A month-to-month lease agreement is a legal document that outlines a formal relationship between a real property owner and another party to rent residential property monthly.
What is a Month-to-Month Lease Agreement?
A month-to-month lease continues each month until either the landlord or tenant providesnotice to terminate the lease.
In most states, landlords and tenants can also form a month-to-month tenancy arrangement when:
- You and the tenant make a verbal agreement
- You and the tenant create a written contract
- You and the tenant continue to pay and accept rent after the expiration of a long-term lease
A month-to-month tenancy is a flexible arrangement that ends at any time and for any reason by either party as long as there is a proper notice of termination. Keep in mind that there are rules the parties must follow for breaking a lease early.
Month-to-month leases operate on a per-month basis unlike a long-term residential lease agreement, which typically lasts one year in length.
A month-to-month rental agreement affords landlords and tenants many benefits, but there are processes and laws (and pros and cons) you should know before entering into this type of short-term rental contract.
A month-to-month rental agreement will include all of the following:
- Premises: the location of the apartment, house, or room for rent
- Landlord: the owner or manager of the Premises
- Tenant: the person(s) agreeing to rent the Premises
- Monthly Rent: the amount the tenant owes the landlord each month
- Eviction Notice: the length of time in which the Landlord must provide advance notice to the Tenant before terminating the contract for non-payment of rent by the due date or violation of another lease term
Note: The free Month-to-Month Lease Agreement template we offer on this page will work for all states except California, Florida (this state has specific guidelines for periodic tenancies), and Washington, D.C.
Visit the California lease agreement, Florida lease agreement, and Washington, D.C. lease agreement pages for free templates that can be used for month-to-month rentals in those locations and review the applicable laws in those specific areas.
If you aren’t sure about leasing your rental property long-term, a month-to-month rental contract is a great choice. It allows you to earn rental income while giving you legal protection.
Notice Requirement for Termination of Month-to-Month Tenancies
For most states, a party must provide 30 days’ notice to end a month-to-month lease. For agreements with no written termination rules, 30 days notice is the standard.
Sometimes, you must give more than 30 days notice to a month-to-month tenant. Some states and cities require as few as seven days and as many as 90 days.
For example, some states require landlords to provide 60 days notice to tenants who have lived in the rental property for more than one year.
In addition, states like California require landlords to give tenants 90 days’ notice if the rent will increase by more than 10%.
There are also situations where landlords may provide less than 30 days notice to end a month-to-month rental agreement if the tenant is at fault and the landlord wants to start the eviction process. Some of these scenarios include:
- The tenant fails to pay rent or is in arrears
- A tenant causes significant damage to the property
- The tenant is in breach of the lease
Many month-to-month leases include rules regarding when notice is to be delivered (often the first of the month when the rent is due). A few states allow tenants to provide notification and move out in the middle of consecutive months.
In these scenarios, the tenant pays prorated rent for the month of the move.
How Month-to-Month Lease Agreements Work
Some states require the notice to be in hard copy form and either hand-delivered or mailed to the other party. You can refer to your state and local law as well as the lease agreement to determine if notifications sent by other forms, such as email or text messages are valid.
While you can usually terminate a month-to-month lease for any reason (or no reason), there are situations where landlords need reasonable cause to end the agreement.
For example, California law requires landlords to demonstrate “just cause” to terminate month-to-month tenancies when the tenant has occupied the premises for at least one year. Examples of “just cause” include the tenant:
- Refusing to pay rent
- Subletting (if not permitted in the lease)
- Committing illegal/criminal acts on the property
“Just cause” can also include reasons beyond the tenant’s fault. For example, you may want to end a month-to-month rental agreement to:
- Occupy the unit yourself
- Complete substantial renovations/remodeling
- Remove the property from the rental market
When you want to change the terms of a month-to-month lease (other than changes to rent), you generally must provide 30 days’ notice. Rent increases typically require between 30 and 90 days notice, depending on the state.
