MONTH-TO-MONTH LEASE: How It Works

Month to month lease

Lease agreements are typically valid for 12 months. However, there may be times when the standard 12-month lease agreement is insufficient to meet your requirements. You may be unable to meet the financial requirements of a standard lease or require housing for a shorter period of time.
If you are in the aforementioned situation, a month-to-month lease may be the better option for you. But what exactly is a month-to-month lease, and when should you choose it over a traditional lease?
Here’s everything you need to know about renting an apartment.

What is a Month-To-Month Lease?

A month-to-month lease is a rental agreement that lasts until amended or terminated by either the landlord or the tenant. Either party must provide notice in accordance with state law (see table below).
It is recommended that the termination notice be sent by Certified Mail with a return receipt by either party (USPS). After delivery, the receipt will be given to the sending party (as proof of receiving the termination).

Required Termination Periods

StateMinimum Termination RequiredStatute
Alabama30 days§ 35-9A-441
Alaska30 days§ 34.03.290(b)
Arizona30 days§ 33-1375
Arkansas30 days§ 18-17-704
California30 days for tenancy 1-year or less, 60 days for tenancy of more than 1-year§ 1946
ColoradoA tenancy for one year or longer, three months; A tenancy of six months or longer but less than a year, one month; A tenancy of one month or longer but less than six months, ten days; A tenancy of one week or longer but less than one month, or a tenancy at will, three days; A tenancy for less than one week, one day.§ 13-40-107
Connecticut3 days§ 47a-23
Delaware60 daysTitle 25 §  5106
Florida15 days§ 83.57
Georgia30 days§ 44-7-7
HawaiiThe landlord must give at least 45 days’ notice, the tenant must give at least 28 days’ notice.§ 521-71
Idaho30 days§ 55-208
Illinois30 days735 ILCS 5/9-207
Indiana30 days§ 32-31-1-1
Iowa30 days§ 562A.34
Kansas30 days§ 58-2570
Kentucky30 days§ 383.695
Louisiana10 daysCC 2728
Maine30 daysTitle 14 § 6002
Maryland60 days§ 8-402
Massachusetts30 days§ 186-15B
Michigan30 days§ 554.134
Minnesota30 days§ 504B.135
Mississippi30 days§ 89-8-19
Missouri30 days§ 441.060
Montana30 days§ 70-24-441
Nebraska30 days§ 76-1437(2)
Nevada30 daysNRS 40.251
New Hampshire30 days§ 540:11(2)
New Jersey30 days§ 2A:18-56
New Mexico30 days§ 47-8-37
New York30 days§ 232-b
North Carolina7 days§ 42-14
North Dakota30 days§ 47-16-07.2
Ohio30 days§ 5321.17
Oklahoma30 days§ 41-111
Oregon30 days§ 91.070
Pennsylvania15 days for tenancy 1-year or less, 30 days for tenancy of more than 1-year§ 250.501
Rhode Island30 days§ 34-18-37
South Carolina30 days§ 27-40-770
South DakotaThe landlord must give at least 30 days’ notice, the tenant must give at least 15 days’ notice.§ 43-32-13
Tennessee30 days§ 66-28-512
Texas30 days§ 91.001
Utah15 days§ 78B-6-802
Vermont60-day notice for tenancy 2 years and under and 90-day notice for tenancies of more than 2 years.§ 4467
Virginia30 days§ 55.1-1253(A)
Washington20 days§ 59.18.200
Washington D.C. 30 days§ 42–3505.54(a)
West Virginia30 days§ 37-6-5
Wisconsin28 days§ 704.19
WyomingNo minimumNo statute
Month-to-month Lease Agreement In Different States

How Does Month-to-Month Lease Work?

  • Step 1: Gather Tenant Credentials (Rental Application)
  • Step 2: Begin Negotiations
  • Step 3: Create a month-to-month lease.
  • Step 4: Signing the Lease
  • Step 5: Accepting Occupancy
  • Step 6: Cancelling a Month-to-Month Lease

Step 1 – Tenant Identification (Rental App)

When an individual expresses enough interest in the property that they wish to discuss renting it, the landlord should first conduct a background check using a Rental Application. This will allow the landlord to process and view the individual’s credit report, criminal background, and verify the character of the potential tenant with certain references. Landlords commonly charge anywhere from $18 to $75 per applicant to gauge interest in the property.
Verify the tenant’s credentials using the following references:

  • RentPrep.com Limited Background Check ($18.95)
  • Background Investigation ($35 per screening) – MySmartMove.com
  • Employment (Income) Verification – If the applicant has sufficient income to cover the rent but has poor credit, the landlord can confirm their employment status by contacting their employer.

Step 2: Start Negotiations

The landlord will be aware of the tenant’s creditworthiness at this point. In most cases, if the tenant has a high-paying job and good credit, they will be in a better bargaining position because they are more likely to pay their rent on time.
Tenants with bad credit may be less willing to negotiate because they pose a higher level of risk.

Security Deposit

It is suggested that the landlord always seek at least one (1) month’s rent upon tenancy. There will almost certainly be some damage to the property at the end of the period, and the landlord may deduct it from the amount when returning the money.
In the event that the landlord must evict a higher-risk tenant, the landlord should seek the equivalent of two (2) months’ rent or the State Maximum Limit. This sum will at the very least see the landlord through until the eviction is completed.

Step 3: Create a month-to-month lease.

After all negotiations are completed, the landlord and tenant should draft a lease. It is recommended that you use one of the State Specific Leases on this site because it will include all of the necessary clauses and disclosures for the property’s location.
Following the creation of the lease, the tenant should carefully review it to ensure that all negotiated items (e.g., monthly rent, security deposit, parking fees, pets, etc.) are written exactly as they were discussed.

