Many of our landlord clients come to us already aware that Michigan landlords and tenants can enter into what is called a month-to-month tenancy. You may be wondering what dictates that a tenancy is month to month. There are two common scenarios that result in a month-to-month tenancy.
The first scenario encompasses any lease relationship that is not in writing. This includes anyone you have allowed to move into one of your properties AND anyone one of your tenants has allowed to move in to one of your properties – whether you approved them or not.
A second common scenario involves a landlord-tenant relationship that started in written form with a term that has now expired or where the original term was only a one-month term. In such a situation, the original terms of the written lease carry forward as the governing rights and obligations of all parties involved. This latter scenario is the one you are perhaps most familiar with when thinking of month-to-month tenancy.
There are strategic advantages for landlords in choosing month-to-month relationships with their tenants. For example, shorter duration tenancies give the landlord more flexibility to change terms – including increases in rent, changes in utility responsibility, and changes in lawncare responsibility, just to name a few – more quickly. Another advantage to month-to-month tenancy is the flexibility to terminate an undesirable rental relationship more quickly as further explored in the following section.
Many landlords choose month-to-month rental relationships largely because they want to be able to terminate an undesirable rental relationship. For instance, what happens if you end up with a tenant that misses multiple payments, has poor behavior toward yourself, other tenants, and/or neighbors, keeps the property in a excessively dirty state, or otherwise damages the property.
In such instances, a time consuming and expensive landlord tenant trial may be necessary to determine whether adequate cause exists to terminate such a relationship in a longer-term lease arrangement. However, as a general rule, cause is not required to terminate a month-to-month tenancy; however -- PLEASE DO NOT STOP READING HERE – there are occasions where cause may be required.
For example, cause is likely required to terminate possession in a month-to-month tenancy when the tenant has a rent subsidy.There are tenant attorneys who are waiting to pounce on termination filings that do not list a cause for termination when the tenant has a rent subsidy. So, please do not give them that thread to pull.
Now that we have addressed whether cause is needed to terminate tenancy in a month-to-month rental relationship, we will focus on whether termination is the best strategy to accomplish your goals.
One of our first questions to our clients is whether their primary goal is to regain possession or to collect past due rent. We frequently take on new clients who have started a nonpayment action when their true goal was to regain possession of their property. Unfortunately, we then have to inform them that if the tenant pays, they get to stay in a nonpayment action and that right is an automatic legal result of that payment.
In summation, there are distinct advantages and disadvantages to establishing month-to-month rental relationships in Michigan. It is important to be fully aware of these positive and negative attributes to align your goals for your properties with the best form of tenancy.
Stout Law is here to help guide that decision making process at the outset and to help guide and execute the most efficient eviction procedures if a transition should be required.
Call us 24/7 at (616) 724-0346 or fill out the form below to receive a free and confidential initial consultation.