When thinking about someone breaking a lease, you most likely picture a tenant who ends the lease early. However, that’s not always the case. In some circumstances, it’s the landlord who needs to end the tenant’s lease early. So, can a landlord break a lease early?
Landlords can break a lease, but only within specific circumstances. In this Redfin article, we’ll outline the reasons you can break a lease agreement and how to tell your tenant in advance. Whether you’re a landlord renting your home in Phoenix or a property manager leasing an apartment in Denver, find out when you can break a lease early.
Reasons landlords may need to break a lease agreement
There are a variety of reasons that can lead to property owners serving an early termination notice to a tenant. This isn’t the same thing as an eviction, although there are some common reasons for breaking a lease and wanting to evict a tenant.
Landlords often fit one of the following reasons for breaking a lease or rental agreement.
- You want to sell the property or decide to live in it yourself.
- The tenant has violated the rental agreement or is behind on paying rent.
- The tenant committed illegal activities on or near the property.
- The property is in poor condition and the necessary repairs are too expensive for you to pay for.
Breaking a lease is a difficult decision for landlords, but it’s important to understand the consequences of doing so before taking any action. Most states have very specific laws dealing with breaking a lease by either a tenant or a landlord. Understanding local law first ensures the reason you’re providing for breaking your lease isn’t going to get you in trouble with the renter.
Adding a termination clause in your lease agreement
Even if you don’t anticipate a reason for terminating a lease agreement early, it’s best to include an early termination clause in your lease. That way, you’re protected and expectations are clear, should you need a tenant to vacate a property before their lease is up.
A good early termination clause will follow the local law and set out the process for this situation. You need to spell out what must happen, no matter who’s initiating the lease termination. Include everything from how much notice you need to how you’ll notify the tenant about ending the lease early. A typical notification period is between 30 and 60 days in advance of the date a tenant needs to move out.
Most landlords prefer a written notice whether they’re receiving notification or giving it to the tenant. If you’re breaking the lease, you’ll most likely want to put your written notice on the tenant’s door, as well as send a digital copy. This ensures they get the message.
This clause should also specify any fees the tenant will have to pay if they’re in violation of the lease terms, and what will happen to their security deposit and any prepaid rent.
How to terminate a lease early as a landlord
To avoid an eviction lawsuit, you must carefully follow the process you’ve spelled out in your existing lease and comply with local laws. If you can wait for the lease term to finish, it’s always easier and less complicated. However, if you need to end a lease early on your rental property, here’s what to do:
- Notify the tenant in writing of your intent to terminate a lease.
- Give the tenant a reasonable amount of time, 30-60 days, to find a new place to live.
- Recommend the tenant to another landlord or rental housing authority to help them search.
- Discuss how this impacts the tenant’s security deposit and/or paying rent for the remainder of their stay.
In theory, if it’s you who decides to break the lease, there are no fees the tenant must pay. That typically only happens if they contact you to move out early. There also may only be fees if the lease is a fixed term, rather than a month-to-month lease.
Additionally, all deposits made at the time the lease was signed are treated the same way even if you break the lease. You should use the security deposit to assess damages, and return it (or as much as possible) within a proper amount of time once you’ve set the new move-out date. You’ll want to do the same for the last month’s rent deposit if that was part of the lease. You can use it to cover the tenant’s final month of rent, rather than asking them to pay again. .
What if my tenant has a month-to-month lease?
Having a tenant on a month-to-month lease definitely makes it easier to ask them to move out of a property in a shorter time frame. A month-to-month lease only ensures the renter access to the property one month at a time. For this reason, you have the ability to ask them to move out at almost any point.
Though you must provide 30 days’ notice, it’s not really the same thing as terminating a lease for a month-to-month renter. They’ll most likely expect the notice to come from you at some point.
Once your tenant completes their first year on a lease, offering a month-to-month rental agreement may be a good strategy. It can make being a landlord easier and gives you more flexibility with your property.
How does my tenant pay rent if the lease ends early?
Even if you initiate the process to terminate a lease, your tenant must pay any unpaid rent they owe you. They should also keep paying rent until they move out. If your tenant paid last month’s rent upfront, you can apply that to the new last month your tenant will be on the premises.
Local laws when breaking a lease
Many states and cities have similar laws when it comes to either a landlord or tenant terminating a lease early. However, these laws can vary depending on your location. Laws can differ on how much notice you have to give, what fees are charged, and the valid reasons for breaking a lease early.
An important factor in the process though is keeping tenants’ rights in mind. Based on state laws, tenants may be able to:
- Remain in the property until a new tenant is found.
- Receive compensation for any damages caused by the landlord breaking the lease.
- File a lawsuit against the landlord.
To avoid these issues and any extra costs, you want to approach the whole process very carefully. This is especially true if you’re taking this step with prospective tenants or are selling your home. If you’re unsure of your local or state laws, you can consult with an attorney.
When you can’t terminate a lease early
The only time you can really terminate a lease without any reason is at the actual end of a lease term. At that point, it’s your call to not renew the lease agreement. However, there are situations where you may want to terminate early, but can’t. These include:
- You don’t like your tenants, but they’re still following all the terms of the lease and the law.
- You want to rent your property to a friend or relative, although you have a current tenant in place.
Even if you have a good reason to terminate a lease early, you may want to start with a warning letter, giving a bad tenant the opportunity to fix their issues. For example, this could be appropriate in an instance where the tenant is late on rent or has possibly broken a term of the lease that they can fix. An example of a fixable issue is if they recently got a pet, but pets are not allowed in the lease terms. If the tenant rehomes the pet within your set time frame, you may not want to follow through with terminating the lease.
On the flip side, if you do decide to terminate a lease, and the tenant refuses to leave, you’ll have to evict them. Eviction is a costly legal process that requires an attorney. With so many legal factors to consider, deciding to terminate a lease early isn’t a decision to take lightly.
Deciding to terminate a lease on a rental property
There are many reasons why you may need to break a lease early, but you still have to navigate things carefully. Maintain solid contact with tenants and be clear on when and why they need to vacate. You’ll need to handle everything correctly which means it’s not always the right decision to terminate a lease early. Weigh the pros and cons, make sure you have a valid reason, provide proper notice and protect yourself throughout the process.
The post Can a Landlord Break a Lease Early? Reasons You May Need to and How to Do It appeared first on Redfin | Real Estate Tips for Home Buying, Selling & More.
from Redfin | Real Estate Tips for Home Buying, Selling & More https://ift.tt/cRXlrpd
No comments:
Post a Comment