When one hear the phrase “covenant,” he or she probably thinking, “Isn’t that another word for a roommate?” In a sense, the terms roommate and cotenant are somewhat interchangeable, but there are some important differences between the two. In addition, there is another word that should be put into the mix. This is sub-let.
A covenant is when two or more individuals rent a property together, as above. All are in contracts with the landlord. A tenant who has a contract to pay part or all of the term rent between a sub-tenant and a tenant. The sub-tenant has nothing to do with the landlord of the property. Not all landlords allow subletting, but some do allow for a fee. Main tenants still take no final responsibility for the rent and condition of the property. A roommate means sub-tenant, but with certain consent, the word can describe a joint tenant or sub-tenant. The word roommate doesn’t specifically describe who one is. Therefore, if individual needs to know for sure if it is two individuals, one needs to ask for details.
Specific languages may vary from lease to lease. Therefore, one must always include a threshold at which tenants can invoke joint tenancy clauses. For example, if a clause says, “…less than 65% (65%) of shopping center occupants have an event open and running…”. Therefore, the threshold, in this case, is open to the tenant and must be executed. Otherwise, the lessee can call the contract. Threshold calculations are also defined in some cases. Therefore, one can specify that 65% of the total tenant or 65% of the rentable area, etc. Finally, this clause must specify exactly the remedies available to the tenant in the event of a joint tenant threshold violation. In the conditions of the above example, two types are listed. First, the rent will be reduced to 4% of total tenant sales to not exceed the minimum rent under the lease agreement. Second, if the closed store does not reopen within 12 months, the tenant has the right to terminate the lease.
What if the Covenant does Not Pay Rent
If a cotenant stops paying rent, it can be a heavy burden for other tenants because they are responsible for the full rent. If the individual do not pay the rent in a timely or full amount, the other lessee is responsible for it unless it has signed another rental agreement. Cotenants generally sign both names on a single rental. In some respects, the co-renter acts like any other guarantor. If an individual stop paying the rent for one of them, the individual can request the cotenant to fulfill the rent. The terms of the lease must be maintained even if another cotenant drops the ball. The remaining cotenants can collect some redemption of lost money from other tenants, but legal action is required. The remaining cotenants are still responsible for paying the full amount.
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