As a landlord, one of the most challenging situations you may face is a tenant who refuses to leave your rental property after their lease has expired. While this can be an uncomfortable encounter, it's essential to understand your rights and how to best proceed in such cases.
In this article, you’ll learn how long a tenant can stay after the lease expires, how to send them notice that their tenancy will not be renewed or extended, and some tips for handling the situation without running afoul of landlord-tenant laws.
Dealing With Tenants Who Stay after the Lease Expires
A tenant who resides in a property after the lease’s expiration date is known as a holdover tenant.
If a tenant stays past the lease expiration, a landlord can continue to take monthly rent payments from the tenant, entering what is known as a “holdover tenancy.” If the landlord refuses to accept future rent payments from the renter, the renter will be considered a trespasser and must leave the premises or risk eviction.
Three different types of tenancy can occur when this happens: tenancy at will, periodic tenancy, and tenancy at sufferance.
Tenancy at Will
A tenancy at will is when the landlord permits the tenant to occupy the premises after the lease expires until the tenant or landlord terminates the agreement. There is usually no formal lease agreement; however, both parties must consent to the arrangement.
With an at-will tenancy, the landlord can ask the tenant to leave at any given moment. Similarly, the tenant can stop paying rent and leave at any time.
A periodic tenancy is when the tenant pays rent based on a verbal agreement until either the tenant or landlord chooses to terminate the lease. If neither party ends the periodic lease, then it will automatically renew.
Should the landlord or tenant wish to end the lease, they will usually be required to provide at least one month’s notice to the other party. According to the legal resource website nolo.com, notice periods can range from 3 days to 120 days, depending on the state where the rental property is located.
Tenancy at Sufferance
Tenancy at sufferance proves a greater challenge to a landlord because the tenant can stay on the property without permission and may not be paying rent. It can delay or complicate any eviction process, which must go through the courts.
If a landlord continues to accept rent from an unauthorized tenant, it could be perceived as implied consent for them to remain in the property, thus complicating matters even further.
Overall, landlords need to understand how long a tenant can stay after their lease expires and what legal options are available when dealing with holdover tenants. Being aware of your rights as a landlord can help ensure that you handle such situations effectively.
Understanding Landlord and Tenant Rights
Collecting rent from a holdover tenant can become complicated and messy without a formal agreement. Depending on your state laws, you may be making things worse by accepting payment from a tenant since you may be unable to evict them.
Knowing your rights as a landlord and your tenant’s rights ensures you’ll handle the process legally.
After the lease expires, the tenant loses their right to stay in the unit unless the landlord consents to a monthly agreement. To help landlords understand their rights and those of the tenant, the American Apartment Owners Association (AAOA) maintains an interactive map of landlord-tenant laws for each state.
While landlord and tenant’s rights may vary depending on the location, they usually include the following:
Landlord’s right to increase rent by an agreed-upon amount.
Landlord or tenant can end the lease with one month’s notice.
A tenant’s obligations will carry over throughout the monthly tenancy.
The tenant’s rate should not increase by more than the standard market rent.
What Can a Landlord Not Do?
Similar to how a landlord or tenant has certain rights, there are also things a landlord cannot legally do when dealing with a tenant who will not leave. These actions include:
Threatening or using force
Removing a tenant’s belongings
Shutting off utilities
Changing the locks
Harassing a tenant to move
If a landlord does any of the above, they could risk criminal charges. Depending on state laws, punishment may include fines, jail time, or both. The tenant can also seek civil damages in court if they believe their rights have been violated.
Therefore, know your tenant’s rights and always abide by them. It’s best to contact an experienced lawyer before taking any steps toward evicting a tenant who will not leave your property.
A landlord liability insurance policy may also help protect a property owner from being sued by a tenant. This coverage can potentially protect landlords from financial losses related to injury or damage occurring on the property’s premises.
This insurance also covers any expenses incurred due to legal action against the landlord for wrongful eviction, discrimination, failure to disclose known defects, or other property-related issues. This coverage can provide peace of mind that if something goes wrong, you will not be solely responsible for paying for damages resulting from your actions as the landlord.
