Probably everyone knows this but me, since I’ve never had an apartment. I have rented houses though. In the one I’m at now, I just had to sign a one-year contract. If I left earlier than that, they kept my $200 security deposit. Now that I’ve been here over a year, I’m just paying per month. So how does it typically work for apartments? I’ve heard of people signing a new lease once their old one expires. Is this necessary? Are they going to evict you if you don’t sign another one but are willing to pay? What’s the typical penalty for leaving early?
They keep the security deposit? Every place I’ve lived–and that’s in a number of states and a few countries–that’s illegal.
It wouldn’t be much of a deposit if you couldn’t keep it in the event of a breach of contract.
If you sign a lease, you are obligated to pay the monthly payments for the duration of that lease. There are ways to “break” a lease, but you shouldn’t count on that. State laws vary on leases and on month to month rentals, but generally, on a month to month rental, you are required to give 30 days notice. In most states the security deposit is exclusively for damages beyond normal wear and tear. Many landlords will require first and last months rent, plus the security deposit, so that you can’t move w/o paying the final months rent.
You shoud check your states landlord/tenant laws. In some places there are city and county landlord/tenant laws also.
The main advantage of a lease, for ther renter, is a guarantee that the rent won’t be raised for the period of the lease.
It all depends on where you live. In Canada, each province probably has its own Residential Tenancy law. I would think it would vary state by state as well for the USA. Then it would depend on the tenancy agreement that you signed; what clauses are in there, and such forth.
I work in a property management office. Our tenancy agreements are month-to-month for apartments only (with two buildings that require leases, just to be an exception). Condos, houses, and townhouses are on a one-year agreement. At the end of the agreement, the lease ends. We have the option of offering the tenant another fixed term, another term on a month-to-month basis, or enforcing the end date of the agreement.
Quite often, the tenancy agreement is a one-year fixed term, and then month-to-month thereafter. However, our office prefers fixed terms. We mail out a new tenancy agreement for the tenant to sign and return to us.
If a tenant breaks the lease, our tenancy agreement states that they must pay us $500 in liquidated damages, as well as remaining responsible for rent until the end of their agreement, or until it’s re-rented. When a tenant breaks his or her lease, letting us know they are leaving, we start advertising the vacancy and doing showings. It’s in our interest, along with the tenant’s, that the property is re-rented.
A $200 security deposit is remarkably low. Ours are one-half month’s rent, and if there is a pet, another half-month’s rent for a pet damage deposit. Houses run from $1100 to $2500 per month in our portfolio. The $1100 doesn’t get you a very nice house. (This is an expensive city to live in.)
I took a security and pet damage deposit the other day of $1595 together the other day.
Are they going to evict you if you don’t sign another one but are willing to pay?
We probably would. We can’t have tenants in place without a written, valid, current agreement in our files.
Security deposit is for rent? Every place I’ve been it’s for cleaning and damage repair. What I’ve dealt with uniformly for rent is “first and last months’.”
There’s that too. It depends on the landlord. In NYC, the large landlords are supposed to keep the security deposit in an escrow account, but smaller landlords often just say “gimme three months rent for first, last, and security.”
Every year in January, I get a cheque for the past year’s interest on the “last month’s rent”. As my rent increases, I have to top it up as well. I did not have a separate security or damage deposit. (Small building, Toronto)
My $200 deposit was actually more than half a month’s rent. It’s a trailer house i’m renting, I live in a really cheap city, and while I’m not in the ghetto, I’m not in the rich part either. I like it because it’s only 7 miles from work.
So how often is it that apartments (especially in the states) require a new lease every year? And what’s the point? I can understand requiring them to be there at least a year in some cases since moving people in can be a hassle, and requiring 30 days or so notice before leaving (what my place does) to try to get another tenant before it’s vacant, but why does it matter if you stay there exactly some integer number of years, instead of some years and some months? Is it just a scam?