Month-to-Month Lease: Strengths and Weaknesses
There are advantages and disadvantages to a standard fixed-term lease (typically six months to one year) and a month-to-month lease – which one is right for you?
Month-to-Month Rental Agreements for Landlords
A month-to-month rental agreement may seem attractive for landlords looking for more flexibility. After all, you may wish to enter a “trial period” before deciding if a tenant is a good fit (can they pay rent and uphold lease terms?) and locking into a longer-term lease.
However, be aware that if you wish to end the lease, the notice period you must give your tenant to move out in your lease termination letter varies by state.
Most states require 30 days advance notice to the tenant and you’ll likely have to undergo the same eviction process as a fixed-term lease if the tenant fails to pay rent on time or violates another term in the lease agreement.
Simple rental agreements like a month-to-month agreement also allow landlords the freedom to choose whether or not to stay in the property management business altogether.
Because you are not bound to a long-term lease, it is easier to cut your losses in a shorter timeframe if it no longer makes financial sense to continue renting.
For month-to-month leases, most states require you to give tenants a notice of rent increase at least one month before the increase.
For long-term leases, you must wait until the lease period is over and provide your tenants with one to two months advance notice.
This means landlords can remain profitable faster than with a fixed term as rental situations shift in your area (more money means more possibilities for investing in your real estate business).
So, let’s recap the three main reasons why a month-to-month rental agreement may be the right choice for you:
- It lets you test out and find the perfect tenant
- It gives you the freedom to walk away
- It offers you financial flexibility and the benefit of quicker rent increases
Remember that many lease agreements have a Holdover Clause, which states the lease will continue as a month-to-month contract after the lease expiration date.
If this is in writing and a part of your signed original lease, you do not need a separate month-to-month rental agreement.ed to sign a separate month-to-month lease.
How to Write a Month-to-Month Rental Lease Agreement
Follow the steps below to write a month-to-month rental lease agreement.
Step 1 – Fill in Landlord and Tenant Information
1. Landlord. Provide the landlord’s full name or company name, depending on whether the landlord is an individual or an entity.
2. Tenant. Write the tenant’s full name or company name, depending on whether the tenant is an individual or an entity. If there is more than one tenant, enter the name of each additional tenant.
Step 2 – Enter Premises Details
3. Premises. Describe the rental. Specify the type of residential property being rented, such as an apartment or a house. You can write one in if none of the options provided describe the property type.
Fill in the number of bedrooms, bathrooms, and parking spaces (if parking is included with the property). Provide the property’s street (physical) address, including the apartment/unit number (if applicable), city, state, and zip code.
4. Storage. Specify whether the rental property includes any storage space. If yes, describe the storage space.
5. Furnishings. State whether the rental property will include any furnishings or not. If yes, provide a list of the furnishings included with the rental.
6. Additional Description. If any additional information would help describe the property, include it here.
Step 3 – Write Term Date
7. Term. Provide the start date of the lease.
Step 4 – Fill in Rent Information
8. Rent. Specify the dollar amount of the monthly rent payment, the day it is due (e.g., 5th day of the month), and the payment method.
9. Proration. State whether or not the rent for any length of less than one month will be prorated.
10. Bounced Check. Write the amount the landlord will charge for any bounced checks.
Step 5 – Check Guaranty Option
11. Guaranty. Specify whether or not a guarantor is required for the tenant under this lease. If yes, provide the guarantor’s full name and address.
Step 6 – Note Late Fee Option
12. Late Fee. State whether or not a late fee will be charged if the rent is not paid on time. If yes, specify the day of the month the rent will be considered late and the number of days for any grace period.
If a late fee is assessed, select whether the late fee will be a set dollar amount (including the amount) or a percentage amount.
Step 7 – Check Utilities
13. Utilities. Note if the landlord will be responsible for any utilities and if so, indicate which utilities. (Typically, the tenant is responsible for all utilities.)
