Need advice on a tenant defaulting

Hi all-

I have a tenant who is 3 months into a 12 month lease. Yesterday she emailed me to say she is terminating her lease at the end of August - something about pregnancy related problems so she is no longer going to live in Boulder. A lot of “I’m sorry, it’s a great place, etc”.

What would you do in this situation? I am tempted to email her and ask her what settlement she has in mind for the remainder of the lease, but I’m afraid that if I offer her a one or two month buyout, then that is all I can ever ask for if it comes to legal action. If I agree to start showing it now and take her keys back, does that release her from the lease? I don’t want to say the wrong thing here.

Should I contact a lawyer? Would you wait until she is actually in default next month and then start eviction/legal proceedings? I believe she is a pretty established professional and should not be hard to find, and is also not broke by any means.

Thanks for any advice you can give,


Welcome to landlording! :biggrin

Leases mean absolutely nothing (effectively or legally) to tenants. They can break them on a whim. Courts won’t uphold them in a landlord’s favor.

There’s so many reason(s) to break a lease; death, disease, divorce, etc. You name it, and courts are sympathetic.

Landlords, not so much.

Technically, you have a lease. Effectively, you do not.

So, to cut to the chase …acknowledge the tenant’s evacuation notice, and affirm her move-out date.

Once you’ve got the move-out date established, you begin planning to bring the unit back to marketable condition.

Tenants breaking leases, pretty much gives you the advantage in justifying any repairs/cleaning/restoration as “abnormal” wear and tear.

Anything you would have to do, should be considered premature, as the habitability and marketability of the unit “should” last for at least the first term of the lease.

If the tenant is not just looking to become a deadbeat, you should just treat this like a normal tenant turnover. Again, confirm the move-out date; insist the date be adhered to; do a move-out inspection upon the tenant’s evacuation; return the balance of the deposit not spent to make the unit marketable; and in the meantime re-rent the unit.

Next time, get the maximum deposit allowed by law (if the market allows this), so that you have more leverage over the next lease-breaker.

I would follow the standard provisions in my lease, regarding tenant evacuations.

I don’t see any need to make extra deals with the evacuating tenants. Just get a confirmation on the evac. date, and pro-rate any rents owed, through that date (if it’s not the last day of the month).

I know in some states, you can’t legally deduct rents from deposits. So, if the tenant leaves owing rent, and there’s enough left over in the deposit to cover the rents owed, just adjust the stated management/maintenance/overhead costs to compensate.

This situation should be an example of why it’s a good idea to incorporate specific terms into your lease agreements, regarding early terminations.

Hope this helps.

P.S. If the tenant morphs more into a snake-bite, I would just offer her ‘cash for keys’, if she agrees to be out by ‘x’ date (and the place is clean).

Whether the place is clean, or not, isn’t the point. It’s regaining possession of the unit, without having to go to court; without having to appeal to a judge for back rents; without putting the debts to collection; and without futilely attempting to garnish wages, tap tills, and otherwise spin my wheels trying to redeem my crappy selection of a tenant.

Thank you for this information-

As a follow up question, the tenant has agreed (verbally at least) to pay one month’s rent in exchange for terminating their lease early. Can I then move a new tenant in Sept 1st and collect rent from them? Is it legal to call the first tenant’s payment a lease termination fee or something so that I would not be collecting double rent?



I have no idea what the laws are in your state about charging a ‘lease termination fee.’ If it was legal, sure I would.

However, it ‘is’ illegal in most states to double-dip on the rents.

You’re gonna want the ‘termination fee’ paid immediately, not after the move-out, otherwise, you be not gettin’ that money, hunny.


When I have had to deal with these types of situations, I would require the tenant to continue to pay the rent until I have filled the unit. I show proof of aggressive advertising such as newspaper ads and signs, etc.

If the tenant moves out September 1st and pays both September and October rent and you find a tenant that moves in October 1st, even though I would love to keep both October rents, I would only charge the tenant for actual expenses and refund the rest along with the security deposit less any costs for damage.

The first thing I tell people is that my policy is to start showing the place and release them from the lease as soon as i find a qualified tenant. If they offered a months rent for an early termination fee, I would take it.

You aren’t double dipping on the rent. The early termination fee covers the risk of vacancy, time to touch up paint, show the unit, do a move in and a move out with the current tenant. Best case scenario is still 8 hours worth of time and worst case is a few thousand dollars. I would take the money offered, release her, and get it rented immediately. Don’tcall it rent, call it an early termination fee. Giveher a reciept with that terminology on it.

There are lots of times that the policy and the name of the money is important. Another example is when taking deposits from tenants before a house is ready. My policy is that with a deposit and signed lease I’ll stop showing the house and the first months rent is due at move in. The deposit is not the security deposit. It is a non refundable holding deposit that converts automatically to a security deposit at move in. WHY?? What iff the tenant changes their mind? Then I have a vacancy because I stopped showing the house. Security deposits are refundable, holding deposits are not.


That’s some seminar-quality stuff you offered there!

Great post.

I gotta agree with you javipa. This is the first time I am hearing about holding deposits converting to security deposits. That is a great idea! What a way to work around the system but to provide good services to your tenant.

Now I wish I knew where it came from. I’ve been doing it so long I can’t remember.

Thanks for the compliments though!