Subletting an apartment isn`t as simple as hanging out a sign and waiting for the perfect person to show up.
Anyone considering subletting (when a tenant rents to another tenant under the current lease) should be aware of the legal rights and obligations involved, whether it is a temporary sublet for a few months, or a permanent sublet, in which the new tenant likely will renew the lease when it expires, real estate management experts said.
One major problem-getting a landlord to go along with a tenant`s desire to sublet-was eliminated in Chicago in 1986, when an ordinance dealing with this was passed. The law states that ”a landlord has an obligation to accept a reasonable sublet . . . if it`s a building of four or more units and not owner-occupied,” said Barry Kahan, an attorney and real estate specialist. Some suburbs, such as Evanston, have similar ordinances.
One likely basis for a ”reasonable sublet” might be that the new tenant meets the standards set for other tenants of the building, Kahan said.
But a landlord can refuse a temporary sublet after which the regular tenant would return, Kahan said.
”Permanent sublets are more prevalent than temporary ones,” said Harold Rider, president of Harold D. Rider & Associates, a Chicago-based property management firm. ”There`s a continuous change in people`s lives,” he said.
”They get a new job in another location or get transferred out of state. They get married, get divorced, move to the suburbs. Sometimes roommates can`t get along with each other and they want to break the lease permanently.”
The temporary sublet, averaging three months, is less common because a tenant often can`t find a new tenant for such a short time, he said. Besides, some people are reluctant to temporarily sublet, especially when they`re leaving all their belongings, unless they know the person with whom they`re dealing.
The legal requirement for landlords to accept a reasonable sublet tenant is another factor in the prevalence of permanent sublets.
”Remember that regardless of whomever you end up subletting your apartment to, you are still the person ultimately responsible to the landlord” until your lease expires, Rider said.
Management experts offered the following advice on permanent and temporary subletting:
– Inform your landlord that you intend to permanently sublet or ask your landlord`s permission to temporarily sublet. If he agrees, ask his criteria for choosing the right person, because the landlord has the final say in who can sublet your apartment. By law, the landlord is not allowed to charge a fee for allowing the tenant to sublease.
– Find the tenant. Ask among people you know who are looking for a place to live. Ask them to ask their friends. Ask your management/landlord if he`s had any inquiries. If this fails, advertise in one major and one local newspaper. Put notices on bulletin boards, doors if permitted and in mailboxes of your building and neighboring buildings. Remember that the original tenant, when subleasing, must abide by the same fair housing laws as the owner.
– Check your prospective tenant`s lifestyle. Visit the tenant`s present residence to make sure he lives in a manner similar to yours. Be choosy.
– Check your prospective tenant`s references. Ask him for at least two and perhaps three business references, including the name and telephone number of his landlord, and call them. To check his credit, you will need to ask him to get a copy of his credit report from a credit bureau for you. This is necessary because you will not be able to run a credit check on him unless you are a memnber of the credit bureau. Credit bureaus, however, will furnish anyone a copy of his own credit rating, providing he has proper
identification.
– Discuss terms with a prospective tenant. In any sublet, decide on the monthly rent (preferably, it should equal what you pay), and the security deposit. The usual security deposit for both types of subletting is 1 to 1 1/2 months rent. You also should inform him of his responsiblities to your property, which include abiding by the terms of your original lease.
– Itemize your belongings in a temporary sublet. Make a list of everything in your apartment, noting if something is in less than perfect condition.
– Remove all your papers, irreplaceable goods and valuables-especially those things for which you have separate insurance riders-from the apartment. Store them in a safe deposit box or leave them with friends.
– Meet with your new tenant to sign a sublease agreement and the list of your belongings. Get a blank sublease agreement form from your landlord or at a stationery or office supply store. Make sure both parties fill out, sign and receive a copy of the form. Put everything that the two of you have discussed and agreed upon in writing and see that both of you sign it and that you both keep a copy.
– Give the new tenant a copy of your original lease, too, so he has a written record of his reponsibilities. Ask him to sign the list of
responsibilities with you and make sure that each of you has a copy, attached to the sublease agreement. Inform him that if anything is missing or broken, the cost for its replacement or repair will be deducted from his security deposit.
– Provide your landlord with the name and work telephone number of the new tenant, and the names and telephone numbers of two of his friends or family in case of emergency.
– Meet with the new tenant before he moves out and go over the list of your belongings together, looking for damaged and missing articles. If something is damaged or missing, charge him for it, deducting it from his security deposit. Don`t forget to return his security deposit-or the remainder-to him.
Tenants wishing to sublet for more than six months will be required to pay about 5 percent interest on the new tenant`s security deposit, Kahan said. But if the dwelling unit is in an owner-occupied building containing four units or less, he is not required to pay the interest.
In a permanent sublet, you may ask your landlord to write a sublease agreement for you instead of writing your own.
Since the landlord already knows how to do this, it`s easier for him than for the tenant. If possible, the tenant should ask him to write a whole new lease, which is preferable because it releases the current tenant from liability. The only fee the landlord may charge is for a credit check.
But many landlords are reluctant to write new leases because of the bookkeeping involved.
Those subletting in Chicago should be aware that the landlord has certain responsibilities, including a good-faith effort to find a new tenant if the original tenant moves prior to the end of the rental agreement.
But just because the landlord has a responsibility to try to rent doesn`t mean he will be successful. It`s to your advantage to try as well because if he can`t rerent your unit, you remain liable for all the rent under the original rental agreement as well as for advertising costs incurred in search of a replacement tenant.
Here are some tips from real estate agents to help make your apartment marketable:
– Have three months` consecutive utility bills available. In addition, if your apartment has an air conditioner or similar appliance using large amounts of electricity, show the new tenant relevant electric bills.
– Make a list of attractive apartment features, such as your extra security lock, the light, sunny interior and breezes that do away with the need for air conditioning. Don`t forget to mention bright outdoor
streetlights, nice neighbors, a cooperative maintenance man and a drug store nearby that`s open 24 hours a day or that delivers, if such pluses apply.
– Have your apartment as neat and clean as possible when showing it. Store excess furniture and objects out of sight. If you have a view, open your curtains to show it off. –
