Difference Between Leaseholders & Occupants

Many people don't own the house or apartment they live in. If you are renting or leasing from the landlord, your relationship is a legal one. Your rights and obligations depend partly on the terms of any agreement between you, and partly on the laws of the state, county or city where you live. If you've signed a lease, you are a leaseholder with a direct, legal relationship with the landlord.

​Read More:​ What Is the Landlord Tenant Law?

It's easy to divide the world into landlords and tenants, those who own real estate and those who pay money to live there. But not all tenants are created equal, and the type of tenant you are determines your legal rights and responsibilities.

A tenant is a person who lives on real property and pays rent to the owner of the property (the landlord). Most tenants sign a written rental agreement prepared by the landlord. If you sign a rental agreement that sets out a specific period of time you agree to live there, the agreement is called a lease. As a tenant signing a lease, you are a leaseholder.

If you live in the leased unit on your own, you are both a leaseholder and an occupant. But if you invite or allow other people to live in the apartment with you, they are also called occupants. They are not leaseholders, however, unless they also sign a lease with the landlord. This means that their legal relationship, if any, is not with the landlord, but with you.

If you, as a leaseholder, decide to leave the unit, you must typically give the landlord advance notice depending upon your state's lease laws and the terms of your written agreement. If you leave before the end of the term set out in the lease agreement, you may owe the landlord rent through the time you were contracted to stay. For example, if you had a one-year lease beginning on January 1, you are obligated to pay rent through December 31. If you decide to leave in September, you may owe rent through the end of the calendar year no matter what type of notice you give the landlord unless the landlord is able to find a new tenant, in which case you will only be responsible for the months in which the property was unoccupied.

On the other hand, the other occupants do not have a relationship with the landlord. They do not have to give the landlord notice if they leave, although they may have to give you notice depending on the agreement you may have with them. And if you decide that an occupant isn't working out for you, you can give her notice to leave without getting the landlord involved. If the other occupant has no agreement with you or the landlord, you have no real legal relationship, and you are not bound to any landlord/tenant law with respect to that occupant.

​Read More:​ What is the Penalty for Early Apartment Lease Termination?

The landlord can declare your lease at an end and evict you if you do not live up to the terms of your written agreement. Conversely, if the landlord does not live up to the terms, you may be able to get out of the deal. For example, if your landlord agreed in writing that the garage under the unit would be cleared out for your use by the time you moved in, and it wasn't, that may constitute a breach of the lease.

On the other hand, if the landlord doesn't clear out the garage, an occupant has no authority to hold the landlord accountable or to cancel the lease. Only a leaseholder could do that. Nor can an occupant demand that the landlord make other repairs or replace appliances that stop working.

​Read More:​ How to Break a Lease Legally: 5 Ways to Avoid Penalty