Disclosure Forms

  • Lead-Based Paint Disclosure – Required by federal law for all tenants signing a lease if the property was built before 1978.
  • Move-in Checklist – Required in most states to resolve Security Deposit issues after the tenancy ends. Both parties must conduct an inspection before and after the tenancy to accurately detail any existing damage or repairs that are required.

Step 4: Signing the Lease

After both the landlord and the tenant have agreed to the terms of the lease, the parties should agree to meet to sign it.
When the parties meet, they should bring the following items:

Responsibilities of the Tenant

  • The first month’s rent
  • Security Deposit
  • Rent prorated amount: If they decide to move in before the first (1st) of the month
  • Parking Charge (if any)
  • Fee for Pets (if any)
  • Rent in Advance (if any)
  • Responsibilities of the Landlord
  • Allow access to the property, common areas, parking, mailboxes, and so on.
  • A copy of the executed lease

Step 5 – Accepting Occupancy

The tenant may now take possession of the property. If the tenant signed the lease but is unable to move in until the first (1st) of the month, they will have to wait unless they decide to pro-rate the rent and move in sooner. The tenant will not be subject to all of the lease’s terms and conditions until either party submits a notice to quit or vacate, effectively ending the rental agreement.

Step 6: Cancelling a Month-to-Month Lease

To terminate a month-to-month lease, the landlord must provide notice in the form of a termination letter. The notice period and the reason for termination should be included in the notice.

Why Would You Want a Monthly Lease?

While some people prefer the security of a fixed-term lease, those who require or desire flexibility should consider a month-to-month lease. Whether you need to relocate to a different city on short notice or look for a new job, the ability to leave your home without penalty is advantageous. If you just want to see where the wind takes you, this type of lease is ideal for you. A month-to-month lease also allows you to explore other neighborhoods or look for the perfect apartment until you find it.

Additionally, once your long-term lease expires, you may want to switch to a month-to-month lease. If you have been a good tenant, many landlords will agree to this. This lease transition would allow you to stay in your current home without making another year-long commitment.
What are the advantages and disadvantages of a month-to-month lease?
The benefits of a month-to-month lease may be more or less appealing to you depending on your personality and current circumstances. Here are the main advantages and disadvantages.

Advantages

  • Flexibility. A month-to-month lease gives you the freedom to move whenever you need or want to. Living without the constraints of a fixed-term lease makes it much easier to apply for new jobs, notice neighborhoods, and travel on the spur of the moment. You can also stay as long as you want as long as you and your landlord get along.
  • There are no penalties. When you decide to leave, there will be no penalties or fees associated with breaking a lease. If your rental property is in good condition, you will also receive your security deposit back.

Disadvantages

  • It is more expensive. Rent for a month-to-month property may be higher than rent for a comparable rental property with a fixed-term lease. This is due to the landlord’s assumption that the apartment will quickly become vacant.
  • Terms are subject to change. A month-to-month lease allows the landlord to change the terms of the agreement at any time, which means rent increases are both possible and likely. Other terms, such as access to amenities and utility prices, may also change.
  • The lease can be terminated by the landlord. While flexibility can be beneficial to the tenant, the landlord also has this option. You may be told that you must leave within 30 days, which can be stressful, unsettling, and difficult.

What Is the Difference Between a Month-to-Month Lease and a Lease Renewal?

Lease renewals are agreements signed with your current tenants to create a new lease agreement that typically lasts six months to a year. A lease renewal offer should be sent 90 days before the lease expires. In some cases, landlords and tenants will choose to renew the lease on a month-to-month basis rather than sign a fixed-term lease renewal.

How Does a Month-to-Month Lease Work With 30 Days’ Notice?

The 30-day notice period is the bare minimum for either party to provide notice that the month-to-month lease is coming to an end. Both you and your tenant can give more than 30 days’ notice to end the lease without incident.
This rule applies to more than just the end of a month-to-month lease. You are free to change the rent price (or any other rental term) as long as you give 30 days’ notice. Rent increase notices must be in writing and, in some states, delivered by certified mail. However, each state has its own set of laws that you must follow when making changes to a month-to-month rental lease agreement.

How to Locate Month-to-Month Rental Apartments in Your Area

While you can use ApartmentList’s filters to find a monthly option, landlords who advertise a flexible lease are not always available. Instead, look for clues such as a three to six-month lease, which indicates that the property is open to short-term options.
It will also help you establish a good relationship with your future landlord. Explain why you require a monthly rental and bring pay stubs and bank statements to demonstrate your ability to afford higher payments.

Are month-to-month leases available in apartments?

The length of month-to-month leases varies depending on the apartment complex. When short-term contracts are offered, you can usually request a monthly lease.

Is it expensive to rent an apartment on a month-to-month basis?

You will have to pay a premium for flexibility. Month-to-month leases are usually much more expensive than 12-month leases.

Can landlords raise the rent on monthly leases?

If you have a month-to-month lease, your landlord can raise your rent to reflect market rates with a 30-day notice.

Is it necessary to sign a month-to-month lease every month?

No, month-to-month leases automatically renew each month until one party terminates the lease legally.

Conclusion

If your future plans are uncertain, a month-to-month lease is a good option as long as you understand the drawbacks of this type of agreement. Prepare to pay a higher monthly rent and to be uncertain about the stability of your tenancy.
If you intend to stay in one city for a year or more, a standard lease is preferable. It is less expensive, more secure, and you will be protected by local renter laws.

References

0 Shares:
Leave a Reply

Your email address will not be published.

You May Also Like