Most lease agreements include a clause for automatic monthly renewal unless either landlord or tenant sends a written notice they will not renew the lease. In this case, the landlord will provide the tenant with a non-renewal letter stating that the current lease will not be renewed.
Typically, a non-renewal letter is sent 60 days before the lease's end date. While 60 days’ notice is standard for sending non-renewal letters, the precise amount of days required depends on the terms and conditions of the lease as well as the state where the property is located. Be sure to check your local laws and ordinances for specifics.
A lease extension occurs when the tenant stays in the space longer than the original lease states. A lease extension can be handled through a lease addendum that both parties sign, which would preserve the original lease terms.
An extension may also be applied automatically if the tenancy extends past the original tenancy dates. However, certain rules about required notice periods may change to reflect a month-to-month tenancy.
What to Do When a Tenant Refuses to Leave
When dealing with a holdover tenant, you have three main options: allow the tenant to stay, offer cash for keys, or evict them. The path you choose ultimately boils down to your relationship with the tenant.
Allow the Tenant to Stay
If you have a good relationship with your tenant, allowing them to stay after the lease expires may be an option. This approach is generally the least aggressive and can be beneficial if it helps maintain an amicable landlord-tenant relationship.
However, you’ll want to take steps to protect yourself from any potential legal risks. Make sure you have a written agreement outlining the terms of their continued tenancy, such as rent amount, length of stay, and any other changes in conditions. Both parties must sign off on it, ensuring there won't be any dispute about what each party agreed to in the future.
The advantages of this course of action are that it reduces conflict between you and your tenant while also avoiding the time and costs associated with eviction proceedings. The disadvantage is that it may leave you vulnerable if your tenant refuses to leave after your agreement expires.
Cash for Keys
Offering a cash-for-keys agreement is another option when dealing with holdover tenants. This option involves offering tenants money in exchange for them vacating the rental premises within an agreed-upon timeline. As long as the tenant agrees, this can be a quick solution to the situation without either party going through legal proceedings or court hearings.
Make sure both parties agree to the terms in writing and that both sign off on it. Before releasing the payment, ensure that all tenants have vacated the premises.
The benefits of this route are that it can be a relatively quick and easy solution for the landlord while still providing tenants some compensation for their inconvenience. The drawback is it may not be feasible if you don't have the cash available or the tenant refuses your offer.
If neither of those two options is suitable or possible, you may need to consider evicting the tenant. This process can be lengthy and involves filing a complaint with the court, serving the tenant with an eviction notice, and attending a hearing to prove you have good cause for evicting them.
Research your state’s laws and procedures before proceeding, as they may vary from place to place. This option tends to be more expensive in terms of time and money than offering cash for keys or allowing the tenant to stay. It can provide a legal resolution if all other options have failed. However, it can be stressful and costly for both parties involved.
No matter which path you choose, remember that communication is key. Make sure you’re always professional and respectful when dealing with your tenant, even if the circumstances become difficult. This way, you can ensure both parties experience a positive outcome.
How Can a Landlord Avoid Holdover Tenants?
The easiest and best way to avoid holdover tenants is through written communication, especially with the lease.
Add a clause listing exactly what the expectations are once the lease expires. Leases should also state how much notice renters need to give when renewing the lease and how much notice to give when not renewing it.
When a tenant’s lease is close to expiring, contact the tenant to find out whether they will be renewing their lease or leaving the property. Let the tenant know how and when you would like to receive notification of their decision. This avoids any chance of miscommunication and builds a transparent and open relationship.
Landlords need to stay informed of their lease agreements and when they expire. If a tenant stays past the expiration date without renewing or negotiating a new lease, they may become a holdover tenant, and the landlord could be liable for additional fees.
Review the laws in your area regarding tenancy agreements to ensure you are within regulations when dealing with tenants. By understanding how long a tenant can stay after a lease has expired, landlords can better protect themselves from potential legal issues and disputes.
Consider speaking with an attorney if you need assistance navigating your options or preparing for negotiations. Staying informed about your legal rights and responsibilities as a landlord is the key to maintaining prosperous and peaceful tenancies.