Does Anyone Use Early Termination Fee

Question

In North Carolina, landlords are required by law to find a new tenant if an existing tenant decides they wish to break the lease for any reason. The existing tenant is only required to pay rent for the time before a new tenant is found. There is a benefit for me as the landlord in that there is zero vacancy. However, it seems more and more tenants are breaking leases and then I must make the effort to find new tenants. I am generally ok with this as again, zero vacancy, but, some tenants are breaking the lease after only a few months on a year lease. Does anyone know if I can include an early termination fee? If so, is there a limit on the amount?

John Underwood · Answer

@Curtis Mears breaking a lease is breach of contract. My lease specifies that if they break their lease they loose their deposit and are responsible for the remainder of the lease or until I re-rent the property. I have always been able to re-rent within days of someone moving out so this has never been a big deal. I wouldn't bother with trying to go after a renter for the rest of the lease as most of these people have no assets and I can't garnish wages in SC.

I do usually keep their deposit if they break the lease.

John Underwood · Answer

Sarah,

No I have never had an issue with keeping a deposit when someone breaks a lease.

Sarah B. · Answer

@John Underwood I know this is an old thread but I came across it searching. I’m wondering whether you’ve ever had problems with this? I had tenants break a 2 year lease after 9 months. Rent is $2600/month. My lease states that early termination of the lease will result in a $4500 re rent levy.  I was able to quickly re rent the home but it did take a lot of time, effort, and expense (I live across the country). I did not charge the full amount but did retain their $2600 deposit and now they are angry.  Have you had anyone come after your for the deposit you’ve retained in this case?