If you’re a landlord, you’re well aware of the importance of leases. They act as legal protection from everything that can (and will) go wrong during a rental term. As such, it is necessary for leases to be customized for each rental situation and updated as changes are made.
There are plenty of reasons why a lease agreement might need to be changed throughout a tenant’s time in your unit. One common reason is to account for changes in occupancy, which is often seen in student housing. Regardless of the situation, however, you definitely don’t want an adult who hasn’t signed a lease living in your property.
In order to minimize the risk of unscreened and unapproved “tenants” occupying your rental, you should consider using addenda to add new tenants to existing leases. You likely have a few questions about this process, so we’ve put together a step-by-step guide to help make your job a little easier.
Step 1: Acquire a Written Request
If a tenant comes to you requesting that they add another person to their lease, you should first require that they submit a written request. This provides you with assurance that they are serious about their request and aren’t just deciding on a whim to have their long-term guest become their roommate. Additionally, you have the details of their request, such as the name of the roommate and how they wish to split the rent, in writing right from the start.
Step 2: Check the Unit’s Occupancy Limit
Once you’ve received a written request, you should check the rental unit’s occupancy limits. Occupancy restrictions are legally set by statutes, codes, and ordinances.
If adding a tenant to the lease pushes you over the property’s occupancy limit, you must deny the tenant’s request. This is best done via an email or letter, in which you inform your tenant of your decision and reasoning.
If the occupancy limit is not an issue, you should proceed with the process.
Step 3: Obtain a Completed Rental Application
Your next step is to send your current tenant a copy of your official rental application form for their potential roommate to fill out and return to you by a specified date. Every tenant living in your rentals must fill out a rental application so that you can continue to the screening step.
Step 4: Screen and Approve/Deny the Tenant
Once you have received a completed rental application, you now have the necessary information to screen the potential tenant.
For this step, you should perform your typical screening process. Thorough screening typically includes credit, criminal, and eviction history checks, as well as contacting references and previous landlords. In order to ensure that the new tenant meets your housing requirements and expectations, it’s important not to cut corners.
After you’ve screened the applicant and reviewed their information, you should make your decision. If you decide to deny them housing, you should send them and your current tenant a letter or email explaining your decision. If you decide to accept the request, you should send both tenants a written notification and proceed to step 5.
Step 5: Update and Sign the Existing Lease Agreement
Now it’s time to talk about the lease. The best way to add a new tenant to an existing lease is through an occupancy addendum. This document should detail the terms of tenancy for the new roommate. Such details might include:
- Move-in and -out dates
- Security deposits
- Their cost of rent
- Whether they have and individual or joint rental agreement
- Any other necessary information
You should go over the terms of the agreement with all of the tenants living in the unit so there are no surprises in the future. Once this is complete, you and the tenants must all sign the addendum.
Update your Existing Lease Agreements
Hopefully you now have a better understanding of how to add tenants to existing leases and what that process entails. In order to mitigate risks, you must start with detailed rental agreements and update them as needed. The last thing you want is a legal disaster just because you assumed there wouldn’t be any issues.