Finding out your tenant will be leaving before the end of a lease can create understandable frustration. Unfortunately, though, this type of situation does come with the territory of being a landlord. There is a myriad of reasons why a tenant may choose to break a lease agreement early; even the best tenants may encounter unforeseen circumstances that require them to relocate sooner than they originally planned.
As a landlord, you can protect yourself against the financial loss associated with early lease termination by carefully planning ahead in anticipation of the worst-case scenario.
3 Powerful Tips For Minimizing Loss When Your Tenant Breaks The Lease Agreement
1. Include An Early Termination Clause In Your Contract
You can customize your lease agreement to outline specific requirements and conditions that must be met before a tenant is relieved of his or her legal obligations. Many landlords, for instance, will require the current tenant to find another eligible candidate to take over the lease prior to moving out.
You may also require tenants who break a lease early to forfeit their security deposit as a way to make up for any lost income. Since this may not amount to very much, though, you may also decide to include a clause in your contract letting the tenant know that he or she will continue to be responsible for paying monthly rent until you’re able to find a new tenant.
2. Find Out Why Your Tenant Is Breaking The Lease
It’s important to determine whether or not your tenant is acting within his rights by ending the lease agreement early.
Believe it or not, there are certain circumstances under which a landlord cannot collect penalty fees from a tenant who breaks a lease contract. For example, tenants who serve in the military and are forced to relocate or deploy have the right to break a lease legally with written notice. It’s also perfectly legal for a tenant to break a lease if the home is in “unlivable condition.” This reinforces the importance of properly maintaining your rental property; not only would it be unethical to rent out a home in poor condition, but doing so could inevitably hurt your income as well.
Make sure you’re familiar with the landlord/ tenant laws in your region if you’re considering taking the former tenant to small claims court, as you could be surprised to learn that your tenant is acting within his or her rights.
3. Start Searching For A Replacement Tenant ASAP
Regardless of whether you’re considering taking your former tenant to small claims court or not, once you’ve received confirmation that your tenant is moving out early, every second counts.
Start working to market the home so interested renters in the area know it is (or soon will be) available.
As you know, you’ll need ample time to screen prospective tenants, so avoid wasting time listing the rental. If you work with a property management company, make sure they’re aware of the situation and ready to assist you with finding a new tenant.
Are You Looking For A Property Manager To Assist With Your Rental Home?
Over the years, Intempus has created a strong reputation as a top property management firm, thanks to our unbeatable dedication to client satisfaction. We’ve worked with hundreds of property owners to take care of their rental homes and protect their investments.
From screening new tenants to maintaining property to providing detailed monthly financial reports, Intempus is happy to help you make the most of your income property.
For more information about our outstanding property management services, please contact our friendly staff today!
