I am thinking about breaking my lease a few months early to pursue a great deal on a home.
I reviewed my lease paperwork and it says:
Early Termination of Occupancy - The tenant shall not be released from liability for rent and other charges due under this lease unless the Landlord agrees in writing to release the tenant from such liablity.
I called the homeowner and he hasnt called me back yet, so I waned to know if he doesnt allow me to break the lease and I break it, by law, is he only allowed to keep the security deposit or is he allowed to go after more damages?
Normally, he is entitled to collect the remaining months of rent…so if your rent is $700 and there’s 3 more months left, he is entitled to and can sue for the $2,100 remaining.
But, he would have to go through the whole court thing…maybe you know of another person that would like the place and that would ease his heartburn with you leaving early…?
If it does go to court, a judge will normally look to see what the actual damages to the landlord were…if he was able to rent it right away, then he might not get anything…or if he were not, the judge could enforce the terms of the contract and require you to pay the remaining balance. Usually, the judge will make the landlord show that he is actively marketing the property.
Hopefully, the landlord has a heart and will just let you go. My lease specifically says that we as landlords encourage homeownership and if you provide us with 30 days notice and a valid sales contract (showing where you are buying your own place), we will break the lease for you.
Wow that’s really nice of you to let people off like that.
Basically you’re on the hook for the rest of the lease unless the landlord fills it with someone else. His damages would include advertisment and other expenses associated with an early move out like milege and showings and the like. Also say you rented it for $800 and he can only find someone else for $700, you could also be responsible for the difference in rent until your lease ran out. If you find someone else to do a sublease, usually the laws say something like they have to be acceptable to the landlord. That is they still have a right to screen the tenant.
Your best bet is to tell the landlord as early as possible so that he has plenty of time to show the apartment and you’ve already done that. The other thing of course is that you can delay the closing a little so it’d give him a little more time, but I wouldn’t worry about that too much as you might also lose out on a great interest rate, they’ve been coming down a lot lately and they may come down a little in the next month or go up a little.
I was in the same situation a year or so ago. I had to break the lease and ended up getting nailed for the 3 months I had left on it. Plus I lost my deposit. I paid up, as the management company was sending me to collections. I was in the middle of buying my first investment property and didn’t want a black mark on my credit.
It sucked, and paying up hurt, but that was the agreement I signed.
I am on the opposite side of the coin. I am a landlord, and just got word today that my tenant ( a very good one) just received a promotion, and has to move out by OCT 24, which is 5 months early! It’s not about “having a heart”, it is a business situation. I plan on tenants honoring their lease, and begin thinking 2 or 3 months out if I want to renew or find another tenant or put it on the market. I am not in a good position to suddenly have a vacancy that could be an unknown time frame. So, I was thinking of a win-win. Since her company (major corporation) is making her move so quickly, shouldn’t they buy her out of the lease, or pay the rent until I fill it? Or maybe if they cover the rent I could put it on the market while the rent is still coming in. This way the tenant doesn’t get hurt personally, nor do I. I think the corporation should help out their employee if they want to invest in promoting them, right?
Thanks!
As a landlord, you stated it accurately that it’s a ‘business situation.’ My question is: what about the corporation you are suggesting should pay your tenant’s rent? It would be the last source, I believe, that you should look to. That would be a win-win-lose situation. They are in business like the rest of us . . . their prospective employees need to make their own decisions (take the job and leave the rental or keep the rental and lose the job) and be responsible for their contractual obligations. It is not the responsibility of government or a ‘corporation’ or other employer to ‘help out’ with their employees’ responsibilities. If the tenant were inclined, she could have negotiated that as part of her package, but that would be a business decision between her and her employer at that point.
One of the biggest risks we as landlords take in renting out units is that the tenant will, for whatever reason, need or want to leave early. They need to be held to their contractual obligation no matter what. Landlords as well need to be prepared to hold them to the lease paperwork in order to capture the income they are owed. That is the landlord’s job. It’s not often easy and sometimes takes great courage.
Property management, especially residential, is a tough business. That is why there are contracts and landlord/tenant laws to govern how landlords and tenants work together. Tenants are very good at finding the soft spot in their landlord . . . that is why it is imperative that the relationship is conducted in a businesslike manner with everyone knowing and fulfilling their respective obligations.
Cate,
Thank you so much for your thoughtful reply. I wholeheartedly agree with you, I was just thinking of a way to not burden the tenant or myself. I guess what I don’t know is, if the tenant is pursuing the promotion or the company recruited her. In any event, I will approach my tenant with the facts that she does need to fulfill her obligation of the remaining 5 months. Do I ask that up front to release her from the contract or let her pay until I replace tenant? I think up front is best, but do I have that right in Florida? I will check the lease again…thanks for your help!
You sure do have that right in Florida. That’s the state I was living in when I had to break my lease (as stated in a previous post.) The management company I was in contract with made no bones about demanding my payment at once. But you can be a little less evil than they were and at least notify your tenant of your intent rather than send her to collections and threaten lawsuits from the get go (as these sharks did to me).
