tenant is expected to remain within the terms of the agreement; any violations may be costly. The choice on whether to sublet or not depends on your lease agreement, among other factors.

Tenants choose to sublet their flats for varied reasons. You might be undergoing financial hardship, leaving the country, or just looking for company. Your reason for subletting notwithstanding, you should follow the right procedure to stay on the happy side of the law. Scrupulous attention to the rules will ensure you don't run into problems with your landlord and the authorities. This step by step guide will show you an easy process for preparing and subletting your house.

Verify That You Can Legally Sublet

The right to sublet, or the prohibition thereof, is usually stated in a lease agreement. If it's not, your next step is to look at local laws for guidance. Remember, local laws may override some terms of the lease contract in some localities. In the US for example, every state has different requirements for subletting. In states such as Kentucky, Iowa, and Massachusetts, the tenants can sublet without getting the landlord's approval, unless the lease says otherwise.

If you live in such a state, you can sublet your apartment even if the landlord protests, as long as the lease does not explicitly prohibit that behavior. Keep in mind that going directly against the wishes of your landlord might affect the renewal of your lease when it expires.

In some places, like New York, the tenant has a right to sublet even if the lease prohibits it. All you have to do in those spots is find a qualified tenant and have them sign a subletting agreement.

In some localities, though, subletting may attract stiff penalties. For instance, subletting without the landlord's approval in Arkansas can be punished with up to six months imprisonment. Being clear on the terms of sublet will help you stay safe and within the law.

If you will be subletting your flat for other purposes other than residential use, there is a completely different set of laws. Subletting or renting your home for events requires consent from the local authorities, which includes tax payments among other procedures.

a woman and a man talking at a door

Search For the Right Tenant

Being given the right to sublet does not make the process any easier. After verifying the legality of your actions, you have to undergo the daunting task of finding a tenant. There are several ways to find tenants. You can pass information around through word of mouth to friends to help you find a qualified tenant. You can also post in local dailies to find a person who is willing to live within your terms.

The best option involves online posting. You may use rental property listing options such as Airbnb, HomeAway, Homestay among other real estate listing sites. You may also post classified ads on free and paid classified websites such as Craigslist and Adlandpro among others. If you do not have money to spend on classifieds, use social media. Facebook groups offer the best platform for advertising local listings.

The process searching for the right tenant basically focuses on finding an individual who may need an apartment equal to what you have to offer. During the search process, you will do basic interviews over the phone. You should mainly ensure that the person looking to sublet is in a position to pay rent. It certainly helps if the individuals are also friendly or sociable, especially if you will be living under one roof.

Conduct Background Check On Tenants

Once you meet individuals who may be fit for your house, book an appointment for face to face interviews. Before you settle on the final tenant, you may wish to conduct background searches to ensure the person is not a threat to you or your neighbors.

Check through local justice system files to determine whether the prospective tenant holds a criminal record. You may ask for references such as friends and family members to ensure that the person you are about to bring in is generally reliable, and not dangerous.

Prepare the Sublet Agreement

After settling on the right candidate, you have to present them with an agreement. You can write it entirely yourself, or find templates online and adjust them to your needs. Make sure you have an agreement that explicitly specifies the terms of the lease, including start and end dates, number of people living under the sublet, and rules for guests, pets, noise, or anything else you want to cover.

You should expect tenants to ask questions regarding the terms of the sublet during interviews, and be ready with clear, well thought out answers. Clarify the terms regarding payment of utilities. If you will be living under the same roof, make sure you're clear on how the bills will be divided.

two hands exchanging money

Collect the Deposit

After ensuring the chosen tenant agrees to your terms, it is time to collect any deposits you wish to impose on the tenant—including good faith deposit and utility deposit. The good faith deposit is usually around 10% of the monthly rent. You must make sure your agreement is clear on the terms of payment—how often, how much, method of payment, late fees, etc.

Have your tenant pay a good faith deposit before they finalize the process and sign the lease. This will filter out applicants who aren't really serious. You may waste a lot of time going through the terms with a tenant who doesn't ultimately commit. Having a refundable deposit helps weed out those who may not be interested in the property.

Sign the Agreement

Once you are through with the formalities, such as going through the rules and explaining the details of the property, sign the agreement and have your new tenants sign it too. Make sure you keep a copy of a signed lease agreement. The tenants must also receive a copy of the same.

Set Up Rent Payments

Rent collection without proper procedures can be frustrating. As soon as you finalize the agreement, set up a rent payment process. You may agree to have the rent paid via bank or cash. Whichever system you agree on, make sure it's effective and works for both parties. Although not mandatory, it's advisable to have this process in writing as part of the sublet agreement.

The Bottom Line

Stick to local laws, make an agreement with your landlord, find the right tenant, prepare and sign a sublet agreement, and set up the rent collection process. All your agreements with landlords and tenants should be in writing to protect your interests in case of conflicts. If you ever make a verbal agreement, make sure you have witnesses around when you do.