Tenant thinks his lease was void when we bought the property

14 Replies

This guy is driving me nuts.  He is breaking his lease a month early and wants his security deposit back because he thinks that when we purchased the property that his lease was void, and NO his lease says nothing of the sort, he just thinks that's how things work.  His lease does in fact mention circumstances at the potential sale of the property and it only gives us, the new landlords, the right to terminate the lease with 30 days notice.  Can someone please tell me where I can find documentation for Ohio that I can show this guy stating that his lease does NOT automatically void when the property sells?

If you plan on doing any repairs to the property, I'd probably just be thankful he's moving out quickly to allow me to get in there.  If he left the property clean and in good condition, I'd just return most (or all) his deposit and happily move on.  After all, it's only one month early.

It doesn't matter, that is one month rent that I was going to be collecting, not to mention he just left this weekend (hopefully) and didn't pay rent THIS month either.  If I give him back his security deposit then I'm down a security deposit, 1 month rent, and 1/2 month rent.  Also, he has 2 pets and his lease clearly states no pets.

If he hasn't paid the May rent yet, he's doing you a favor by asking if he can move out before June 1.  The fact is, it doesn't look like he plans to pay either May or June.  If I were you, I'd counter his offer of moving out at the end of the month and getting his security deposit returned, with moving out at the end of the month and not getting his security deposit, which you would use for the May payment.

The guy is already proving to be a problem tenant ... and you just became his landlord.  I wouldn't want to extend this relationship any further than necessary.  If he's already moved, good riddance.  Verify he's actually gone.  Give him notice you want to inspect the house.  If everything is in the shape it was in when you bought the house, I'd consider returning a portion of his deposit (1/4 to 1/2) just to get him out without having to go to court.  

Certainly, it's your right to fight to force this problem tenant to stay in your property, but why would you want to?

Good luck.

It likely would have been safer to agree to the early termination and have him sign a release stating he agrees to vacate early, especially if he was already in violation with the pets.  Now, when you say he left this weekend, hopefully, I believe (not a lawyer, no legal advice) that means, however unlikely, that he could still demand access to the unit until lease end date unless you actually perform eviction proceedings, even if he owes you rent.  I would make certain I followed proper security deposit procedures, documenting everything showing you used the whole security deposit in back rent and damages, then send it certified mail in a timely manner to his last known address, even if it is that unit.   Hopefully, you just won't hear from him again, which is the normal thing, but in case you do, you'll have some documentation that you tried to do the right thing.  Also, if he's left any belongings, you'll have to check into proper procedures if your state requires storage for x days before you can dispose of anything, which in the states I'm used to is not required if they sign a release and turn over keys but is if they leave without notice.  Leaving early without a release is such a pain that I will usually go out of my way to make it easy for a tenant to leave if they actually tell me they want or need out early, and I usually work out something where I'll agree to a portion of their security deposit back if they leave it in good, clean condition.  

Sarah hopefully you inspected this unit and have healthy reserves. Many investors do not calculate when buying the worst case situation.

You buy, the tenant then wants to move out, you lose rents plus rehabbing of the property to get rent ready again ends up being 3,000 in repair costs.

How run down the place is will depend on if the past owner fixed things correctly or rigged stuff and if the tenant has been there a long time wearing the place down. It doesn't matter that the tenant has appeared to move. If they still have stuff in there then they are using it for storage. Each state has personal property disposal laws that must be followed. You have to go through the eviction process. Now if the tenant wants to sign an early termination form for an agreement to get back so much of the security deposit than that is negotiated.

You make sure before such an agreement is signed by both parties that ALL items have been moved out of the unit and that all people on the lease sign the document. You need to check for undocumented people living there that are not mentioned on the lease over the age of 18. Once unit is clear and doc is signed have all the exterior locks changed including front ,side, rear door. No telling who has keys to what over the years.

Land lording is supposed to be black and white with the laws. As people become experienced landlords you learn it is all a negotiation to try to get the best outcome for yourself and keep the cash flow coming in again.

