3 Things To Consider Before Adding A Tenant To An Existing Lease

Picture this: you put up an online listing for your rental, and after a thorough tenant screening process, you find a high-quality tenant and sign a lease agreement.

However, a few months later, your new tenant suggests allowing them to bring in a roommate to help split the bills so they can continue to meet their monthly payments. It sounds like a great idea so what could go wrong?

Think twice before adding another tenant to an existing lease. As straightforward as it seems, many landlords often have to deal with financial and legal repercussions they made no arrangements to tackle.

Thus, allowing your current renter to bring in a roommate or sublet the rental could cost you more in the long run. Read on below to make a more informed decision before adding a tenant to an existing lease.

IMAGE: PEXELS

Complying With Local Laws When Adding A New Tenant

Research Local Laws

Ensure you comply with local laws and regulations before adding a new tenant to your lease agreement. Before making any definitive decisions, research your jurisdiction’s policies on occupancy limits and tenant rights.

For instance, if you’ve already reached the maximum capacity for your property type, bringing someone to live in the same house would be illegal.

Also, if the new tenant wants to modify the building or run a business from the apartment, you have to ensure they obtain the necessary permits.

Update The Lease Agreement

Create a formal amendment to your existing lease that includes the new tenant’s information.

After you’ve confirmed that bringing in a new renter doesn’t violate local rental laws, discuss these possible changes with your property manager before adding a tenant to an existing lease. The last thing you want is not being able to hold a new tenant liable for damages or rent because their name doesn’t appear in the lease.

As a result, this step is not only a legal necessity, it’s a form of protection for your business.

How Adding A Tenant Might Affect Shared Responsibilities?

Sharing Financial Responsibilities

Establish clear agreements on how to divide rent to avoid misleading assumptions. Most landlords tend to charge more when a tenant brings in another renter because of the increased risk of tenant damage and wear and tear on the facilities.

Despite that hike, rent is often cheaper for the existing tenant. However, it’s still crucial to outline how they’re expected to divide and pay the new fee.

Sharing Tenant Duties

Consider that your utility bill is bound to go up when you have an extra person or two living in your rental. As a result, if you pay for utilities like electricity, water, and internet, you may have to calculate the added cost of an additional occupant.

Likewise, tenants are responsible for minor repairs and maintenance like changing light bulbs or mowing the lawn. In that case, you should facilitate an open discussion on how to divide these duties so no one feels cheated.

You should also have a plan for how tenants will pay when there’s damage to the property. If it involves deducting from the security deposit, you should also agree on how to subtract from it and the formula for sharing the balance when the tenancy ends.

Maintain A Harmonious Living Environment For Your Tenants

Address Maintenance Issues Promptly

Maintain the peace in your rental property by addressing maintenance issues promptly. Despite an additional occupant facilitating the need for repairs due to added wear and tear, landlords must adhere to all local occupancy standards for rental housing.

In other words, you have to attend to tenant complaints quickly to ensure all your renters are comfortable and enjoy their rights to live in a safe and conducive environment.

Maintain Open Channels Of Communication

Foster a positive landlord-tenant relationship by maintaining open lines of communication with all renters. If you want to protect your rental business and avoid unnecessary tenant disputes, give all parties equal access to you.

In the long run, this transparency would ensure that no renter feels slighted when there’s a conflict or you are biased while meditating. The last thing you want is a complex eviction case because two or more of your tenants can’t get along together.

Also, being receptive to tenant feedback can improve satisfaction and increase the likelihood of a renewal.

Conclusion

Before adding a tenant to an existing lease, consider the legal and financial repercussions it could have on your real estate business. For starters, ensure that bringing in another person doesn’t violate local laws to avoid facing fines.

Also, remember to add the new tenant’s information to your modified lease agreement. While adding a new tenant means reducing the burden of rent and responsibilities for existing tenants, you still need to establish clear expectations.

It would be best to maintain open channels of communication and address maintenance issues promptly to avoid disputes.