This year, Virginia’s legislature took action and made large strides to protecting a residential tenant’s interest. In their last session the Virginia General Assembly passed a new set of laws which have repealed all of the old residential landlord tenant laws, and created some new very powerful tools for tenants. Arguably the most impactful new law is Virginia Code Section 55.1-1204(C) inferring a lease with certain terms, even when there is no physical written lease to speak of.
Effecitive October 1st, unless agreed to otherwise in writing – and even without a written lease, the law of Virginia will deemed the following to exist:
- The lease is for twelve months with no automatic renewal.
- Rent is to be paid in twelve monthly payments.
- Rent is due on the first of the month and late after the fifth of the month.
- A reasonable late fee may be charged.
- The security deposit can be no more than two months’ rent.
- Rent will be what was orally agreed on or the fair market value.
While there are other new laws that were passed to help the tenant, Virginia Code Section 55.1-1204(C) provides much to unpack. The first term, twelve months with no automatic renewal, provides a level of security previously missing to tenants with no written lease. Before this law, without a signed lease the tenancy was seen as a month to month tenancy, and so a thirty day notice to terminate was sufficient to end the tenancy by either the tenant or the landlord. Now tenants who do not have a written lease do not need to live in fear of receiving a termination letter forcing them out in thirty days. They can be safe in knowing that their first year in the location will be for an entire year, lest they fail to pay their rent.
The second and third terms are more to clarify basic procedure than to provide a right. Now there is no confusion on how many payments need to be made and when those payments must be made.
The fourth term, that a reasonable late fee may be charge, tags along with knowing when rent is due. If there is a set date when the rent is due, then it is possible to state when it is late. However whatever the late fee might be, it must be reasonable.
The fifth term protects tenants from the over ambitious landlord. Most landlords require some amount of money as a security deposit. Now even without a written lease the landlord cannot demand more than two month’s rent.
What the rent is that is owed is determined by the seventh and last term. The rent will be what was orally agreed on or the fair market value. If it is being based on the oral agreement, try to have some evidence as to what the amount is to be able to establish without a doubt that you only pay that much in rent. If no rent was agreed on then it will be the fair market value.
Having some definitive terms in place even when there is not a written lease is a boon to residential tenants. It provides a level of peace of mind that otherwise did not exist, and is important for both landlords and tenants to understand.
Note, this law only applies to residential leases. It does not apply to commercial agreements.
If you are a landlord or a tenant and have questions regarding a lease, breach of lease or the eviction process in Virginia, reach out to our landlord and tenant attorneys at (804) 423-1382 or info@wmmlegal.com. We are here to help.
