Shared Lease

• The landlord might require that all the roommates sign the same lease as co-tenants. This arrangement generally favors the landlord, as the landlord treats the roommates as a single tenant. The benefit to the landlord is that she collects just one rent check each month instead of separate ones and holds just one security deposit in escrow. And, if the one or more co-tenants violate the lease, the landlord can hold all the roommates responsible. The challenge for each co-tenant is the possibility that one roommate's violation of the lease will cause them all to lose their home or be forced to resolve between themselves a situation best left to the offending roommate and the landlord.
  
  

Separate Leases

• Roommates can live in a shared residence under separate leases. Each roommate has her own lease with the landlord under this arrangement; each is individually responsible to the landlord for paying her rent and each pays her own security deposit. Separate leases favor the tenants. If one roommate violates the lease, the landlord evicts just that one roommate--the others are safe. In addition, each roommate pays rent with a separate check, so there's no concern over the possibility of one roommate paying on everyone's behalf and having to wait for reimbursement.
  
  

Sublet

• A shared housing rental agreement could be a subletting agreement, or a sublease, in which a tenant, or sub-lessor, rents his home to another tenant, called the sub-lessee, but stays on as the sub-lessee's roommate. The sub-lessor becomes the sub-lessee's landlord, in effect. The benefit to subletting is that the sub-lessor can evict the tenant, just as a landlord could. The downside is that the sub-lessor is still responsible for honoring the terms of his lease with his landlord. The sub-lessee is not a party to that landlord-and-sub-lessor lease and isn't bound by it. State laws vary, but a tenant usually has the right to sublet his home unless his lease specifically prohibits it.
  
  

Avoiding Problems

• Roommates should write an agreement that addresses common issues tenants face when they enter into a shared residency. Specify the amounts and due dates of monthly rent, utility bills, cable bills and other shared expenses each roommate is responsible for paying. Establish rules regarding overnight guests, cleaning, food shopping and consumption and noise. Nolo.com recommends including a clause in this agreement that says the roommates will seek mediation--that is, they'll work with an objective third party whose decision is binding--before breaking a lease or suing in court. A written roommates' agreement, even if not legally binding, makes clear each roommate's rights and responsibilities and holds each roommate accountable to her roommates.