Can my tenants break their lease?
Posted on Thursday March 11, 2021 at 03:02PM in General
Can my tenants break their lease?
Usually when a tenant signs their lease, you expect them to stay in the unit for the entire term of the lease. But occasionally this may not be the case. Your tenant could decide to move out early and break the lease. Is a tenant able to break their lease? What should you as their landlord do?
Your tenant most likely intended to rent your property though the entire period of the lease. Lots of different situations could have caused your tenant to move out early such as a job transfer, job loss, opportunity to buy a house, etc. Usually, if your tenant needs to break their lease, it’s for a good reason.
Is your tenants still financially responsible for their lease even if they move out early? You can’t make your tenant stay but this is still an important question for you to consider. Here are important details on how to proceed if your tenant breaks their lease.
A lease is bindingIn the same way a lease protects tenants from their landlords kicking them out before the lease ends without a cause, a lease also protects landlords from tenants who want to leave early. When your tenant signs their lease, they are agreeing to pay rent every month (or bimonthly/weekly) for the entirety of the lease. In most cases, if your tenant moves out 4 months early, they owe your rent for those 4 months. Although there are some exceptions.
- Check your state’s laws
- The unit in uninhabitable When renting to tenants, it is essential that you are providing them with an inhabitable place to live. You must provide a non-leaky roof, hot water, doors, windows that lock, heat, functioning electrical systems, safe stairs (if applicable), and no pests for the unit to be habitable. If you aren’t providing your tenant with a safe and livable unit or if you aren’t responsible in fixing anything that comes up that causes the unit to be uninhabitable, your tenant may be able to break the lease.
- Military or active duty Federal law allows people in the military to break their lease agreement to begin active military duty or if their orders take them approximately 50 miles or more from their unit. This law is called the Servicemembers Civil Relief Act and applies to members of the armed forces, National Oceanic and Atmospheric Administration (NOAA), activated National Guard, and U.S. Public Health Service. If this is the case, your tenant won’t need to provide you with a 30- day notice if they are leaving for military reasons (even if there is time left on the lease).
- You’re intrusive Even though you own the property, once you collect rent from your tenant, you forfeit the right to enter anytime you would like. In an emergency (for example the unit is flooding) you are allowed to enter the property, but if you would like to conduct a routine inspection or make a repair, you have to provide your tenant with a notice (visit https://www.schedulemyrent.com/blog/ for types of notices to send to tenants).
- What your tenant can help with If your tenant tells you that they want to break the lease, you can ask them to help you out. Your tenant might be able to help you find a responsible replacement tenant who can continue the lease, or they could show the unit to potential tenants. You should still screen your new potential tenant though.
- Fees for early termination As mentioned above, you are able to charge your tenant their rent amount until the lease has ended, as long as you are looking for a replacement tenant.
- Suing your tenant You might end up in a situation where you need to take your tenant to court. This could be the case if your tenant breaks the lease, won’t pay rent for the months until the lease ends, and won’t pay an early termination fee. It is important to consider talking to an attorney before taking legal action. When going to court, it could be possible for you to just present a copy of the signed lease and tell the judge which months your tenant owes rent for.
- Prepare for false charges To avoid paying rent after breaking their lease, your tenant might decide to place false charges on you. For example, they could claim their unit was infested with insects or rats (and you did nothing to remedy the situation), the heat didn’t function (or anything that could cause the unit to be determined uninhabitable), or you continuously visited their unit.
In most states, landlords are not legally allowed to hold their tenants to the terms of the lease while the unit is vacant. Even though the tenant has broken the lease by leaving early, the landlord must try to re-rent the unit (even in inconvenient times). Although your tenant is still responsible for paying their rent while you find a new tenant. You are still able to go through your usual screening process for tenants (you don’t have to rent to the first person who applies if they don’t meet your requirements).
In a few states, landlords are not required to look for a new tenant. In this situation, they can hold the tenant to the lease terms for the entire lease. It is important to know the specific laws of your state.
Even if you are being intrusive and not respecting your tenants property and privacy, your tenant still has to give you a warning before leaving. They need to provide a “notice to remedy or quit” which can be a letter saying “Stop coming by unannounced, or I’m terminating the lease in X days”. Your tenant will most likely not terminate the lease immediately. If you receive a “notice to remedy or quit” from your tenant, you might want to consider talking to a lawyer to ensure you aren’t violating any state or local laws.
If your tenant would prefer not to pay the ongoing rent charges, you could offer to charge an “early termination fee”. This fee is designed for the tenant to pay an amount that allows them to break the lease and leave without repercussions.
This fee is nonrefundable, so if your tenant decides to pay this fee (usually equal to two months’ rent) and you find a tenant within two months, you aren’t obligated to refund the prorated amount to your tenant. On the other hand, if it takes you three months to find a replacement tenant, you are not able to charge your tenant that third months’ rent if they agreed to pay the early termination fee.
If you decide to offer the early termination fee, make sure that you specify the amount in your lease, so your tenant has enough warning. This is important because you are not able to charge double rent amounts, but you are able to charge rent to your replacement tenant and collect the early termination fee from your original tenant. This is possible because your tenant decided to pay the fee to avoid the possibility of paying rent for over two months.
It is important to be prepared for these kinds of charges in order to defend yourself against them. You should keep maintenance records and photos of the unit to prove that you maintained the unit. Rental Property Management Software like Schedule My Rent provides Maintenance Requests so all tenant requests are easily documented incase you need them.