You have a situation where a tenant moves out early. So, what now? They signed a formal agreement that ties them to the conditions, including the need to pay rent until the move-out date stipulated by you, the landlord. However, just as the lease protects the landlord, there are regulations in place to safeguard renters who wish to leave. As a property owner, you must understand how to manage these circumstances. This is one of the main FAQs for landlords, and we bring you a guide for dealing with it in the best possible way.
How does a lease work?
A lease is a legally binding agreement that defines the regulations agreed upon between the landlord/property owner and the renter. A lease can be one to several pages long. It specifies how long the tenant will be renting the apartment and how much they’ll pay in rent each month (and on what day).
It deals with the matters which often arise as things to ask potential renters. Security deposits, first and last month’s rent requirements, pet regulations, who pays for what utilities, and who is liable for upkeep and repairs are all essential points to go over. It might also cover overnight visitors, pool access, and parking lot usage.
A lease benefits both the landlord and the renter. It’s an explicit, written document that may be referred to if there are any issues concerning the rules. It provides the landlord with security by contractually ensuring that they will have a source of money each month and will get it at a set time. If any dispute arises, the contract offers a legal declaration of the landlord’s rights.
What if a tenant moves out early?
There are a few variables to consider when a tenant breaks their contract early. If you and a tenant sign the above-mentioned rental agreement or lease, you are both obligated by the covered agreements. In most situations, the tenant is the one who requests the cancellation of a lease, whether intentionally or inadvertently. It is relatively uncommon for a landlord or property owner to violate a lease.
There are several possibilities here. It varies, as with many legal answers — your state’s legislation may limit what the landlord can do. Also, the state of the local real estate market may affect what occurs after the tenant breaks the lease. If there are many rentals on the market, the landlord may be unable to rerent, and tenants may be obligated to pay the entire remaining rent.
Lease termination with advance notice
The majority of the time, a tenant will request early termination of a lease or rental agreement because they have to relocate for any reason. In many instances, the renter is required to relocate due to a job, so they will want to get out of the lease before it ends.
They might also have tenants’ insurance, so it’s a good idea to look into what that covers. It is in your best interest to actively deal with your renter who wants to vacate early. You must financially protect yourself. You’ll want as much notice as possible so that you can find a new renter to fill the vacancy.
The objective is to have a paying tenant in your rental property for as long as feasible while spending as little time as possible empty. Every day that you are without a paying renter, your previous tenant must pay.
Lease termination with no notice
Things become more complicated when your renter ups and leaves without warning, and you have no method of contacting him after they have left. It is not unusual to wake up one morning to discover that one of your rental apartments has been emptied without warning. They might even leave some things, so you’ll have to find a storage unit for their leftover items. In this instance, you should follow all of your state’s rules. You must ensure that everything is documented. You should try to locate your former renter, but you also need to find a new tenant to fill the vacancy.
When a tenant breaches a lease, most landlords must attempt to rerent the property
As mentioned, a lease is a legal agreement that requires the tenant to pay rent for the whole period. The fact that they pay in monthly installments does not affect the fact that they owe the entire amount to the landlord. So, what’s to stop the landlord from suing for the remaining months’ rent if the renters leave early?
Fortunately, property owners in most states cannot just relax and wait for the term to expire before suing the tenant for the rent owed after they’ve departed. Instead, landlords must take reasonable measures to rerent and, if successful, allocate the rent collected from the new renter to the debt. This is known as the landlord’s obligation to mitigate damages in legalese.
We recommend checking your state’s law on the landlord’s responsibility to rerent. This tenant-friendly rule does have certain limitations. Some landlords’ approach is to retain the security deposit (at the very least) and issue a letter requiring the balance of the rent.
Reasons to break a lease that are legally justifiable
The law recognizes that tenants may have valid reasons for leaving a rental before their contract expires. Here are some:
- Constructive eviction – A landlord’s failure to maintain a fit and habitable dwelling (known as a breach of the “implied warranty of habitability”) may be a legally valid cause for a tenant leaving early. The legal phrase for needing to leave under these conditions is “constructive eviction,” which indicates that the landlord has effectively evicted you by providing unlivable accommodation.
- Violation of quiet enjoyment – If a landlord severely interferes with (or enables someone to interfere with) the tenant’s enjoyment of the rental, the tenant may have reasonable reasons to break the lease. This right to “quiet enjoyment” can include a wide variety of activities, such as accessing the property without giving the tenant adequate notice, allowing illegal activity, and so on.
- Active military service – Tenants who join active army duty can move out early without penalty in all states. Tenants who need to terminate their lease due to military service must notify their landlord and provide a copy of their orders.