What Is a Sublet Fee and Who Is Responsible for Paying It?
Understand what a sublet fee is, why landlords charge it, and who is responsible for paying this cost in rental agreements.
A sublet fee is a charge encountered within rental agreements when a tenant seeks to sublease their property. This fee is associated with the administrative process that allows the original tenant to transfer temporary occupancy to a subtenant.
Understanding Sublet Fees
A sublet fee is an administrative charge levied by a landlord to manage the complexities of a sublease arrangement. This fee covers the resources and time landlords expend reviewing, approving, and formally documenting the sublease. Landlords impose these fees primarily to offset the costs associated with processing a new occupant.
The fee addresses several landlord concerns. It helps cover expenses for tasks such as conducting background and credit checks on potential subtenants. Landlords also spend administrative time amending the existing lease agreement or drafting new addendums. These fees also serve to deter frequent subletting, as transient occupancy can sometimes lead to increased wear and difficulty tracking individuals responsible for property conditions.
Components and Calculation
Sublet fees typically cover specific services and costs incurred by the landlord during the subleasing process. These often include the expense of running credit reports and criminal background checks on the prospective subtenant. Administrative time spent by property managers or legal teams on drafting or reviewing new lease addendums and processing associated paperwork also contributes to the fee. Any legal or accounting review required to ensure compliance with rental laws and internal policies is also a component.
These fees are most commonly calculated as a flat fee, ranging from approximately $50 to $500, depending on the property and location. Less frequently, a landlord might charge a percentage of one month’s rent. This fee is generally a one-time charge, assessed upon the approval and formalization of the sublease agreement. It is distinct from ongoing rental payments or security deposits.
Legal and Practical Considerations
The legality and permissible amounts of sublet fees can vary significantly depending on state and local jurisdictions. Many areas permit landlords to charge a reasonable sublet fee if explicitly stated in the lease. Some municipalities may have specific regulations or even prohibitions on such fees. Tenants should review their original lease agreement thoroughly for any clauses concerning subletting and associated fees.
The original lease agreement is the primary document governing the relationship between the landlord and the tenant, including any provisions for subletting. It will detail whether subletting is allowed, if landlord consent is required, and any fees involved. Typically, the original tenant is responsible for paying the sublet fee, as they are initiating the request to sublease. However, the original tenant may negotiate with the subtenant to cover part or all of this cost. The fee is usually collected either upon the submission of the sublease application for approval or upon the final approval of the subtenant, prior to their occupancy.