Tenancy Agreement Lapsed: What You Need to Know
As a tenant or a landlord, it is essential to have a clear understanding of the terms and conditions stated in the tenancy agreement. A tenancy agreement is a legal document that outlines the rights and responsibilities of both parties involved in a rental property. However, what happens when the tenancy agreement lapses? Here`s what you need to know.
What is a Lapsed Tenancy Agreement?
When a tenancy agreement lapses, it means that the fixed-term period specified in the tenancy agreement has come to an end. The lapsed agreement means that the lease period has ended, and the tenancy is now on a month-to-month basis. This situation can be a bit confusing for both tenants and landlords, mainly if the parties involved did not have prior knowledge of the impending expiration of the tenancy agreement.
What Happens When a Tenancy Agreement Lapses?
When a tenancy agreement lapses, the tenancy continues as a periodic tenancy unless either party serves notice to terminate the agreement. For a tenant, this means that they can continue to live in the rental property on a month-to-month basis, and for a landlord, it means they can increase the rent or terminate the tenancy agreement after serving the required notice period.
Notice Periods for Termination
The notice period for termination of a tenancy agreement varies depending on the type of tenancy agreement and where you live. In general, a tenant must provide at least 30 days` notice to the landlord before moving out. Similarly, a landlord must serve a legal notice that complies with state laws and regulations before asking the tenant to vacate.
Renewing a Tenancy Agreement
If both parties wish to continue the tenancy agreement after it lapses, they can either renew it for a fixed term or continue with a rolling contract. A rolling contract is also known as a tenancy agreement that continues on a month-to-month basis.
The process of renewing a tenancy agreement involves negotiating new terms and agreeing on the new rental fees. Generally, tenants are expected to give notice before the end of the tenancy agreement if they plan to renew the tenancy agreement.
A tenancy agreement lapsed does not necessarily mean that the tenancy agreement has ended. It merely means that the fixed-term period has come to an end, and the tenancy has continued on a periodic basis. Both tenants and landlords must understand the legal implication of a lapsed tenancy agreement to avoid confusion and misunderstanding. Additionally, negotiating new terms and conditions before renewing the tenancy agreement is essential to ensure both parties` interests are well protected.