What is a lease assignment and how does it work?
Assignment vs. Sublease
In an assignment, you transfer your entire interest in the lease to someone else. The assignee steps into your shoes and becomes the tenant, paying rent directly to the landlord and dealing with maintenance issues. In a sublease, you remain the primary tenant and are still responsible to the landlord, while the subtenant pays you.
Assignments are common when you need to move out permanently and want to avoid ongoing liability. Subleases are often used for temporary absences, like a summer internship. Your lease may prohibit or restrict both, so read it carefully.
How to Assign Your Lease
First, check your lease for an assignment clause. Many leases require the landlord's written consent, which cannot be unreasonably withheld in some states. You'll need to find a qualified replacement tenant, often subject to the same screening as you were. Once approved, you and the assignee sign an assignment agreement, and the landlord may require the assignee to sign a new lease or an assumption agreement.
Even after assignment, you might remain liable for rent if the assignee defaults, unless the landlord explicitly releases you. This is called a release. Get any release in writing. Some states allow landlords to hold you liable for the remainder of the lease term, so consider negotiating a release clause.
Common mistakes
- Confusing assignment with sublease—assignment transfers all liability, sublease does not.
- Assuming the landlord must approve any assignee without good reason; many leases give the landlord discretion.
- Forgetting to get a written release from the landlord, leaving you on the hook if the new tenant stops paying.
