What is Tenancy at Will and Is it Right for Your Rental PropertyTopic: Rental property
Tenancy at will is a type of informal rental agreement that is similar to a month to month agreement but there are no formal paperwork requirements and no written rental agreement. Compared to other types of tenancy, this type of verbal tenancy is far easier to set up and end.
Why would a landlord choose this type of tenancy? While signing a written lease agreement will bind a tenant to rent your property and ensure stable rent payments, there are times where a tenancy-at-will can be advantageous to you.
What are the Major Reasons for Having a Tenancy at Will?
Sometimes this type of agreement comes about simply because either the landlord or the tenant was too busy to make a formal lease agreement.
The landlord may be out of town when the tenant moves in. In a case like this, a verbal tenancy may be an excellent temporary solution. It also provides a quick way to end a tenancy in case the landlord is still deciding his next move with a rental property.
For example, the landlord is planning to execute a lease agreement with the tenant but hasn't fully settled on the terms or maybe he plans to sell the rental property and wants to be able to end the tenancy quickly when that happens. Another common situation is where you plan to occupy the rental property so that you can live it in yourself.
Let's say that you're not sure that a tenant is trustworthy, then it makes sense that you don't sign up a 5 year fixed term tenancy right away. You can start earning rental income immediately by agreeing to a tenancy at will instead.
You can always set up a lease agreement later if the tenant turns out to reliable and please, or ask you can ask him to vacate if he is disruptive or otherwise unsuitable.
Crucial Details of a Tenancy at Will and How You Can End it
This is an informal verbal agreement though the parties involved may sometimes write an informal note governing some of the terms of the tenancy. The note may include things like the rent amount, due date for rent payments or a no-pet policy.
In other cases, there is no written agreement at all. With this kind of tenancy, you can save yourself the time of drawing up lease agreements and the cost of an attorney review. Many landlords prefer to forego the paperwork for an at-will tenancy when renting to friends or family members.
While a written lease agreement can give you more stability and slash your vacancy rates, an at-will tenancy makes it a breeze to end the tenancy quickly when you need to. To end this tenancy, you will need to give your written notice to quit 30 days before the due date of the next rental payment.
As a landlord, you will need to decide which type of tenancy best suits your particular needs and circumstances. If you have problems doing so, you can always consider a tenancy at will.
About the Author
Teo Zhenjie has been showing landlords how to manage their tenants and rental property effectively on Propertydo http://www.propertydo.com/ - To learn more important tips on tenancy at will, visit his website today for step-by-step real estate guides, free resources and forms.