Tenants want to move out.

58 Replies

Hello everybody,

Our tenants all of a sudden decided that the house they rent from us and loved, is no good for them anymore, and after sharing with us that the floor (laminate) is still "bubbling" (after we fixed it) which is bothering them now more as they work from home during pandemic, the walls are too thin and they can hear other being on the phone even though the doors are closed, and that their realtor friend found them many great option to buy their own house, our tenants without actually announcing that they want to move out, asking me 5.5 month in to their yearly lease, "what are our options?". I am surprised they even consider that there might be any, with their lease is being only for 1 year and it's 6.5 months left until they either renew it or give us 60 days move out notice. Their rent is $1800. In a lease we have a $3600 break lease fee + 60 days move out notice and they still responsible for these remaining 2 months rent, which start on a date when the $3600 are received and a written notice about their intention to move out was provided.

Since the very start I accommodated them on number of things: we agreed on direct deposit and they did it only for 1 month, then said it doesn't work with their bank and asked me if the check would be acceptable, so I agreed to be driving to the bank myself every month depositing their rent checks (no big deal, it was worth for having good tenants). Then they were late on 2 occasions with their rent payments, I didn't assess them a late fee, I let it slide. Then we've jumped to attention each and every time they had concerns about the property. At last but not least, there is a dog only allowed in their lease. They got rid of a dog that they had, and asked me if they can have a kitten. So... once again, good tenants, we didn't want to loose them and I agreed, still having concerns about cat's urine on the floor. And now, few months later, they are letting me basically know they want to move out at all, with no regards to their lease... I was disappointed that they do not even recognize any responsibility that they have after signing the lease, and are not willing to pay for both (rent and mortgage), since they want to buy a house. They want out of the lease, but don't want to pay for it. They also talked something about many people moving out of the city, which was irrelevant and has nothing to do with them and their lease or us.

Of course, this time (for the 1st time) I told them "You are welcome to not to renew the lease, but, no, you would still be responsible for the rest of the lease payments, should you decide to move early, regardless of when you want to move, before May 1st, 2021". I am trying to hold them to their commitment that they've made. But they were disappointed to hear "No" from me, because they used to get their way all the time before, and seems that they expected to push us again and as far as they can. I don't even know in what condition the house is right now after they got a cat... 

Now, after all this, I wonder how to handle it properly with accordance of local State laws and regulations? How to respond to them when it is in writing? What rights do we have as Landlords, and does this signed lease even mean anything (it's a residential standard lease offered by an attorney)? Our preference is "no subleting" and it is in their lease too that they signed, it's so random people wouldn't trash our property. Needless to say, to try to rent the house going in to winter will be challenging. Also, is there a proper closure that I have to do with them when the time comes, certain steps that we should follow? The property is in Lake County, IL. 

Any suggestions are welcome and would be appreciated. 

Thank you!

@Kate Koeller

I can’t speak for your local laws but my two thoughts:

1) as long as they pay you, they can move out. You still need to be paid though. Make sure they understand that you have a legal binding contract for housing services and that goes above what either party wants. You can’t just change the locks anymore than they can just stop payment.

2) If they really are bent on moving out, they can. Amend the lease. (Which changes your legal contract and should be allowed.) pick terms in your favor, such as an extra move out fee, and that they will continue to pay the prorated rent weekly until the unit has new tenants moved in. This way they get what they want and you do not miss rent. (Please note I have never done this myself but heard it along the way in a similar situation.)

Finally, don’t bend over backwards as much initially in the future. 😀They definitely think they can take advantage of you.

Just say no.  You're running a business. Communicate like a business owner - something like:

"As you know, your lease is for a term of one year with 6.5 months remaining on it.  Your contractual options, per your lease, would be to honor the lease for the remaining term or provide 60 days notice and pay 2 months rent representing the early termination penalty."

I would only respond in writing so you have a record of what was said and you cannot be misinterpreted.  

And, do yourself a huge favor, and manage to the lease. Don't do favors, don't waive late fees...do what's contractually right so that your tenants know how you will respond each and every time.

As soon as you say no - that you're enforcing the terms of the lease, they'll find someone else to torment.  Hope this helps...

First things first, you have to hold firm and run your business. Nice guys (and gals) tend to get taken advantage of and often finish last. Be firm but fair. You cannot give into people because you want to avoid conflict.  

Try to settle on a buyout number. If they break the lease anyway, you can pursue a judgment and would more than likely win, but good luck collecting that money. You can report it to credit bureaus and hit their credit and hope that is incentive enough for them not to just get up and leave without paying.

@Patricia Steiner

Thank you!! This definitely helps, especially with how professionally you worded it. I WANT to stay professional, as we DO run a business. It is a learning experience for us and we indeed shall no longer let "nice tenants" take advantage of us in the future.

@Bob Okenwa , Thank you for your input! You are absolutely right. I will keep in mind that incentive should I ever have to bring it up to them. Hopefully it won't get to it, but I'll keep enforcing the lease and like Patricia advised, will do it in writing.

What makes them good tenants??  They were late twice in 5 months (40% of the time). You set up a process for rent collection and they changed it.  It sounds like they do alot of complaining and they are not even halfway through the lease?

Keep in mind you set the tone and when you waived late fees I think they assumed you would also waive the termination fee. Just say no. If there is something wrong you fix it that is your responsibility as a landlord. Paying on time per contract and keeping the place decent is their responsibility. There is a termination clause in the lease that is their option. Let them know that is their only option. Enforce any future late fees. I don't mean to be critical but you have to understand as other have said you are running a business and they will push you as far as you will go.

How to handle the situation is a legal question.  You need qualified legal advice.

You need to speak with an experienced landlord tenant attorney who can read your lease and advise you on your options, given your state and local laws.  You'd be surprised at what aspects of the landlord tenant relationship are regulated and laws vary widely.