You could be a stickler on the security deposit. The tenant could also be judgment proof and trash your place and you incur additional rent losses and damage. You might be in the right per the lease but it doesn't get you where you want to go faster. So check and see if this tenant is judgment proof or has good credit, income that can be attached, etc. if you go down that road.

No legal advice given. 


Sarah, your written contract is your LAW. The lease he signed will show when his lease started and when it ends. You contract is even stronger since the lease has the situation of what happens if the property sales. 

You are not required to give back the deposit if he does not finish his lease, this should be written in the agreed terms that he has already signed. You have the right to start eviction if he did not pay rent.

You have two options;

1. Send a written notice that a eviction will be filed for non payment and explain it will show up on his rental screening for his new landlord, possibly preventing him from renting a nice place. Your lease should state that the deposit will be forfeited it this situation. 

2. Allow the tenant to move out early and give back deposit after walk through between you and the tenant, minus cleaning/ repairs cost. 

I personally would want to hold him to his contract, but since he only has 1 month left I would sallow my pride and realize its better to let him out of contract rather then him damage unit and me spending hours in the court system trying to recapture my loses.

Sounds like he is moving out either way - with or without your permission. Since this is a better time of the year for finding tenants, and you didn't have to go through eviction to get him out - good riddance.

So you have the matter of uncollected rent; you have to go through the eviction process to get a judgment for the money due. If landlord tenant laws there allow the deposit to be applied to amounts owed, then you use the deposit to cover what is owed. Can't say which of those applies. If there are damages that exceed the amount of the deposit, then you have to try for a judgment.  If you get a judgment for monetary amounts, you still might not get paid anything on that judgment. 

The sad thing is that landlord tenant laws will still require you to give an accounting of how the security deposit was applied and that must be done within a specific time period or else the tenant can seek double or triple the amount if the deposit as penalty. 

Unless HE wrote the lease (not the seller), it's already problematic that the lease as written gives unilateral rights to break lease on sale to new owners, but not to tenants.

To me that's a can of worms if it lands in landlord/tenant court proceedings cuz it can be argued for instance that while the seller was showing the house for sale, quiet and private use were violated with potential buyers in and out often, yet the lease was written up to keep tenant locked in that uncomfortable situation of house/unit being shown, sold, new owners can end lease, but tenant can't do anything about it.

Surprised all the fuss over what, giving 30 days notice in advance of lease term? sounds like tenant is doing you a favor to an extent allowing you to start clean slate as far as his unit at least and that unilateral clause in the old lease.

Thanks everyone.  My personality tells me to make him hold to his contract.  However, I really don't want to deal with this guy anymore.  I think I am going to explain to him what I COULD do (keep his entire security deposit and attempt to collect unpaid rent for this month), however I am just going to keep the portion of his rent to pay for his unpaid rent for this month and return the rest.  Hopefully this will just piss him off but keep him content enough to leave it alone.

As always, thanks BP!

Why not just let the guy leave and your new hand picked tenant in there?  You really want to force a guy like this to stay?

Just move on from him and get someone quality in there who won't be a headache.  In the short term this will be a little bit of a headache, but in the long term you will be glad you did.

@Michael Noto  No I'm letting him leave.  The question was that he wanted his security deposit back and I didn't think it was fair for me to have to give his deposit back when he's leaving a month and a half early.  But he thought he should still get it back because he thinks his lease automatically was void when the property sold (so he doesn't think he's breaking the lease early)

@Sarah Miller In Connecticut we have 30 days from the move out date to give the deposit back to the tenant. Does Ohio have that law?

If so, just ask him to leave you a forwarding address and then a week or two after he moves out write him a letter (based on facts) that states why he is not getting his security deposit back.

If he asks before he moves out if he's getting it back, just say that per state law we have 30 days to give it back to you and we need to do our walk through of the apartment to assess for damages once everything is moved out of the apartment and cleaned.

That sounds like an excellent way to ensure mysterious flat tires, rocks through windows...

Originally posted by @Richard C. :

That sounds like an excellent way to ensure mysterious flat tires, rocks through windows...

Exactly.  I don't really want to deal with this!! Especially since his forwarding address is just a few blocks away!  Definitely just going to compromise.  I have a new tenant already lined up and I'm excited to get her in instead!

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here