I know some landlords are worried about filling their units at off times of the year. For example, here in Minneapolis, landlords dont’ like people moving out in winter. They’ll offer all sorts of incentives if you’re looking for an apartment in the winter. On my current lease, it says that I can move out before the year is up (with 60 days notice), but if I move out November-February, I’m responsible for rent until February.
Where I live (New South Wales, Australia), it’s like this:
You sign a lease for a specified initial period (usually 6 months or 12 months). Upon expiry of the lease, there are two options available to the landlord - 1) require you to sign a second lease, or 2) have what is known as an “ongoing agreement”.
ADVANTAGES OF A SECOND LEASE:
For the landlord - you can’t just up and leave without a very good reason ( that the landlord has broken the terms of the lease, usually) This guarantees rental income.
For the tenant - You can’t be summarily kicked out into the street.
DISADVANTAGES OF A SECOND LEASE:
Pretty much the opposite of the above:
For the landlord - if the tenant is a bum, you’re stuck with them.
For the tenant - if the landlord is a bum, you’re probably stuck with them, and if you just want to leave for personal reasons, it’s difficult.
SECURITY DEPOSIT (known as 'bond" here):
A landlord can’t claim this against unpaid rent. There is normally rent paid in advance at the start of the tenancy, and there are other avenues available to the landlord for getting rent out of you. In the real world though, if you leave a place with rent in arrears, the landlord will always find that the oven was dirty, the shower had mildew in it, the carpets needed shampooing, etc…
If you have a lease which stiplulates month-to-month after the end of the initial lease period (which you describe, notwithstanding the fact that you prefer not to do that), that same lease is the written agreement and remains valid through the month-to-month tenancy.
The way my lease works is that if I sign the renewal, it’s a yearly term. If I don’t sign it, it’s a monthly term and they charge me a $25 surcharge per month. This is all spelled out in the lease.
Security deposits are NOT rent. I work in property management, and I’ve had to send a letter spelling this out about a million times. Security deposits are for damage to the apartment upon moving out. We have to pay 3% annual interest, make a itemized list of damages, and return the balance within 30 days of the tenant leaving.
There are three options when the lease expires:
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Make a new lease.
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Make an addendum to the lease, stating the new rental amount, the new dates, and “all other items in the original lease are to remain the same.”
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Go on a month-to-month, with either tenant/landlord being able to cancel tenancy with thirty days notice.
On the web, look up the landlord/tenant laws for your state. Usually, you can find it on your state’s Attorney General’s site or through the local Consumer Affairs office.
The terms are written out in the contract, and they vary greatly from lease to lease. The landlord wants a good tenant to sign a new lease so they can lock them into paying for another 12 months. Generally if you leave early, unless there is an incredibly good reason (I’ve always seen military service as the sole excuse) you still owe the unpaid rent. That is why people are always trying to sublease their apartment to a new tenant if they have to move.
In Davis, California, the options at the end of my lease there (and practically everyone’s lease ended on August 31) were:
- Renew the lease (had to be done a few months before the lease expired).
- Move out.
Davis is a university town so that obviously had some play into the lawmaking process.
In general:
If you breach your contract by attempting to terminate the lease early, the lessor can sue to recover the monetary damages, which would be the remainder of the lease payments, unless you can show that the apartment was re-leased, or should have been re-leased.
Some contracts will have a provision allowing the damages from breach through early termination to be satisfied through forfeiture of some amount, such as the pre-paid last month’s rent cost, etc. Exactly what can be done is, as always with legal questions, up to the law of the jurisdiction in which you live.
Our tenancy agreements have four choices:
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Month to month
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Fixed term
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Roll over to month to month when fixed term ends
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At the end of the fixed term, the agreement ends, and the tenant must vacate
So, we usually mark off 2 and 4 and the property manager and tenant initial.
Basically right except for point #3. Yes, on a month-to-month, the tenant can move out with a 30 days notice. However, there could be restrictions on the landlord in terminating a month-to-month lease. Check out local tenancy laws. Essentially, the tenant is protected against unlawful evictions and can only be booted out for just cause.