Alabama - Tax Sale HELP!!!

[Syrica Brown]

Can someone please explain to me how a sublet (sub lease) works?  

[Denise Evans]

@Syrica Brown.  Larry Landlord rents a house to Tina Tenant. Tina has six months left on her lease (or whatever) and wants to move someplace else. Or, maybe she has a really cheap rent she is paying, and market rents are much higher.  Tina finds Sam Subtenant, who leases from Tina.  Maybe his rent is higher and Tina makes a profit. Maybe she charges him the same amount she is paying, and that lets her live someplace else.  Tina is the tenant of Larry.  Sam is the tenant of Tina.   Under Alabama law, Tina now has all the legal responsibilities a landlord has, including the responsibility to make repairs, etc.

I strongly discourage people from entering into subtenancy relationships.  It is far better if the landlord just lets Tina out of her lease, and accepts Sam as a new tenant.

Or, the landlord might let Tina out of her lease, accept Sam as a new tenant, but also require Tina to guarantee Sam's lease for the final six months (using my example) of Tina's lease term.

Either one of these accomplishes everybody's goals without getting into messy technicalities that come about with a sublease.

Most leases contain prohibitions against subleasing without the landlord's consent.

Many leases charge a one-time fee if the tenant subleases, or is let out of their lease and a new tenant accepted.That is because the situation causes extra work and risk for the landlord.  The fee is often 10% of the gross rent due for the balance of the term. If there were six months left on the lease, at $1,000 per month, the gross rent would be $6,000 and the fee would be $600.  Other landlords charge a flat fee, ranging from $50 to $500, depending on the market.  if the tenant (Tina in my example) is going to be charged a fee for being let out of their lease and a new tenant accepted, then the tenant should refuse to guarantee the new lease. After all, the landlord is getting extra money to help cover the new risk.  Of course, that is a matter of negotiation, and the landlord might not agree.

While it is not uncommon for a commercial tenant to have a below-market rental rate, it is very rare for residential tenants. That is because commercial leases are typically negotiated for much longer terms, often with renewal options.  But, most commercial leases also contain a clause saying that if the tenant subleases at a higher rental rate than it is paying, the landlord gets the profit.