How to Terminate a Lease Early
We often enter into agreements with the best of intentions, but what happens when the future is not what we expect? This can often be the case when it comes to living arrangements, as what can appear to be miraculous can end up becoming a nightmare. While breaking a lease may not be the easiest task we may encounter, it can lead to a better outcome…and fewer headaches! Here’s how to terminate a lease early as a landlord and also as a tenant.
Terminating a Lease Prematurely as a Landlord
As a landlord, one of your main goals should be to keep your rental property occupied. However, despite this goal being quite important (especially if you are still paying the mortgage on your rental property with the rent being generated by the tenant) there are some instances where you may need to terminate a lease with a tenant prior to the full lease term has passed. Such instances can be due to a lack of payment by the tenant or the tenant violating the provisions that you have outlined in the lease agreement.
It is important to convey your plans to terminate your tenant’s lease as early as possible, as it can give the tenant an opportunity to bring the rent up to date if a failure to pay has started this process. Even if this is not among the reasons why you are looking to terminate the lease prematurely, it is important to speak with your tenant as early as possible regarding your intent to have them vacate the premises.
The experts at Landlordology recommend a minimum of a 30-day notice, which can allow your current tenants ample time to make alternate housing arrangements. However, before you begin the process of terminating the lease with your tenant, you should identify if you are going to terminate with cause (the tenant is not keeping up their end of the lease agreement) or without cause, with the latter less likely to result in a legal termination, unless you included a clause in the initial lease agreement.
Terminating a Lease Prematurely as a Tenant
When you signed your lease, you probably thought that you would be able to satisfy the requirements of the legally-binding document. However, life happens, and it may be necessary to break a lease before the full term has passed. As such, you should become aware of the steps that may be required if you are going to pursue the early termination of your lease, as well as the potential ramifications that can occur from breaking a lease.
Consequences
If you were to miss payments on a bill, you are likely to experience negative impacts to your credit and limitations on your future purchases. The same can occur if you terminate your lease without working with your current landlord or Property Management Company. For instance, the financial savvy experts at Money Crashers note that breaking your lease can result in civil lawsuits and a negative impact on your credit score, both of which can limit your options when it comes to finding a new place, even years after you made the decision to terminate your lease prematurely.
How to Terminate Your Lease Early
When you are considering the possibility of early termination of your lease, you should start with reading your lease and checking for the ramifications and limitations that are placed upon the potential breach of contract. Has your landlord or property management company held up their end of the bargain in regards to providing a safe and healthy living accommodation? If not, then you may have a chance at getting out of your lease with minimal legal and/or financial impact. If your landlord or property management company has kept their word on maintaining a safe living environment, then you may want to explore other options when it comes to breaking your lease. For instance, you may offer to forfeit the security deposit you left when you initially moved in, which is often a considerable chunk of money.
Conclusion
Entering into a lease is a legally-binding agreement between both parties. However, there may be times where fulfilling the full term of the lease may not be possible. As such, communication is essential to improve the likelihood of reaching an amicable agreement. The process can be a difficult one to navigate, both as a landlord as well as a tenant. If you are a tenant looking to terminate a lease prematurely or are a landlord looking to evict a tenant, it is important to know the legal guidelines when it comes to such a matter. However, opting to go with an experienced property management company can make the experience much smoother.