I would advise you to retain your own attorney to also prepare your next lease.

A lot of landlords don't want to pay an attorney but you can have serious problems if you aren't doing things correctly in your jurisdiction.

@Kate Koeller

Well they could just leave and all you have are their prepaids.... so there’s that.

Not sure about your state but in PA if they break the lease and move we have to mitigate damages by marketing for a new tenant. They are still responsible for paying until then but we can’t just sit on our hands. Your lease break clause would never fly in front of the judge around here.

And why are you not assessing late fees? Why drive to the bank instead of mobile deposit? Hobby or business.

Tenants move.  You cant stop them.....  IMO you have to mitigate their damages, which usually means you must work diligently to get a new tenant.  so, say they want to move at end of November - you would work really hard to rent it out for that time frame.....  your locale may have specific language... or your lease may have a buy out clause...  either way let them move, with good will....  there is no benefit to making it ugly. 

ETA - pretty easy to find the relevant laws for Illinois "If you don’t have a legal justification to break your lease, the good news is that you may still be off the hook for paying all the rent due for the remaining lease term. This is because under Illinois law (735 Ill. Comp. Stat. § 5/9-213.1), your landlord must make reasonable efforts to re-rent your unit—no matter what your reason for leaving—rather than charge you for the total remaining rent due under the lease. So you may not have to pay much, if any additional rent, if you break your lease. You need pay only the amount of rent the landlord loses because you moved out early. This is because Illinois requires landlords to take reasonable steps to keep their losses to a minimum—or to “mitigate damages” in legal terms."

https://www.nolo.com/legal-enc...

@Max T. , it is a business for us, sure. Otherwise we wouldn't gotten in to it. Just trying to be a perfect Landlord. I guess this is a mistake that I'm learning from our most recent experience. Thank you for your opinion, Max!

@Colleen F. , you brought up ALL thr great points. My gut feeling is telling me the same about perhaps making a mistake by waving those late fees, though it was only on 2 occasions and by few days to a week (that's what prompted me to wave the late fees) for the past 1 year and 6 months. I wonder if I'm still allowed to subtract it out of their security deposit after their moving out date?

@Kate Koeller

There was a good video by Steve Rozenberg, "What I wish I would've know about being a landlord" you should check out, if you haven't.

Some good highlights are:

The lease is a bilateral contract. There are set rules that they, and you, must follow, ie, if they do something wrong, this is the repercussion. In a sense, you broke your own contract by NOT fining them.

He brings up another good point of, if you let late fees slide for one tenant because they are good tenants but fine other tenants for the same reason, that could be seen as discrimination or a fair housing violation.

Had just watched that video so it seemed relevant :)

Best of luck!!

In the future consider putting an Early Lease Termination fee in your lease. It takes the emotion out of situations like this when everything is black and white written out on a lease. 

@Kate Koeller   for late fees I always let them know they are late regardless of If I can impose a late fee. In RI I can impose a late fee after day 5, in MA it is only after day 30 (can you believe that!)  so check local law. I wouldn't leave it for the security deposit time. Just invoice when it happens.

@Kate Koeller I would go by your lease agreement when it comes to breaking your lease and let them move out.

When it comes to doing favors for tenants and them remembering what you did for them ...9/10 times most will still put their needs/wants first.

@William Frodge , thank you for yoir suggestion. I'll watch this video. Before they move out though, since we have their security deposit, can we still assess those 2 late fees in an amount of 5% of their monthly rent, by subtracting them of their security deposit, per our lease contract?

@Michael Noto , thank you for pointing that out. We actually DO have this provision in our lease (in a Rider A, last page), which they signed (initials on every page and signatures on the last page of the lease and signatures on Rider A). So, break lease fee, as per our lease agreement, in an amount of $3,600 is to be paid in an event if tenant moves out before May 1st, 2021, upon written 60 days move out notice. The 60 days start on the day when $3,600 break lease fee is received. And they still responsible for the remaining 2 months of their rent payments, plus any unpaid fees as per our contract, plus they are responsible to pay for damages out of their security deposit should there be any. So if it is allowed by law, I am intended to assess those 2 late payment fees plus break lease fee in addition to any money subtracted from their security deposit for damages, if any. It may not be enough of their security deposit to cover it all, but I will enforce the lease (otherwise what else is the purpose of it?), if we have to, we will subtract what we can and cut our losses; we won't just sit back, instead I will work very diligently and do everything I have to do as a Landlord to do a proper closure with the existing ones and find new tenants as soon as it's required by law.

Here in California your early termination fee/charge would almost certainly be deemed an illegal liquidated damages provision under civil code section 1671(d) and you would be required to mitigate damages by diligently re-letting the premises.  I would be very surprised if you got a different answer from a lawyer in deep blue Chicagoland.  

Originally posted by @Kate Koeller :

@William Frodge, thank you for yoir suggestion. I'll watch this video. Before they move out though, since we have their security deposit, can we still assess those 2 late fees in an amount of 5% of their monthly rent, by subtracting them of their security deposit, per our lease contract?

 you really ought to read the tenant/landlord laws for your jurisdiction....  otherwise you are playing a game without knowing the rules....  maybe the tenant does not know them either, but if they do you may get sued. its pretty easy to find the info - google is your friend. also suggest training put on by your local rental owners associations.....

Originally posted by @Kate Koeller :

@Jaquetta Turner, it sure seems so. There IS an option for early termination in a lease. I will word it as Patricia advised, and refer them to this option, should they want to break the lease.

 again, you MUST mitigate damages....  you dont get to charge your lease break fee unless and until you diligently try to release the unit and are unable.  I personally have only had one time where I could not release a unit in short order.