When you think about a rental agreement, odds are you picture signing a year-long lease. While that rental scenario is the most common, it's far from being the only option out there. In particular, a tenancy at will is one type of rental arrangement that affords both the landlord and tenant with much more flexibility than a traditional lease.
If you're wondering what a tenancy-at-will arrangement is, we'll explain how this type of agreement works, the ways in which it is different from other types of tenancy, and the advantages and disadvantages of entering into one of these agreements. Armed with this knowledge, you should have a better idea of whether tenancy at will may be a good fit for you.
What is tenancy at will?
At its core, a tenancy at will is a type of month-to-month rental agreement. Rather than having a lease with a specified end date, this type of arrangement allows either the tenant or the landlord to terminate the arrangement at any time.
Usually, tenancy-at-will agreements are verbal. However, in some cases, there may be a written agreement that specifies other terms, such as the amount of rent that should be paid and when it is due. That said, in order for the arrangement to be considered a tenancy at will, any contract that's present cannot outline a defined rental period.
Sometimes also known as an "estate at will," this type of living arrangement is most commonly used after an existing lease term has expired. It allows the landlord and tenant to continue their relationship without being bound to a new lease. In some instances, however, it is possible to enter into a tenancy-at-will arrangement from the beginning, especially if there is already a relationship between both parties.
How is tenancy at will different from other types of tenancy?
In residential real estate rental, there are four main types of tenancy, one of which is tenancy at will. Below is a quick explanation of the other three types, so you can see they differ from tenancy at will.
Periodic tenancy is the most similar to tenancy at will. In a periodic-tenancy arrangement, the tenant agrees to rent the home for a certain period of time, usually either week to week or month to month. The details of the arrangement are written into a lease, yet there is no specific date outlined for when the arrangement will come to an end.
Estate for years
With an estate for years, there is a written lease. The lease specifies the rent amount, as well as a specific beginning and end date. In this case, there is no requirement for how much notice needs to be given for the tenant to vacate the property because it is assumed that he or she will be expected to move out at the end of the lease term.
Tenancy at sufferance
A tenancy at sufferance occurs when a tenant fails to move out after their lease expires. In this case, the tenant is still bound to the terms of the original lease and will have to move out when the landlord asks.
What are the advantages and disadvantages of a tenancy-at-will agreement?
As you might imagine, this type of living situation is not for everyone. If you're considering entering into this type of rental agreement, there are some distinct advantages and disadvantages you need to take into account before making any firm commitments. We've laid them out below for your consideration:
The advantages of a tenancy-at-will agreement
It offers plenty of flexibility
The biggest advantage of a tenancy-at-will agreement is that it offers both parties plenty of flexibility. Specifically, it affords both the landlord and the tenant the option to end the lease with relatively little notice.
Due to its flexible nature, this type of agreement is often most attractive to tenants who are in between more permanent living situations or who have to move around frequently for work. Similarly, it might be of use to a landlord who is ready to put the home on the market, but still would like to receive rental income while searching for a buyer.
There's typically less formality around moving
Put simply, moving under a formal lease agreement can be a hassle. There's usually a move-out inspection to worry about and a security deposit hanging in the balance. Since estate-at-will agreements are typically verbal, they usually don't get into that level of detail about procedure.
For that reason, these agreements can be beneficial for tenants who may not be able to afford some of those extra moving costs. They may also work well for more laid-back landlords who don't want to be bothered with these tasks.
Disadvantages of a tenancy-at-will agreement
There's less certainty
The flipside of allowing both parties to enjoy plenty of flexibility is that these rental agreements come with less certainty. As the tenant, under a tenancy-at-will agreement, you might wake up one day to find your landlord telling you that you have 30 days to find a new place to live. As the landlord, you could very well be left without a tenant on similarly short notice.
With that in mind, tenancy-at-will agreements do not usually end up being a good fit for those who do best with structure and consistency. Landlords who want to be able to count on a steady rent check and tenants who would like to be able to put down roots should strongly consider other forms of tenancy.
How are tenants protected under a tenancy at will?
Fortunately, even though there is no formal lease agreement associated with a tenancy-at-will rental agreement, as the tenant, you are afforded certain rights by law. Typically, these arrangements are governed by state and local regulations, so some of the specific time frames may vary. However, in general, you can expect to be granted the following:
- You have the right to the lawful and exclusive use of the rental unit.
- You have the right to live in a property that is free of any building or safety code violations.
- You have the right to be given notice before the landlord enters the property.
- You have the right to be given notice before the landlord wants you to move out.
What are a tenant's responsibilities under a tenancy at will?
Like tenants, landlords are also guaranteed certain protections, even if there is no formal rental agreement in place. These come in the form of tenant responsibilities. As a tenant in a estate-at-will arrangement, you will be held to certain expectations, including:
- You will be expected to pay your rent on time.
- You will be expected not to cause any excessive damage to the property beyond normal wear and tear.
- You will be expected to provide the landlord with notice before moving out.
Again, these agreements are typically governed by state and local regulations, so you'll want to check those to verify exactly how much notice you're required to give and whether there are any other requirements to which you may be bound.
Handling evictions under a tenancy at will
In most states, in order to evict a tenant without a lease, a landlord must provide 30 to 60 days' written notice that he or she would like the tenant to vacate the property. Typically, in most areas, a reason for eviction will need to be provided. However, that can vary, depending on where you live.
If the tenant does not adhere to his or her responsibilities as outlined under local governance -- For example, if the tenant has not been paying rent -- the time frame necessary for notice may be much shorter. In some cases, it can be as little as three to five days.
That said, keep in mind that in a tenancy-at-will situation, evicting a tenant for not adhering to his or her responsibilities can be more difficult than it would be under a transitional lease. Put simply, since these agreements are often verbal, it can be hard to prove that a certain rule or provision was put in place at all, let alone that the tenant agreed to adhere to it.
The bottom line
There's no denying that tenancy-at-will rental agreements aren't for everyone. However, when you're a tenant in need of a flexible living arrangement or a landlord looking for more flexibility with a rental property, tenancy at will can be much more beneficial to you than being beholden to a traditional lease. Still, before you agree to anything, you'll want to be sure to do your homework.
Use this post as a guide to what you can expect from tenancy-at-will situations. Then, take some time to look into your state and local laws. If you're the tenant, ask your landlord any specific questions you may have, so that you know exactly what will be expected of you. Above all, your goal should be to make sure that you feel comfortable with your rights and responsibilities before moving into any new living situation.