I tenants that would like to break their lease but no clause in the lease covering the situation. They have been in place for a little over a year and signed a second lease through April 30 so we have 8 months to go. They (I'll call them tenant A) have been great tenants but have been having trouble with the new neighbors (tenant B) for the last 2 months.
We addressed the situation with tenant B and basically told them to all get along or get out, made a schedule for use of the limited parking available which seemed to be the cause of the initial friction in the house. The situation has improved, however tenant A still feels uncomfortable with tenant B and feel that they are being passive-aggressive towards them. What exactly that behavior is I haven't clarified yet, but I am guessing things like stomping around upstairs etc.
Tenant A wants to know what their options are for breaking the lease, mainly how much notice would we need, and they have not found a new place yet- this is a college town and classes start next week so finding a place will be difficult. Finding a new tenant shouldn't be, and possibly we'd get a longer term renter out of the deal since the timing would likely mean a non-student renter.
The way I see it we can:
A. Let them out as if it were the end of the lease with 30 days notice, use the vacancy (if there is any) to improve the unit.
B. Let them out but hold them responsible for the (prorated) rent during the vacancy
C. Let them find a subletter, who will need to pass our background checks, leaving them still responsible for rent if the subletter flakes
D. Let them find their own replacement, who will need to pass our background checks and sign a lease with us.
I will be putting a clause in my lease to cover this situation, what do you suggest is a reasonable early termination fee?
Down here the law says the landlord must mitigate damages from loss of rent if a tenant jumps ship. Since they've been good folks and are discussing the issue ahead of time with you, I would let them out with 30 day notice but hold them responsible for prorated rent until the next tenant comes on board. If they're smart, they'll cooperate as you show the unit and attempt to mitigate their losses.
If the property needs some updates, you can let it go vacant after they leave, or perhaps even get to work (or have a solid plan) while they are still in there.
Is A worth holding on to and removing B?
Mike, Thanks for your reply and advice.
I am sure that tenant A would cooperate with showing the apartment, so that wouldn't be an issue.
I would much rather have tenant A stay and get rid of B, but B's lease doesn't end until June and they haven't done anything to warrant getting them out early since we had a chat with them about the importance of being civil to their neighbors and abiding by the quiet policy (11pm to 8 am) in the lease. Before that, A & B were fighting over the parking, and B told A to "F" off and refused to speak to them, B purposely made loud noises to disturb A, childish behavior like that. We will see how B behaves over the next few months before we decide whether to renew with them next June or not.
Two posts in one morning about the virtues of month to month leases. I prefer month to month because you can deal with situations like this. A long lease ties your hands. And, as in this case, the tenants hands.
I have an "improper lease termination fee" clause in mine. The fee is equal to the security deposit. I've not had to apply it since I switched to month to month leases. If you can easily find another tenant, let them out with minimal pain. Propose a fee that covers the costs of you finding another tenant. If you're using a PM, that's their fee plus some for your time. If not, its your time. Around here PM's typically charge half to a full months rent to fill a vacancy.
After your response on this post and the other one from today (where the boyfriend moved in with no background check) I am going to consider month to month again. In my area it seems harder to find a good tenant the less notice you have, at least that has been my experience. Since 2/3 of my tenants are students, I was concerned that month to month leases would leave me with vacancies in the summer, that students and their parents would be concerned about them losing their homes halfway through the year and that I would forever be renting to those that weren't planning ahead. Prime time for tenant changeover is now and in the late spring. Do your tenants give you more than a month's notice they are leaving? In my area, landlords start filling vacancies about 7 months in advance!
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