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Leases: The final misudnerstood frontier

Navigating mortgage pre-approvals, open houses, and agreements ofpurchase and sale can be challenging. However, the largest hurdle thata buyer may face may not have anything to do with financial ability orfinding a house. For many buyers, the last obstacle that they mustovercome is the lease for their apartment.

Navigating mortgage pre-approvals, open houses, and agreements of purchase and sale can be challenging. However, the largest hurdle that a buyer may face may not have anything to do with financial ability or finding a house. For many buyers, the last obstacle that they must overcome is the lease for their apartment.

While the standard residential lease may be one of the most common contracts signed, it appears to be one of the most misunderstood. Specifically, tenants seem to be unclear on the requirements for terminating the contract. Ultimately, the ability to end a tenancy will be contingent upon the original lease terms.

Tenants must give a landlord one week notice in the case of a week-to-week lease. A month-to-month lease requires one month notice of the intention to terminate.

The notice requirements for a year-to-year lease are often misunderstood. While the tenant must give three month's notice, the notice must be presented in relation to anniversary date of the lease. Tenants can’t simply give three month’s notice at any time during the term. Tenants are bound for 12 months and, if proper notice is not given, the year-to-year lease will automatically renew for an additional year.

In the case of a fixed term lease, tenants may not give notice during the term. The tenant is bound until the end of the specified period at which time the leases will end automatically. Only when the fixed term expires will the tenant’s obligation to the landlord be completed.

Subletting is an option for those who find a house before their lease is done. While landlords must first approve the new tenant, they may not arbitrarily deny a sublet. However, a sublet fee may apply and the original tenant may remain liable to the landlord.

 
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