If you find that your tenant has a long-term guest or unofficial roommate, what can you do? If they’re honest about the situation and the new roommate isn’t causing harm to the property, you may add them to the current lease. Today, we’ll review how to add a tenant to an existing lease and why listing all occupants on a lease agreement is important.
Contents of This Article:
- Can You Add a Tenant to an Existing Lease?
- Why Do You Need to Add a Tenant to a Lease?
- Steps to Add a Tenant to an Existing Lease
- Amending the Current Lease vs. Creating a New One
- Handle Lease Agreement Changes With Ease
Can You Add a Tenant to an Existing Lease?
Yes, you can add a tenant to an existing lease. While it’s not the most simple process, it’s not uncommon for a tenant to request to add a roommate or partner to their lease agreement. However, a lease is a legally binding agreement, so it’s crucial to ensure each tenant is listed within the contract. That way, each person living in the property is held responsible for lease terms, and you reduce the risk of liability issues.
Whether you’re a do-it-yourself landlord or a Philadelphia property management company, it’s important to know how to change a lease agreement. First, we’ll discuss why you should add a new tenant to an existing lease and the steps to follow to amend your contract.
Why Do You Need to Add a Tenant to a Lease?
If your current tenant wants to add another person to their lease, it could be tempting to skip the paperwork and just allow them to have an unofficial roommate. However, unofficial tenants can be risky for you and your rental property. Here are some of the main reasons it’s crucial to add a new tenant to an existing lease.
- Legal Protection and Liability- Leases are legally binding agreements outlining the rights and responsibilities of both landlord and tenants. Additionally, all tenants listed on the lease are jointly and severally liable, which means each person is responsible for all lease obligations. Not listing each person on the lease can cause issues with lease rules and expectations.
- Proper Screening Process- If a current tenant requests to add a new tenant to their existing lease, you’ll want to screen the new tenant as normal. If you choose to neglect this step, you could end up with a tenant who doesn’t pay rent, damages the property, or has a history of criminal activity.
- Property Rules and Maintenance- When a tenant is recognized on the lease and agrees to uphold their end of the contract, they are more likely to take better care of the property. Being on the lease, they understand that they’re accountable for damages or maintenance issues.
- Insurance Purposes- It’s best to have each person living in the property listed on the lease for landlord insurance purposes. If something happens involving a non-listed roommate, it can affect liability or insurance coverage.
Steps to Add a Tenant to an Existing Lease
Adding a new tenant to an existing one isn’t much different than screening a new one. Most of the steps are the same, as you’ll want to require a new rental application, go through the normal screening process, and update the lease agreement with current details. That said, here are some of the steps to follow.
- Acquire a Written Request to Add a Tenant
- Check the Unit’s Occupancy Limit
- Require a Completed Rental Application
- Screen and Approve/Deny the New Tenant
- Review the Details With Each Tenant
Acquire a Written Request to Add a Tenant
If a tenant wants to add another person to their lease, it’s best to require that they submit a written request. That way, you know that they’re serious about their request and there’s documentation to prove it. Additionally, you’ll have the information you need regarding the roommate’s name, how long they plan on staying, and how they’ll split the rent.
Check the Unit’s Occupancy Limit
While you may have your own occupancy limits on properties, some restrictions are also legally set by statutes, codes, and ordinances. So, you’ll want to check on your state or local laws before allowing another tenant to stay in the property. That said, if adding another person to the lease puts you over the occupancy limit, you’ll have to deny the request to stay compliant. However, if the occupancy limit isn’t an issue, you may choose to approve the request to add a tenant to the existing lease.
Require a Completed Rental Application
Once you’ve made a decision and plan to accept a new tenant, you’ll want them to fill out a rental application, just as your current tenant did. So, give them a certain amount of time to fill it out and get it back to you so you can go through a proper tenant screening process.
Screen and Approve/Deny the New Tenant
Once you’ve received a completed rental application from the new roommate, you’ll want to screen them just as you would any potential tenant. That said, a thorough tenant screening process typically includes a credit, criminal, and eviction history check. You’ll also want to contact their references or previous landlords to better understand who they are as a renter. Although they’re moving into a property with a pre-established tenant and lease agreement, it’s important that you don’t cut corners during this process.
Once you’ve gone through the entire screening process, you can decide whether or not you’d like to add them to your current tenant’s lease. If you deny their application, you’ll want to send them and your current tenant a written explanation of your decision. On the other hand, if you choose to accept the tenant, send both parties a written notification that they’ve been approved.
Review the Details With Each Tenant
Next, it’s time to discuss the lease details with each tenant who will be living in the property. Set up a meeting with the tenants and explain the details of an additional security deposit and how you’ll amend the lease to apply to each person. Additionally, remind the tenants that they’re responsible for paying the full monthly rent, even if one roommate does not pay their portion. Then, you and your tenants can sign the new lease or the lease amendment, and you’ll be on your way!
Amending the Current Lease vs. Creating a New One
If your tenant wants to add a tenant to an existing lease, there are a few ways to go about it. For instance, you could amend the existing lease agreement or create a whole new one. Either way, it’s important to include all the details of each tenant, the rent amount, and the responsibilities of all parties. Here are the differences between each lease option.
Amending the Existing Lease
If you choose to amend your current lease agreement, you’ll want to add anything that may change with the new roommate added and review the tenancy terms for each roommate. For instance, you’ll want to include the following details.
- Lease terms for the new tenant
- Date of when the new tenant moves in and when they’ll move out
- The security deposit amount and when it’s due
- How much rent will cost and who’s responsible for paying
- Whether the agreement is individual or joint
- Consequences for missing rent payments
Additionally, you’ll want to cover situations specific to your rental unit, whether it’s parking or utilities. If anything with the original lease changes due to the additional tenant, it’s crucial to address it in the amended lease.
Creating a New Lease Agreement
Sometimes, you may create a whole new lease agreement instead of amending the current one. You may decide to use this route if several of the lease terms change with the addition of a new tenant. You may also decide to start with a new, full-term lease period when adding a new tenant.
That said, a new lease agreement can be helpful if you decide to increase the rent or change the security deposit amount or if any of the original lease terms change significantly. Once you’ve come up with new terms for the lease agreement, each tenant must agree, sign, and keep a copy for their records.
Handle Lease Agreement Changes With Ease
Have you ever had a current tenant request to add a tenant to an existing lease agreement? This situation isn’t that uncommon, especially as rent prices rise and people search for roommates to help keep renting affordable. That said, all tenants who live in the property must be listed on the lease, as it’s a legally binding contract.
Need More Advice? contact us today!
If you find yourself struggling to keep up with each tenant, lease agreement, and maintenance responsibility, it may be time to hire a property management team. A full-service team like Bay Property Management Group can help ensure your properties and lease agreements are up-to-date and legally compliant. Contact BMG today to learn more about our services throughout Baltimore, Philadelphia, Northern Virginia, and Washington, DC.