I can’t help but reply to your comments. It’s important to remember that a management company is hired by the owner of the property, with whom a tenant enters into a contractual obligation to pay rent in return for the limited use and enjoyment of the premises for a period of time. Additionally, the lease contract, which sets forth remedies, is the notice of the owner’s intent to pursue collections should the lease be broken by the tenant.
Like any other business relationship, if a contract is broken, there are ramifications incumbant upon the parties. For the management company to perform their duties in accordance with their contract with the owner, it is unfair and disrespectful to refer to them as ‘evil’ or ‘sharks’. Your attitude exemplifies exactly what we, as property owners and managers, in doing our job must deal with.
At the same time, I do agree that some management companies need to work on their initial interactions with tenants to make sure the tenant is fully informed of all ramifications and requirements of the contractual relationship. It is at the commencement that the future relationship is decided.
Refla, to answer your question, the laws in your state and the lease contract will dictate what your rights are.
Cate, with all due respect, you don’t know enough about my previous situation to say I’m being unfair or disrepectful. As this wasn’t my post, I didn’t want to hijack it and go into detail about how this managment company conducted business. I know the law, and I know about ethical business standards. And believe me, if you’d ever dealt with them, you wouldn’t be lecturing me about fairness and respect.
Thanks for your response. I was just pointing out that a lot of people read these forums and perhaps you might have pointed out the difference between ethical management companies and the one you dealt with. Although I’m not clear on how demanding payment in accordance with the ‘agreement you signed’ (as you stated in your post of September 29 at 3:09 p.m.) would make them unethical.
I was not lecturing you . . . merely posting information so that others reading this forum were clear that a management company is hired to do a job and more often than not is crucified by the tenants who want to wiggle out of a lease and make the management comany or the owner out to be the bad guy.
Hopefully, you’ll figure it out when it happens to you.
Hello again,
RE: My tenant who is breaking the lease 5 months early
Now she is telling me she is short this month ( I know it should not be my problem!) and wants to apply Feb (last months rent that I have in escrow) to November. I said I was not in favor of that, but if that is all she could do, I guess it would have to be ok. That was yesterday, do you think I can/should reneg on that since I already agreed to return the security deposit if everything checks out in the unit, (even though she is supposed to forfeit deposit when breaking the lease)?? I am thinking of telling her she must make November payment, I will give her until the 5th, but that is the best I can do, since I already agreed to return security deposit if there is no damage. Why should I be making all the concessions when she is the one breaking the promise! Also, when I told her I was thinking of putting it on the market since I can’t find a renter, she said “I feel like you’re using my money to help sell your place!” I think that’s lots of nerve since I’m just trying to make lemonade out of lemons! It wasn’t my choice to have her discontinue the lease. Now that changes everything! It’s a slow renter’s mkt, and slow buyers’ mkt. I may consider lease option if I can find someone interested. Back to main question: should I tell her she still has to make Nov payment!?
Thanks in advance,
REFLA ??? ???
I have not read the other responses, but go ahead and give your 30 day notice. Not sure of your state laws, but in Texas, you can be charged a Reletting Fee, which is 85% of your rent.
Then put an ad in the paper, let someone move in under your deposit and you can give them a couple of weeks free rent, if your deposit is not high.
They then fill out an app with your management company, and have to qualify. They are concerned about collecting money. They want your home occupied.
In Texas you can only be charged until the day the next person moves in. My daughter had to break her lease, and she did the above, put an ad on Craigslist, and got tons of responses. Usually the new resident will have to sign a brand new lease, so make sure you give them incentive to move into your unready home.
Now you are seeing what happens when we diverge from the lease documents and make concessions, or even consider making concessions, to a tenant. They interpret that as weakness and will then try every story to get you to lose your money into their pockets.
Serve her with the notice to vacate . . . that will get her attention because hopefully the last thing she will want is an eviction on her credit report coupled with a collection account for unpaid rents.
And once you serve the notice to vacate, follow through to the eviction if necessary as quickly as possible. The sooner she either straightens out (good luck) or you get her out will minimize the loss of money to you and get the unit occupied by a paying, stable tenant.
Lastly, with that next tenant . . . follow your lease agreement, the law and your business instinct which should be greatly improved by your recent education for which you will have paid good money to obtain.
Most of us have been there and learned the same lesson.
Hi Cate,
Thanks, I know you are right. She’s actually leaving on Oct 30, so no notice needed She’s actually in agreement that she knows she has to pay up, but she has been trying to bend rules here and there, and since she is relocating to another town, it makes me nervous. I just sent a letter yesterday return receipt that said I regret not being able to apply Feb rent for Nov, but would give her a few more days to come up with Nov. I already made a concession that said I would return security deposit upon approval of unit, when I know I can keep it. So, yes, I am done with concessions!! She has been a great tenant in past, so I was trying to be recipricating.
REFLA.
I hate to say it but I think you can kiss any more money goodbye. It’s not the past that one looks to in order to determine if a tenant was a good tenant. It’s how they leave the unit and how they leave your pockets . . . the ones that should be getting the money that will now remain in hers.
Keep us posted. I’m curious to know if she pays anything.
