Early Lease Termination

Member since 2022 · 19 posts · 4 votes

My tenant wants to terminate their lease early. The lease ends 09/30/2024. They gave me a notice 05/15/2024 & are wanting to move out 07/31/2024. This is more than a 60 day notice. The lease states "Tenant shall not have the right to terminate this lease early". My question is can I legally keep their security deposit? I planned to tell them that "I will waive the final 2 months of the lease but unfortunately I will have to keep your security deposit". Is this legal in the state of Georgia? We plan to move into this unit, so finding a new tenant is off the table.

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Kevin Sobilo

Realtor · Hanover Twp, PA · Member since 2018 · 3k+ posts · 3k+ votes

@Hunter Jordan, if you have a well vetted lease written to conform to your state's laws then the answers are within.

If your lease doesn't have any early termination clause then technically there isn't any and assuming your state allows that the tenant would be responsible for rent up until the end.

To my mind, strictly enforcing lease terms is closer to a last resort than a first option. I always think communication and cooperation are MUCH MUCH better than going to court to try to enforce anything. So, I would discuss with the tenant and explain what they owe under the lease and what you would accept and why and see how they respond.

If this was a long term tenant of more than 2 years, I might not charge anything knowing this just gives me extra time to prep the place for my eventual move back in. If this was a tenant of less than 2 years, I might do as you are suggesting and want 1 months rent as a termination fee.

Keep in mind if you don't work cooperatively, you may not get that deposit either! The tenant may not pay their last months rent knowing its not worth your effort to evict with them already leaving. So, finding a middle ground everyone is satisfied enough with is always the first goal for me.

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Kevin Sobilo
Realtor · Hanover Twp, PA · Member since 2018 · 3k+ posts · 3k+ votes
2y
@Hunter Jordan, if you have a well vetted lease written to conform to your state's laws then the answers are within.
If your lease doesn't have any early termination clause then technically there isn't any and assuming your state allows that the tenant would be responsible for rent up until the end.
To my mind, strictly enforcing lease terms is closer to a last resort than a first option. I always think communication and cooperation are MUCH MUCH better than going to court to try to enforce anything. So, I would discuss with the tenant and explain what they owe under the lease and what you would accept and why and see how they respond.
If this was a long term tenant of more than 2 years, I might not charge anything knowing this just gives me extra time to prep the place for my eventual move back in. If this was a tenant of less than 2 years, I might do as you are suggesting and want 1 months rent as a termination fee.
Keep in mind if you don't work cooperatively, you may not get that deposit either! The tenant may not pay their last months rent knowing its not worth your effort to evict with them already leaving. So, finding a middle ground everyone is satisfied enough with is always the first goal for me.
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Gregory SchwartzBusiness Member
Rental Property Investor · College Station, TX · Member since 2016 · 1k+ posts · 1k+ votes
2y
@Kevin Sobilo is correct. Always rely on what the lease says and comply with local and state laws.
That being said our early lease termination policy has been well received by our tenants:
- Tenants pay a fee of 85% of one month's rent. This is an admin fee that covers the increase expense and headache of marketing, showing, screening tenants, etc.
- Tenants are responsible for the rent until the replacement tenants move in or the end date of the original lease.
This protects me from unwanted vacancies but gives the tenants a fairly low-cost option to get out of a lease. At no point in time do I plan on keeping their security deposits. The fee is paid upfront and the rent is paid at the beginning of each month. Security deposits are used for damages and are not designed to be applied to fees or rent.
[email protected]443-812-0357
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Nathan GesnerBusiness Member
Moderator
Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
2y
Quote from @Hunter Jordan:

You can only apply the security deposit to existing charges. If your lease doesn't list a termination fee, then you don't get to make one up as you go and you can't apply the deposit to a made-up charge.
You have almost 60 days to advertise and find a replacement tenant. Tell your existing tenant that you will let them go without penalty as long as they participate in helping you show the home and find a new renter. Offer them 24 hours notice for all showings, shorter if they are OK with it. Start marketing 30 days prior to termination and you should have a new tenant lined up before they leave.
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Theresa HarrisPro Member
Member since 2019 · 15k+ posts · 11k+ votes
2y
Look up the rules for Georgia (google it and look at the government website). What did the lease say if they broke the lease? Often it is a one month penalty, but it must say so in the lease.
If there is nothing in the lease (and telling them they can't break it, won't hold), then they gave you 60 days' notice which may be more than required by law try to get it rented and let them know they are responsible for rent until the end of the lease or if it gets rented before that. But you have to do your best to find a new tenant and get them in ASAP.
If it was me, they are 2 months from the end of the lease (no idea how long they've been there), they gave you plenty of notice and your lease doesn't state any penalty for breaking the lease; let them move out, get it rented and move on.
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Hunter Jordan
OP
Member since 2022 · 19 posts · 4 votes
2y
The lease clearly states "tenants shall not terminate lease early". Wouldn't this mean that they are on the the hook until the end of the lease period?
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Hunter Jordan
OP
Member since 2022 · 19 posts · 4 votes
2y
The lease also states security deposit will be returned if the full term of the lease has expired.
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Michael SloanBusiness Member
Property Manager · Richardson, TX · Member since 2023 · 31 posts · 15 votes
2y
@Gregory Schwartz
I agree. I handle early terminations basically the same way.
It also gives the tenant an incentive to leave the property clean and move in ready
[email protected]469-436-3645
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