Free Lease Assignment Agreement Template
A Lease Assignment Agreement or Assignment of Lease is a legally binding contract between a lessee (assignor) and a new tenant (assignee). It can be used for commercial or residential properties. Tenants use this document to pass their contract obligations to a third party if they need to exit a lease early. Such a situation may occur if a tenant must relocate or shut down a business before the lease ends.
The landlord (lessor) is typically not a party to this new contract. However, the assignee must meet the terms of the original lease. In specific cases, the landlord must sign a consent to allow a tenant to assign the lease, and some may want to vet the assignee before consenting.
The Lease Assignment Agreement outlines the terms of the agreement, assigns responsibilities for breaches, and documents each party’s acceptance.
Let’s discuss how this document works and how you can create yours.
Who Needs A Lease Assignment?
Lease assignments are used by commercial or residential tenants to “sell” a lease to another person. If they cannot assign the lease, the tenant must pay rent for a space they aren’t using until the agreed-upon period is complete. However, they may pass the lease if they find a willing tenant.
The new tenant is known legally as the assignee, and the original tenant is the assignor. Assigning a lease frees you to a great extent because the landlord knows someone else has taken your place.
Lease Assignment is different from subletting a premise. In a sublease, the tenant creates a different contract, which may include a different rent amount. However, the relationship between the tenant and landlord remains the same as in the signed lease. The tenant is responsible for collecting and remitting payment to the landlord and ensuring no breaches occur.
The Role of the Landlord in a Lease Assignment
The landlord rightly expects that a tenant stays responsible for their lease until it expires. However, because of constant changes, they may anticipate a tenant wanting to exit a lease early. Therefore, many lease agreements include provisions for possible assignments.
Even when a lease agreement does not have such a provision, the tenant can negotiate a deal with the landlord. Depending on your jurisdiction, the original lease sometimes contains language requiring that the landlord not unreasonably object to a lease assignment.
Still, some landlords may want to vet the new tenant like they did the first. If your landlord decides to screen the new tenant as they did with you, they may review the following information:
- Financial status: This is especially important to the landlord if you pass on rent responsibility to the new tenant. The landlord will want proof that the assignee will make on-time payments. Checking the new tenant’s finances works in your favor because most leases will hold you accountable for missed and late payments even after you assign the contract to another person.
- Restrictions on modifications and activity: The landlord may need to know beforehand if the new tenant intends to make significant alterations to the property. If they think the proposed changes are too extensive, they may deny you permission to assign the lease. The same applies to changes in use.
- Likelihood of compliance: To determine whether the assignee will comply with the lease, a landlord may require references by former landlords.
Many landlords avoid the extra work, preferring that you remain liable. Therefore, you need to choose a trustworthy tenant and ensure they understand their obligations and responsibilities regarding the lease.
Information to Include in a Lease Assignment Agreement
Ensure your lease assignment agreement contains all necessary information so that it releases you of as much responsibility as possible.
The Type of Lease
State whether the lease is for a commercial or residential property.
Personal Information
The lease should have the names, addresses, and other information about the assignor, assignee, and landlord.
Location
Include the physical address of the property to identify it. You may also include the size and other descriptions.
Length of the Assignment
The length of the assignment is the time left on the lease. Afterward, the new tenant may enter into a new contract with the landlord to continue using the premises. Include the effective and end dates of the assignment.
Liabilities
Outline your liabilities. Although you are exiting, your name stays on the original lease. Discuss with the assignee and the landlord to determine which liabilities you are keeping and how breaches will be resolved.
Date When You Signed the Original Lease
It’s essential to include the date the original lease took effect. Remember that the terms and conditions of that lease apply to the assignment.
Landlord’s Consent
Sometimes, the landlord’s permission to assign a lease is included as a section in the assignment agreement. However, many use a separate document to obtain the landlord’s consent and then attach it to the assignment agreement.
Signatures
Unless both parties sign the contract in agreement, it remains void.
You generally do not need to include the details of the lease agreement, but the new tenant needs a copy to determine whether they agree to its terms before signing the assignment.
Easy Legal Docs has created an adaptable Lease Assignment Agreement template to get you started. Landlords, tenants, and other businesses find our collection of legal documents versatile and easy to download for free when they need them.
Article written by
Senior Writer | Experienced Paralegal | 79 Articles
Dena Standley is an experienced paralegal based in Houston, Texas and has over a decade of experience working as a paralegal with trial lawyers and law firms. She is passionate about making legal processes more accessible and helping people understand and navigate complex legal matters with confidence.
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