Step 8 – Write Security Deposit Details
14. Security Deposit. Provide the dollar amount of the security deposit to be paid by the tenant to the landlord.
Enter the number of days after the end of this agreement that the landlord will return the security deposit (less any amounts under this section) to the tenant.
Specify whether the security deposit will be held in an interest-bearing account.
*Note that most states have laws regarding security deposits, the amount, where they’re saved, how they can be used, and when they must be returned to the tenant.
Step 9 – Fill in Use of Premises Information
15. Use. The property is to be used for residential purposes by the tenant and the tenant’s immediate family. In addition, the tenant is responsible for any damage caused to the property by their guests. Write any additional guest or visitor policy.
Step 10 – Write Condition of Premises
16. Condition. The tenant agrees to the current condition of the appliances, fixtures, and furnishings (if applicable) other than any exceptions to be added here.
Step 11 – Note Maintenance and Repairs Policies
17. Maintenance and Repairs. The tenant agrees to maintain the property and not remove any appliances, fixtures, and furnishings (if applicable). If the property has an outside area or grounds, then the tenant also agrees to maintain those.
Step 12 – Check Rules and Regulations Option
18. Rules and Regulations. Specify whether or not there are separate rules and regulations for the rental property. If there are, a sample “Exhibit A – Rules and Regulations” is included at the end of this agreement for your reference.
Step 13 – Choose Military Clause Option
19. Military Clause. State whether or not the tenant may terminate the lease agreement early for activity duty in the U.S. armed forces.
Step 14 – Check Smoking Option
20. Smoking. Note whether smoking is permitted or prohibited on the property.
Step 15 – Choose Pet Option
21. Pets. Provide whether or not tenants are allowed to keep pets on the property. If yes, specify the type of pet(s) and the amount of any pet deposit.
Step 16 – Check Inspection Checklist Option
22. Inspection Checklist. Specify whether or not the tenant must complete an Inspection Checklist at the time of move-in.
If yes, a sample “Exhibit B – Rental Inspection Checklist” is included at the end of this agreement.
Step 17 – Note Renter’s Insurance Option
23. Renter’s Insurance. State whether the tenant is required to obtain a renter’s insurance policy.
If yes, the policy must have at least $100,000 of personal liability coverage and the landlord must be named as an interested party or additional insured.
Step 18 – Choose Assignment and Subletting Option
24. Assignment and Subletting. Write whether or not the tenant can assign or sublease any part of the property.
If allowed, specify whether the tenant must obtain the landlord’s written consent to assign or sublease.
Step 19 – Fill in Default Details
25. Default. In the event of default (other than failure to pay rent), the landlord may give the tenant notice and the opportunity to correct the default.
Provide the number of days the tenant has to correct the default. If the default is the tenant’s failure to pay rent, specify the number of days after receipt of the landlord’s notice that the landlord can terminate this agreement.
*Note that most states have laws regarding the amount of notice a landlord must give a tenant for failure to pay rent or other violations of lease terms.
Step 20 – Check Lead Disclosure Option
26. Lead Disclosure. If the property was built before 1978, the landlord must disclose whether or not there are known lead-based paint and/or lead-based paint hazards on the property.
A “Disclosure of Information on Lead-Based Paint and/or Lead-Based Paint Hazards” is included at the end of this agreement for your reference.
Step 21 – Write Notice Information
27. Notices. All notices must be in writing. Enter the address where the notices should be sent to the landlord and tenant.
Step 22 – Enter Governing Law State
28. State Law. Fill in the state’s laws that will govern the construction of this agreement.
Step 23 – Choose Disputes Option
29. Disputes. If there is a dispute, specify whether the dispute will be resolved through court litigation, binding arbitration, mediation, or mediation then arbitration.
Step 24 – Note Miscellaneous Details
30. Miscellaneous. Provide for any other provisions not already included in this agreement.
Month-to-Month Rental Lease Agreement Sample
Below you can see what a month-to-month rental lease agreement typically looks like:
Month-to-Month Rental/Lease Agreement