Sublet vs Sublease | What’s the Difference?
Real estate as an industry sounds really complicated between long words, legalese, and making a big financial decision, it’s no surprise many people find it really daunting. Among them, you may have heard the terms sublet vs sublease and wondered: what exactly is the difference between subletting and subleasing? Let’s find out.
Sublet vs Sublease: Sounds similar, but very different
Subletting vs subleasing may sound very similar and many people even use them interchangeably, but it can actually be a really important distinction.
In simple terms:
When you sublease, you do not relinquish responsibility and still remain as the main tenant to the landlord. For example, you sublease to your friend–they turn out to be a terrible tenant and trash the apartment. YOU are responsible for the damage, since you are still the responsible party on the original lease agreement.
When you sublet, you’re actually transferring the original lease agreement from your name to whomever you’re subletting to. In the above example, if you sublet to your friend and they trash the place, the responsibility is on them, the new tenant, to pay for damages and repairs.
Get the difference? For a more in-depth look, let’s talk about how this can apply in different scenarios.
What is a sublet?
While behaviorally it may seem very similar, subletting is very different from subleasing. In a sublet, the original tenant relinquishes and transfers the entire lease agreement to another party. What this means is that the new tenant is now the person responsible for the maintenance and payment of utilities. The original tenant no longer has any responsibility.
In many cases, this means that a sublet is usually for a longer period of time, since the original lease agreement could be for more than a year.
What is a sublease?
A sublease can be defined as becoming a landlord. In other words, when you sublease a space, you become the landlord to the sublessee. You can sublease an entire unit, or a part of a unit. What this means is that you are responsible for the care, maintenance and overall upkeep of the space, just like your landlord would be in the original lease agreement. This is an important part to understand. Before you sublease to someone you don’t know, consider your responsibilities if that person ends up being irresponsible, or causes damage.
Similarly, because you are still the original tenant, you are responsible for the utilities and other charges (like internet).
In short, when you sublease your place, expect to retain responsibility for the maintenance of that space and also pay the utilities. Be sure to get approval from the landlord before subleasing. Do not confuse leases with estate ownership like fee simple vs leasehold, this is a separate topic about real property ownership.
Let’s compare subletting vs subleasing in detail:
1. Communication with the landlord
In a sublet, the lease agreement is transferred entirely to the new tenant. That means the communication with the landlord is also transferred to the new tenant. In a sublease, you would still be the point of contact with the landlord.
2. Paperwork and agreements
In both scenarios, there will be paperwork and different circumstances. In a sublet, all existing paperwork and agreements is entirely transferred to the new tenant, and there may be paperwork to be filed indicating the sublet. In a sublease, you should also draft up a sublease agreement between yourself and the sublessee. Your original lease agreement with the landlord also remains, so there is now an extra agreement between yourself and the sublessee.
3. How is Rent Paid?
In a sublet, the new tenant is entering into an agreement directly with the landlord, so rent is passed directly to the landlord. In a sublease, the sublessee pays the sublessor, and the sublessor (original tenant) must pass off the appropriate amount of rent to the landlord
4. Termination
In a sublet, it’s possible that the lease is terminated immediately and a new agreement is drafted up. It can also just retain its original term while being transferred to the new tenant. In a sublease, it usually terminates at the same time of the lease agreement and does not supersede the original lease.
5. Responsibility of the property and unit
In a sublet, the new tenant is taking over the entire lease agreement and is thus now the responsible party. In a sublease, the original tenant is still responsible since the original lease agreement still stands.
Knowing how much responsibility you have, if any, is very important when considering modifying or transferring a lease agreement. We hope this sheds some light on this topic.
Wait…what’s a sublessor vs sublessee then?
These are just words to describe the different parties (or individuals). A sublessor is the original tenant, leasing out a partial or entire unit. A sublessee is the new tenant taking over the lease agreement.
Should I sublet or sublease? Pros and Cons of subletting vs subleasing
You should sublet if:
You plan on leaving entirely, or for the long term. Consider transferring your lease to another party
You no longer want to be responsible for the property or unit
You should sublease if:
You are leaving for a short to medium term
You want to rent out a part of your space, or just a room
How to Sublet or Sublease Your Apartment
Check with your landlord and your lease agreement
Subleasing is always legal, but the landlord is allowed to have discretion over whether they allow their tenants to sublease or sublet. Always check with your landlord and your lease agreement.
Let the landlord know
If the lease agreement allows it, you should still check with the landlord and have a discussion with them.
Give your landlord details about why you’re subletting, who is coming in and for how long.
Look for applicants
It’s best practice to find a good tenant and you can use the standard process a landlord would use, just like how you applied. Try to obtain the following information for the new tenant:
A background check
A credit check
Proof of income
Recommendation letters, if applicable
Make an agreement
Lastly, make sure you write down the terms of your sublet or sublease on paper and have the new tenant sign. This makes your agreement in writing and is easier to enforce if conflict arises.
FAQs:
Is it OK to sublet?
It is legal to sublet, but your landlord is allowed to have final say. Make sure to review your lease agreement and talk to your landlord before subletting
What does no subletting mean?
If your lease agreement says no subletting, it means that your landlord does not permit you to additionally rent out part of, or all of your unit/property.
Is it sublet or sub rent?
If you’ve come across these two terms, they are generally referring to the same thing. A sublet is when you take over someone’s lease and become the tenant.
