Restrictions on Tenants Without a Written Lease

Does a landlord really have a legal right to hold you responsible for paying a full year’s rent if you never signed a lease agreement? It always depends on the situation, but if you verbally agreed to a one year lease, you cannot leave before the year is up without risking the possibility of having to pay damages for breaking the lease, just as if it had been in writing.

You may have heard that a contract that has to do with real estate or a rental house, apartment, or condo unit has to be in writing or a court won't enforce it. That's true, in most cases. A contract to buy or sell a house, condo, or co-op unit, if it’s just a “handshake” sort of deal, means nothing at all under the legal rule called the Statute of Frauds unless and until the agreement is on paper, signed by both parties. However, a lease for no more than one year is an exception to that rule. So, this means that you can actually have a verbal lease that a court will enforce, and the agreement can be either month-to-month or for up to one full year.

The difference between a full year lease and one that runs month-to-month is exactly what you are concerned with here. If you have a month-to-month lease, you can end the lease, without penalty, by giving one full rent month’s notice to the landlord that you will be moving out. On the other hand, if you have a full year lease, you don't have that option. This tenant restriction works both ways, since the year lease also doesn't let your landlord raise the rent until the year is up, instead of being able to give you that same one month’s notice of a rent increase.

There is one small “out” that might be of some help: if you move out before the lease is up, the landlord cannot simply leave the place empty and expect you to pay all the rent for however many months are left on the lease. The landlord must make a reasonable attempt to find a new tenant, and any rent that a new tenant pays during the period of the remainder of your lease agreement is deducted from what you owe.

In this market, though, you cannot always count on a new tenant being available. Remember that if you have run into problems fulfilling your oral lease obligations, you may have legal rights. Consult an experienced landlord tenant attorney today to determine your rights and the best course of action for you.