I just bought a fourplex and literally the day after I closed one of the tenants had his job relocated. He still has 8 months left on his lease and he wants to break it. My initial reaction is to charge a three month rent break fee. I was just curious as to what other landlords generally charge in this type of circumstance. Any feedback would be much appreciated. Thanks in advance.
Check your state's landlord - tenant laws. Typically, job relocations are an acceptable reason for penalty free lease breaks.
That's a great starting point and I am in Georgia which does not have a provision allowing tenants to break leases for job relocations.
If the law or the lease doesn't address it, I would make him an offer to try to re-rent immediately, with him paying his normal rent until it was rented, or a decent penalty that he should be able to get his job to pay. Why should the property owner have to suffer because he chose to rent? If he owned, he would have to sell the place or carry the mortgage. Any reputable company covers those costs for non-voluntary transfers; if he just wants to transfer for a better job, he should bear those costs.
@JD Martin : I was thinking along those same lines when I suggested a three month lease break fee. Is the three month fee reasonable compared to what you or others you have seen are charging?
The tenant has to make an effort to find another tenant for you to take over his lease. If not, and he can't find a suitable tenant that YOU APPROVE OF, he is responsible for the balance of the lease.
It depends on Georgia law and also what it says in your lease. It probably says in the lease that you can keep his security deposit (but look and see don't just assume it does) and you can probably charge him for the rent for the time it is vacant however you probably CAN'T charge him for any time there is another tenant there. So unless it is vacant for 3 months you probably can't charge him for 3 months but check Georgia law because I only know for sure that in Texas you can't ever charge 2 people rent for the same property.
Originally posted by @Stephan Nemeth :
@Jd Martin: I was thinking along those same lines when I suggested a three month lease break fee. Is the three month fee reasonable compared to what you or others you have seen are charging?
On 8 months remaining, I think that is reasonable depending on your market and what it takes to get it ready to re-let. If the guy is easy to work with, pays without trouble, and leaves the place nice, I'd refund anything that wasn't applicable if you got it rented.
You can keep deposit plus 60 days of rent in most cases for Georgia. If he or you gets someone on there sooner then you can only charge for actual amount of loss but also still full deposit would be owner's as well.
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