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What is a month-to-month lease?

Just as it sounds, a month-to-month lease is a rental agreement that renews each month. Generally speaking, this type of lease allows either party to end the agreement anytime, as long as the agreed upon or legally required amount of notice is provided. Aside from the difference in term length, a month-to-month lease is similar to a fixed-term lease when it comes to outlining the rights and responsibilities of each party.

What are the pros and cons of a month-to-month lease?

When weighing the pros and cons of a month-to-month lease, here are a few topics to consider:

Flexible timing

  • A landlord can end a month-to-month lease at any time, which provides the opportunity to remove tenants when needed, but this may create housing instability for renters.
  • Tenants can move out at any time, which is helpful if their housing needs are more temporary, but this may create gaps in rental income for the landlord.

Rent variability

  • A landlord can increase rent more regularly, but unpredictable expenses may be hard for tenants to manage if they have a strict budget.
  • Landlords may opt to set month-to-month rent prices higher than they would for a longer-term rental period, but this may not be affordable for tenants. 

How many days' notice is required to terminate a month-to-month tenancy?

Given the flexibility and unspecified end date of a month-to-month lease, the party that wishes to end the relationship must provide some notice in advance. A 30- to 60-day notice is common. If there is no notice requirement in the contract, then state guidelines will apply. 

Whatever the parties agree to in the rental agreement is typically defensible as long as it doesn't violate state law. For instance, you can't agree to just four-days' notice if the state requires at least one week. To understand the laws that apply to your property, ask a lawyer.

Regardless of when you give notice, it is recommended that you put your communication in writing, either through a Landlord's Notice of Nonrenewal or a Tenant's Notice to Terminate Tenancy

When can a landlord raise the rent on a month-to-month rental?

As with state notice requirements for ending the agreement, many states limit how landlords may increase rent for month-to-month rentals. Some states require a notice period of 30 to 60 days, and others have no limitations. Talk to a lawyer to determine what restrictions might apply to you. If you do plan to raise the rent, a Rent Increase Letter can help you communicate that decision.

Get help before signing

Whether you're a landlord or a tenant, understanding the pros and cons of a month-to-month lease is crucial. It could be advantageous, but you should always be aware of the risks it may involve. Getting a complete picture of your rights and responsibilities prior to renting out a property as a landlord or finding housing as a tenant will help ensure that the landlord-tenant relationship goes smoothly. Find more resources for landlords and tenants, or ask a lawyer if you have additional legal questions about residential rentals.

This article contains general legal information and does not contain legal advice. Rocket Lawyer is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.

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