Breaking a lease with my tenant in Arizona.

6 Replies

Hello,

I received a cash offer on my home in Tucson, AZ that I am ready to accept. However, the lease agreement I have with my tenant is not up until November of this year. Any advice on what I can/should do? 

I purchased this property in October of 2016 with an FHA loan. Will I receive any kind of penalties for selling too soon?

Thank you!

Originally posted by @Alex Cifelli :

Hello,

I received a cash offer on my home in Tucson, AZ that I am ready to accept. However, the lease agreement I have with my tenant is not up until November of this year. Any advice on what I can/should do? 

I purchased this property in October of 2016 with an FHA loan. Will I receive any kind of penalties for selling too soon?

Thank you!

Unless there is a pre-payment penalty of 3 years or more on your loan, you should be fine.

Short term capital gains are for 1 year or less so you should be fine for taxes.

The lease would still be valid and the new owner would be taking it over. If you want to break the lease, then you need to work something out with the current occupant. Selling the house doesn't invalidate the lease, it's valid for its previous duration.

Lease will still apply, the tenant will just send checks to new owner and you would probably need to figure out what exactly to do about the deposit. The tricky bit might be if the buyer requires unit to be vacant (required if FHA or VA loan), in which case, you could offer tenant cash to leave early.