Prorating the rent after the lease expires

General Landlording & Rental Properties
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Prorating the rent after the lease expires

Brendan Moore
Investor · Saint Augustine, FL · Member since 2015 · 10 posts · 3 votes

My current tenant's lease ends in a month because they are buying a house. They are not sure when exactly the closing date will be but it could be sometime in the following month after the lease ends. They want to know if they could prorate the rent for the following month. They have been good tenants for the two years they were there so should I say yes or charge them a full month's rent? Any advice would be great. Thanks!

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Kelly N.
Investor · SE, MI · Member since 2013 · 1k+ posts · 461 votes
9y

If you are willing to prorate, charge them the full month's rent, then return the prorated portion after they move out.  That would be doing them a favor- normally when you go month to month, you still give one month's notice that you are leaving.  If you charge them the prorated rent NOW, what happens when the closing gets bumped a week?

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  • Kelly N.
    Investor · SE, MI · Member since 2013 · 1k+ posts · 461 votes
    9y

    If you are willing to prorate, charge them the full month's rent, then return the prorated portion after they move out.  That would be doing them a favor- normally when you go month to month, you still give one month's notice that you are leaving.  If you charge them the prorated rent NOW, what happens when the closing gets bumped a week?

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  • Kim Meredith HamptonBusiness Member
    Real Estate Broker · St Petersburg · Member since 2014 · 2k+ posts · 2k+ votes
    9y

    @Brendan Moore I agree with Kelly, I've had closing change all the time. Charge the full month, then give them back anything/prorated if they vacate before the end of month along with their security deposit. 

    I always hate these situations, how do you know when you can get the place re-rented. Once I had to make the proper leave and stay in a hotel because we had people moving here from another state. Their problem ultimately becomes your problem

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  • Thomas S.
    Member since 2016 · 13k+ posts · 12k+ votes
    9y

    I would charge by the month and not give any rebate. The reality is that they are going to cost you vacancy time and should be held responsible for a full month at a time. You are doing them a favour allowing them to go M2M as opposed to placing your business interests first so in return they need to understand there is a price for the favour.

    Tell them no on the pro rated rent and explain that you should not have to suffer a vacancy loss to assist in their home purchase. M2M is a lease that runes for a month. 

    The only way you would pro rate would be if a new tenant moved in the day after they leave. Why would you be subsidising their home purchase. The fact that they have been good tenants is irrelevant since they are now becoming ex tenants.  

    Your decision comes down to whether you are operating a business or are in this as a  hobby.

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  • Gail K.
    Augusta, GA · Member since 2014 · 1k+ posts · 1k+ votes
    9y

    I agree with Thomas S..  Say you're showing the soon to be empty rental to new applicants.  What do you tell them as to when it will be available?   Maybe on the 10th?  The 15th?  Maybe the following month if the closing gets pushed back even further?

    Gail

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