Looking for advice on tenant who wants to break lease

St. Louis, Missouri
General Landlording & Rental Properties
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Looking for advice on tenant who wants to break lease

Howard H.Pro Member
Member since 2020 · 5 posts · 0 votes

I have a residential tenant who screened very well. Single female with 20+ years same job. 7 years in previous rental home, forced out when the house was sold. She wanted stability and asked for a 5-year lease term. She pays promptly and has presented no adverse issues. Now just shy of 1 year into the lease, she is engaged and wants to break the lease to move in with fiancee into his house. To handle this, I am leaning toward drafting a lease addendum with terms for a cash lease buy-out should she decide to break the lease early. The buy-out would cover all re-lease expenses, 1 month anticipated vacancy, and a fixed fee of some kind. The security deposit would not be allowed to be applied as part of the lease buy-out charge. That deposit or remaining portion would be returned after she vacates. I have no experience with breaking a lease and so am looking for other ideas, approaches or thoughts on my idea for how to handle this. Thank you.  

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Linda S.
Investor · Richmond, VA · Member since 2016 · 1k+ posts · 2k+ votes
4y

@Howard H.,

Don't make this a bigger deal than it needs to be.   We see turnover as a blessing in disguise, as 99% of the time, that's when we increase the rent rate!   Check your lease-- and see what terms you guys have agreed to as far as terminating the lease, and go by that-- you can't make up rules as stuff comes along, you're locked into your lease terms.   

I'd tell her she will be charged a fee (if applicable in your lease), and then focus on having it rent ready for the next person!  We often do showings when the prior tenant still lives there,  I think of it as free staging.   Also, most good tenants will need at least 30-45 days to move, so it will minimize vacancy. 

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  • Nathan Grabau
    Realtor · Longmont, CO · Member since 2021 · 577 posts · 631 votes
    4y

    I would focus on the fact that the lease exists as an agreement between you and your tenant. If you guys can both come to a solution that you are happy with, it is much better than having her leave angry. You're on the right track. Also kuddos to you for choosing not to be an ******* when many others would be. 

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  • Nathan GesnerBusiness Member
    Moderator
    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
    4y
    Quote from @Howard H.:

    I have a residential tenant who screened very well. Single female with 20+ years same job. 7 years in previous rental home, forced out when the house was sold. She wanted stability and asked for a 5-year lease term. She pays promptly and has presented no adverse issues. Now just shy of 1 year into the lease, she is engaged and wants to break the lease to move in with fiancee into his house. To handle this, I am leaning toward drafting a lease addendum with terms for a cash lease buy-out should she decide to break the lease early. The buy-out would cover all re-lease expenses, 1 month anticipated vacancy, and a fixed fee of some kind. The security deposit would not be allowed to be applied as part of the lease buy-out charge. That deposit or remaining portion would be returned after she vacates. I have no experience with breaking a lease and so am looking for other ideas, approaches or thoughts on my idea for how to handle this. Thank you.  


    I think you're on the right track. I require tenants to give 30 days notice and pay a termination fee equal to a month of rent. The termination fee is due at the time they give notice. They also must let me market the home and arrange showings with at least 24 hours notice (unless they agree to something shorter). At least 80% of my terminations are willing to pay this fee, then I'm able to put a new tenant in shortly after it becomes vacant, which puts more money in the Owner's pocket.

    In the future, avoid signing leases greater than one year. In my experience, most of them break early. A one-year lease also keeps you on track for inspections and periodic rent increases.

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  • Corby GoadeBusiness Member
    Investor · Boise, ID · Member since 2014 · 3k+ posts · 3k+ votes
    4y

    Obviously if all parties agree, you can do whatever you want, BUT- your lease should already have clauses that dictate what happens when a lease is terminated early. Also, your state or city might regulate what your rights as a landlord may be in a situation like this. Make sure you know your lease and the laws before you propose any type of solution. 

    Good luck!

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  • Linda S.
    Investor · Richmond, VA · Member since 2016 · 1k+ posts · 2k+ votes
    4y

    @Howard H.,

    Don't make this a bigger deal than it needs to be.   We see turnover as a blessing in disguise, as 99% of the time, that's when we increase the rent rate!   Check your lease-- and see what terms you guys have agreed to as far as terminating the lease, and go by that-- you can't make up rules as stuff comes along, you're locked into your lease terms.   

    I'd tell her she will be charged a fee (if applicable in your lease), and then focus on having it rent ready for the next person!  We often do showings when the prior tenant still lives there,  I think of it as free staging.   Also, most good tenants will need at least 30-45 days to move, so it will minimize vacancy. 

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  • Howard H.Pro Member
    OP
    Member since 2020 · 5 posts · 0 votes
    4y

    Good information. Thanks to all who replied

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