Lease Assignment Agreement Information
A Lease Assignment Agreement is sometimes called:
- Lease Assignment
- Assignment of Lease
- Assignment Agreement
- Lease Transfer
What is a Lease Assignment Agreement?
If a tenant has to leave before their lease has expired, they may be permitted to assign their lease, which means to transfer their remaining rights and obligations to a new tenant. In this arrangement, the original tenant is known as the assignor, and the new tenant is called the assignee.
A Lease Assignment can be used for both residential and commercial properties.
Should I Sublet or Assign My Lease?
Both subletting and assignment involve finding a new tenant, but they have some key differences. It's important to review your Lease Agreement for rules about subleasing or assigning your lease, as well as discuss your options with your landlord.
An assignment involves the tenant transferring their lease interest to a new tenant using a Lease Assignment Agreement. The assignee takes the assignor's place in the landlord-tenant relationship, although the assignor may remain liable for damages and missed rent payments.
A sublease involves the tenant temporarily handing over the rights and obligations of a lease to a third party using a Sublease Agreement. Although the landlord typically isn't a party to the agreement, they can still hold the tenant responsible for the terms of the original lease.
Reasons to Assign a Lease
There are a variety of circumstances that may require a tenant to leave before their lease expires.
If you're renting residential property, you may wish to transfer your lease if you are relocating for work or personal reasons, looking to reduce living costs, increasing your living space, or purchasing a home.
If you're renting commercial property, you may assign your lease because of company relocation, expansion, downsizing, or seasonal closure.
What Should be Included in a Lease Assignment Agreement?
A copy of the master lease should be attached to the Lease Assignment Agreement or provided to the assignee.
The agreement should contain the following information:
- Type of lease: residential or commercial
- Property location
- Assignor, assignee, and landlord information
- Original lease term: start and end dates
- Start date of the lease transfer
- Details about the continuing liability of the assignor
- Lead paint disclosure
Is a Landlord's Consent Required for a Lease Assignment?
You should have the consent of your landlord when you assign a lease. The master lease may state whether a tenant is permitted to assign the lease and if consent is needed. However, if it does not, it is a good idea to consult with your landlord and obtain written consent to transfer the lease to a new tenant.
Continuing Liability of the Assignor
Your Lease Agreement may contain a clause about assignment and continuing liability. If it does not, the landlord usually decides whether the assignor will be responsible for damages or other breaches of the lease by the assignee.
The Lease Assignment Agreement should note whether the assignor is liable for the conduct of the assignee. If the assignor has been released from liability, the landlord can only seek compensation for damages to the property from the assignee.
In contrast, if the assignor remains liable under the original lease, then the landlord can seek recourse from both the assignee and assignor for damages and other lease violations.
If the landlord tries to collect payment from the assignor when the assignee is at fault, the Assignment Agreement stipulates that the assignor can seek recourse from the assignee.