Would you allow an early release from lease?

Question

A tenant has requested an early release from his lease with seven months left.  They want to buy a house.  I am finding it very difficult to rent two other houses now in the winter, so this will just be one more if we let them out in February or March.  What would you all do?

Aly W. · Answer

I did this for tenants that wanted to buy a house, shortly after renewing the lease with us. They were excellent tenants and they asked first. They agreed to do all the showings and stay until literally the day before the new tenant moved in. They kept the unit spotless. It worked out very well.

We're currently working with another tenant who wants to move out of state 4 months before the lease ends. We agreed on the same terms - cooperate with showings, keep the place presentable, and stay or pay until the day before a new tenant moves in. Tenants with good intentions will be happy to work with you if you work with them.

Chris Cooper · Answer

Have they found a home already? If not, offer that you will allow them to break the terms so long as you will be making the same or more rental income than if they had fulfilled terms of the lease they signed, and when you do - they can receive get their deposit back. Which may go a way towards helping them decorate their new home or whatever.

Also you should request they work with you, i.e. keep the house in showable condition (clean, animals put away, whatever) for when you are showing prospective tenants. Make that a condition of them getting any deposits back.  Make that as incentive to getting their security deposit back and they are more apt to work with you, hopefully.

Good luck - let us know how it shakes out!

Rocky V. · Answer

This just happened to us last month.  We agreed to let a great tenant go with these terms:  pay two months in advance and we would refund any money once a new tenant occupies home.  Tenants were always early on payments and we never had any issues with them.  It took 2 weeks to find new tenants.

Jeff Rabinowitz · Answer

In reality, there is very little you can do to make them stay. The only question is what you will charge if they vacate early. If they are collectible you might charge for the rest of the term of the lease but if this went to court most judges are going to require that you made a good faith attempt to rent the property. It is unlikely you would get more than a couple months rent in a judgment. If your tenant is just looking for a house it will take them months before they close (if they find one right away.) Why not allow them to break the lease if they pay you a couple months rent (or rent for the period it is vacant if that is less), they give you 60 days notice and allow you to show the home before they leave. They will have an incentive to leave the home in good condition as that should shorten the vacancy period. Get their permission to place a for lease sign in the yard also. This way everyone's interests are aligned and you part on good terms.

Ryan Haase · Answer

I would charge them a breakage fee to cover your vacancy. At the end of the day, if they move out and stop paying, are you going to come after them? If not, try to get a fee and you'll both be happy.

Kyle Boughton · Answer

Honestly in would depend on your situation. If you could financially take the burden and are feeling good hearted then go for it. If it were me I would come up with some terms that would require to find another tenant before they move out. That way you would be out the least amount of money as possible. What are your thoughts? Are you leaning towards a certain way? Honestly they signed the terms of agreement and if you are having a hard time renting units at this time I wouldn't do it. You need to look out for your own financial well being. Its not like your ripping them off. You have no reason to feel bad in this situation.

Best of luck to you!

Would you allow an early release from lease?

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