Month-to-Month lease nearing a year

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Topic Author
sman09
Posts: 307
Joined: Fri Mar 23, 2018 12:02 am

Month-to-Month lease nearing a year

Post by sman09 »

Dear BH

After renting for about a decade now, we decided to actively look at buying a home. To force ourselves to actively do so we chose to be on a month-to-month lease since early this year. However, only over summer we got active and even made some offers which did not proceed further. Meanwhile some interruption due to health issues came up and we could not turn around to starting the process again.

We will very soon complete about an year being on this month-to-month lease and have paid a premium rent due to this. Would it be possible to request with the property manager/management team for any reduction in the rent for the coming month to adjust for the extra money we have paid over the nearly 1 year period and the fact we will very soon complete spending a whole year. We would appreciate any advice/suggestion in this regard on how we could go about getting any reduction.
Thank you very much.
123
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Re: Month-to-Month lease nearing a year

Post by 123 »

It's very unlikely the management company would afford you any benefit for being on a month-to-month for a year, that's not how it works. When you sign a lease for a period of time you agree to pay for the entire lease term, the property manager knows they will not have to find another tenant for the entire lease term. Month-to-month arrangements are more expensive because you have the right to conclude the rental arrangement much earlier. You pay a higher price for the right to vacate earlier. You had that right (and paid for that right) for the entire year, even though circumstances led you not to use it.

Lease practices can vary by locality. In my experience landlords typically lease for 1 year and then the arrangements revert to a month-to-month (this arrangement is generally stated in the lease language). You could always ask for a new 1 year lease but it would more likely be at your current monthly rate rather than a reduction. A new lease would protect you from rent increase for the period of the lease. Of course there may be unusual circumstances in your area that result in different practices.
The closest helping hand is at the end of your own arm.
Topic Author
sman09
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Re: Month-to-Month lease nearing a year

Post by sman09 »

Thank you very much for sharing this.

If we sign a yearly contract and if suppose find a home to purchase in about 3 months in to the lease, what is the typical action that follows - does the tenant pay for all the remaining months? or get a replacement and get away from the lease?

Thanks again!
AlohaJoe
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Re: Month-to-Month lease nearing a year

Post by AlohaJoe »

sman09 wrote: Wed Dec 04, 2019 1:19 am Thank you very much for sharing this.

If we sign a yearly contract and if suppose find a home to purchase in about 3 months in to the lease, what is the typical action that follows - does the tenant pay for all the remaining months? or get a replacement and get away from the lease?

Thanks again!
It depends on what your lease says and what your city laws are. Usually they say the same thing. No one can answer that question in the abstract since it depends.
CurlyDave
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Re: Month-to-Month lease nearing a year

Post by CurlyDave »

1. In most jurisdictions in the US a landlord is obligated to attempt to mitigate damages by finding a new tenant. The new tenant has to satisfy his normal rental criteria, but he can't just reject people out of hand.

2. The contract should be able to be paid in monthly installments, just as if you were still living there.

3. How much is the premium for month to month? When you compare a year's worth of this premium against the cost of a house it may well be worth the extra cost.
junior
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Re: Month-to-Month lease nearing a year

Post by junior »

sman09 wrote: Wed Dec 04, 2019 1:19 am Thank you very much for sharing this.

If we sign a yearly contract and if suppose find a home to purchase in about 3 months in to the lease, what is the typical action that follows - does the tenant pay for all the remaining months? or get a replacement and get away from the lease?

Thanks again!
My landlord originally had a contract that said I have to pay the entire lease if I break it early. I doubt this would hold up in court since in most states they would have the obligation to mitigate damages by getting a new tenant, but fighting that doesn't sound fun and nothing would prevent them from at least trying to bully me to pay the entire lease.

My new landlord contract instead says I pay a penalty if I break the lease early. The penalty varies from 1 to 3 months rent depending on how long I've rented there. It says I have to give 60 days notice to break the lease.

My landlord also offered the option to go to a 6 month lease instead of a year one, at a higher cost.

If you have a professional landlord with a portfolio of properties you may have less room to negotiate (or zero room) than if it's just someone renting their home. Though I have a friend who has successfully negotiated with a management company to avoid certain contract terms. Your mileage may vary. You can certainly request anything but they may tell you they won't do it.
Topic Author
sman09
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Joined: Fri Mar 23, 2018 12:02 am

Re: Month-to-Month lease nearing a year

Post by sman09 »

Thank you very much to @junior, @CurlyDave, @AlohaJoe for sharing your thoughts and inputs.
3. How much is the premium for month to month?
The monthly premium is $250.

So, in the event we decide to go with a shorter-term lease (say, 6 months) and find a home after a couple of months, we would continue to pay the monthly rent until the point the property manager finds a tenant for this apartment we are presently in?

The reason i sought help/inputs is we find the apartment management team a little hard to work with and so thought of getting some advice on how to approach them with such a request. We would soon complete three years at this place, of which the last one year has been a month-to-month.

Thanks again!
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dm200
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Re: Month-to-Month lease nearing a year

Post by dm200 »

I do not know what is "normal" these days.

Back, decades ago, when I was a renter - it was common that after the initial one year lease, it went to month-to-month - but with all other terms of the original lease still in effect. The landlord could (and usually did) increase the rent modestly every year or so.

I never paid such a "premium" when going month to month. Your monthly "premium" for month to month seems quite high to me.

"Everything is negotiable" - I suppose.
rich126
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Re: Month-to-Month lease nearing a year

Post by rich126 »

Not sure how this varies from state to state but being on a month to month lease can also backfire on you. I had a renter on one and I decided I wanted to move back in, legally I only had to give them 30 days to leave. I ended up giving them ~45 days. So you may end up paying more and having a lot less security.
BillyK
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Re: Month-to-Month lease nearing a year

Post by BillyK »

I work in a profession where I have been constantly moving and leasing for decades when not staying in hotels. Most major property management companies will agree to escape clauses if you ask. A typical escape clause may require a 60 day vacate notice with a standard one month penalty for breaking the lease. Then that way rather than paying the higher month to month lease rate, you get the one year lease rate. Often times they will agree to less than a year too such as 5, 7 or 10 month leases with higher rates as per the shorter duration, but still grant an escape clause which still may be better than paying month to month.
Topic Author
sman09
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Joined: Fri Mar 23, 2018 12:02 am

Re: Month-to-Month lease for more than a year

Post by sman09 »

Thank you everyone for your inputs! We did complete a year and a few months more and about to make the payment for this month's rent.

We are on a modest (single) income that affords comfortable simple living. We (I) have been contributing the maximum to my retirement account (thanks to all the wise counsel here that we received in 2018 prior to which we stopped contributing in hopes of having a higher take home income) but after living expenses save very little in the bank. Our hope was in owing a home we could improve this situation as the money we pay towards rent could be used to build equity.

Given the current situation in the economy and predictions made about the actual recession yet to set in, should we continue to wait for few more months in the hopes of finding home at a good price? and would that mean going in for a lease rather than continue with this month-to-month any more? We have saved up enough to put towards 20% down-payment and our credit scores are also very good. We would appreciate some guidance as it feels like the money we are spending each month could be put to better use.
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