Tenant at Will: What It Is, Pros, Cons

Moving into a rental can be an exciting and daunting experience. One of the most important things when becoming a tenant is to learn what your rights are, and how to protect them; the same applies to landlords. A popular choice among agreements is a tenancy at will.

So what is a tenant at will? In this article, I’ll explain the different types of tenancy agreements, how they work, and answer some FAQs. Let’s get started!

What Is a Tenant at Will?

If your landlord allows you to live on their property without a lease, you’re one of many tenants at will. You can rent the place for an unlimited duration provided that you make payments on time; you may also leave at any time without having to break a contract.

This type of tenancy dictates that the property tenure can be terminated at any time by the owner or tenant. It is the most common type of agreement between a tenant and landlord as it offers great flexibility for both parties.

Since a tenancy at will agreement is governed by law, its terms vary from state to state. It does not require a formal contract or lease, and in most cases does not specify how long a tenant can stay on property or dictate the exchange of payment.

This type of agreement is often called a month-to-month tenancy or estate-at-will. Why? It typically requires tenants to pay rent once a month in advance.

How Does a Tenancy at Will Work?

A tenancy at will allows a tenant to occupy a property indefinitely. This means that a tenant can stay on the property as long as they want to and give immediate notice whenever they choose. Landlords have the same right: they can decide at any time to evict a tenant from their property.

In other words, if there isn’t a defined rental period, the agreement is considered a tenancy at will. That said, tenancy at-will arrangements are not entirely without rules; they just don’t have strict terms.

The flexibility that comes with this type of living arrangement derives from an oral agreement between the owner and tenant. The parties can sign a lease at will in which they outline landlord-tenant regulations in the agreement, such as an agreed rent and utility payment. Landlords and tenants can use the document to ensure that their rights and interests are protected; this contract specifies the nature of the arrangement, not its duration.

That being said, landlords and tenants rarely draw up formally written leases. Even if they do, your tenancy still can continue after the agreement expires.

This may also happen in cases if there is a different type of tenant agreement in place. Once it’s no longer legally valid, a lease automatically turns into a tenant at will agreement because the tenant is on the property without a formal lease.

To recap: tenancies at will are effective if there is an oral agreement between the landlord and tenant if a tenancy continues after the lease expires and there isn’t a new one to replace it; or if there is a written agreement that does not specify a timeline.

A tenancy at will offers flexibility for landlords and tenants but because there is no formal agreement; in most cases they require a degree of trust. It’s advisable to get a tenant at will lease since it ensures that parties play fair until any rental situations arise. It also allows both groups to protect their interests and rights, and make sure that all expenses will be covered.

Types of Tenancies

If you’re not familiar with the world of property leases and arrangements, it’s a good idea to learn about the types of tenancies that exist before opting for a tenancy at will agreement.

There are four main types of tenancies: periodic tenancies, fixed-term tenancies, tenancies at sufferance, and tenancies at will.

Fixed-term tenancy

A fixed-term tenancy is an agreement where there is a specified beginning and termination date; unlike tenancies at will, the agreement includes the length of the tenancy. Landlords seldom issue a notice to vacate, though they have the liberty to renew the lease with the tenant’s consent.

Periodic tenancy

If a landlord wants to avoid turning a fixed-term tenancy into a periodic tenancy, they need to give notice before the end of the fixed tenancy or add a clause to the agreement.

A periodic tenancy, much like a lease at will, does not have an end date and may come into effect once a fixed tenancy expires. This type of tenancy usually ends when the landlord gives written notice to vacate. In most cases, a periodic tenancy lease outlines when the landlord is required to issue a notice; both parties have to adhere to the clause.

Since tenancies at will and periodic tenancies do not have a termination date, it is crucial to carefully draft a tenancy at will. If drafted inaccurately, they will be considered periodic tenancies.

The difference between periodic tenancies, fixed tenancies, and tenancies at will is that an at will tenant needs the approval of the owner to end the contract prematurely. With periodic tenancy and fixed tenancy agreements, the landlord and the tenant need to agree in writing that terms are changing.

Tenancy at sufferance

Another type of tenancy is a tenancy at sufferance, where the tenant can legally live on the property after the lease expires. A tenant has to follow their original lease conditions like paying rent but can be asked to leave by the landlord at any time. If they fail to adhere to the conditions of the lease, the tenants can be evicted at any time without notice.

What sets a tenant at will agreement and a tenancy at sufferance apart is that in tenancies at will, the landlord simply lets the tenant occupy the property. In tenancies at sufferance, the tenant has overstayed their welcome, in a sense, but isn’t breaking the law unless they refuse to leave when asked.

Holdover tenants

Holdover tenants, or a tenant at sufferance, is someone who chooses to stay at a rented property after their agreement is over. If they continue to pay rent and the owner accepts payments, they can legally stay on the property.

If the landlord does not take payments from a holdover tenant, the renter is considered to be trespassing and will face eviction.

It’s important to note that in holdover tenancies, unlike a tenant at will, there has to be a fixed or periodic tenancy agreement first. Potential tenants can create a tenancy at-will contract with the landlord before agreeing to rent their property.

If you’re a holdover tenant, you’re entitled to receive a 30-day notice of termination only if you have continued to pay rent after the lease has expired. If you haven’t, the landlord can start a holdover proceeding, which treats you as a trespasser to evict you.

In most rental situations, tenancy agreements can change if both parties agree; changes need to be recorded in writing. It is possible to turn a fixed tenancy or a periodic tenancy arrangement into a tenancy at will lease and vice versa.

Advantages and Disadvantages for Landlords

Advantages and Disadvantages for Tenants

Key Takeaways

When and How Does a Tenancy at Will End?

A tenancy at will termination can occur at any time and triggered by either party; the key component to this type of tenancies is either party can terminate at will.

• Ask for possession of the property

If the owner wants to end the tenancy agreement, they need to ask for possession of the property. This will force the renter to vacate the premises, though they should be given a reasonable amount of time to remove their possessions and find another place.

• Leave the property

The tenant can terminate the agreement by simply leaving the property. Tenants will almost always give notice that they want to leave; tenancies only end once the tenant physically leaves the property.

• Enter a fixed-term tenancy agreement

Another way to accomplish tenancy at will termination is to enter a fixed tenancy agreement, which requires both parties to sign a lease. The agreement automatically ends if one of the parties dies.

• Know your rights

Tenancies at will are governed by state law and while they’re usually easy to sever, some states might be more nit-picky than others. It’s best to familiarize yourself with your rights before entering this type of agreement.

Conclusion

What is a tenancy at will without flexibility?

A tenancy at will allows landlords and tenants to avoid setting a termination date; they can opt out of the agreement any time with little notice or paperwork. No wonder it’s the most popular form of tenancy in the U.S!

Still, a tenancy at will lacks stability and is best suited for tenants who move around or landlords that don’t want to deal with formalities.