How to handle overlapping leases?
My short term tenant vacated 2 weeks early (on good terms). Which worked out well because the new long term tenants wanted extra time to move-in.
I can do an addendum to the new tenant's lease and charge them pro-rated rent for August, but how do I handle the existing tenant's lease? Technically they have the unit until August 31st. Do I do an addendum to their lease, and provide them all of the prorated rent from the next tenant? Is it fair to keep a portion of the prorated rent for the extra paperwork I'm doing?
Also, the short term tenant was paying a higher rate. So if I was truly prorating their August rent, I'd owe them money.
This works out well for everyone, but I just want to make sure I'm doing this legally. Thanks!
Hi Kathryn - I'm also a landlord in IL and am pretty sure state ordinance says something about prorating that rent back to the tenants who have moved out if you're able to get new tenants to move in during that time period. Of course, I think its specific to subleasing, which isn't exactly what you have here.
So option 1 is what you suggested, which is to do an addendum to the new tenants with the new move-in dates, prorating their rent. I'd also get some sort of an agreement in writing from the prior short-term tenants that they have vacated. If you have that, you should be OK, and don't necessarily have to prorate back their rent since they're not really subleasing.
Option 2 is where you'd prorate them both the appropriate amounts and pay in a bit because the short-term tenants are at a higher rate.
Option 1 is really on the table because you're saying they're on good terms and can just, in writing, confirm that they've vacated. Then you're fine.