Break Lease Penalty and Pet Deposit

3 Replies

Hi,

I'm in Oregon. My tenants broke the lease agreement on Oct 31. I would receive one and a half month break lease penalty per Oregon law.  I'm in the process of signing a new lease with the new tenants on Nov 10, but at a lower rent than the broken lease.  Do I still get one and a half month penalty from the old tenants, or just those ten days which the house is not rented, or should be the loss due to the lower rent up to 1.5 month the old rent?  

Also another question, I had a pet deposit with my old tenants. I didn't charge them for the pet rent.  Is the pet deposit refundable or I can withhold the pet deposit?

Thank you so much!

You can withhold the pet deposit only if there is damage.

It is irrelevant that the new tenant will be paying a lower rent, you can't charge two different tenants for rent for the same time period.

I don't view the penalty as rent.  I'd subtract the penalty (if it was outlined in your lease, that is) and any damage from the deposit and move on.

Surprised you are getting lower rent, rents are skyrocketing in SW WA.

@Bing W

You may want to consider changing up your deposit structure in the future so that your pet deposits are eliminated but instead become an increased security deposit.

This can make things more black and white when doing move outs and there is damage to the property that may or may not have been caused by the pet. If, for example, a dog chews through a custom wood door and the cost to replace it is $500, but you only collected $300 in pet deposit, can you tap into the security deposit to cover the $200 difference? As a landlord I would say that you can, but an attorney could argue differently.

It also makes it easier when a pet allegedly dies and the tenants want their deposit back. In that instance we will stop pet rent, but won’t refund back the additional deposit since it is part of the security deposit and we don’t know yet if the pet has caused damage.

Other landlords will do it differently, but this is the system that we’ve come up with over the years.

Thank you so much!  Your posts are really helpful.

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