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Old 09-28-2005, 06:21 AM
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Default Landlord Tip of the Week

Q: We had a tenant ask us to let him out of a
lease. We don't normally do that. Any
suggestions?<br><br>A:These are case-by-case decisions. There are a number of
considerations.<br><br>Why does the tenant want out?<br>1. If he can't
afford the rent anymore, then you are kind of stuck. In
that case, he is being up front with you and doesn't
want an eviction on his record. Probably the best bet
there would be to just go ahead and cancel the lease.
You might want to keep the security deposit to pay
for some of your loss.<br><br>2. If he is being
transferred, possibly his company will pay for the rest of the
lease. After all, it is their fault he is moving. Many
times corporations will pay expenses for moves in
addition to the normal moving van and new
utilities.<br><br>3. If it is a divorce, see what you can work out.
Ideas on that below.<br><br>4. If he has just decided
that he wants to move, say no, the entire contracted
amount of the lease must be paid. He can move, but it
will cost him the rest of the amount due for the term
of the lease.<br><br>How is the rental market?<br>1.
If it is good, you can probably re-lease the
property quickly for as much or more than you were getting
from this tenant.<br><br>2. If it is slow, you may
have to play a little hard ball. You will have a tough
time re-leasing for the rental amount you were
getting.<br><br>Your responsibility if the tenant moves out before the
lease is up: Try to mitigate the damages, i.e., use
your best efforts to get the place rented
again.<br><br>The tenant's responsibility if he moves out before
the lease is up: Pay the damages incurred by the
landlord.<br><br>If you use your best efforts to mitigate damages,
and it takes you two months to rent the property for
$100 less per month than you were getting from the
first tenant, he owes you the two months' rent plus
$100 times the number of months left in the lease. For
example, say you had a one-year lease for a total of
$7,200, or $600 per month. The tenant moves out after the
first month, January. You cannot rerent until April 1.
($1,200) You rerent at $500 per month. That means nine
months where you made $100 less than the first tenant
was paying. ($900) The total the tenant would owe you
is $2,100, plus whatever it costs you to in lawyer's
fees and court costs to collect.<br><br>Two ideas for
helping both sides<br>1. See if the tenant knows someone
who would like to move into the property. If he has
been a good tenant, chances are his friends would be
too. Just do the checking you would normally do for a
new tenant.<br><br>2. See if you can get the tenant
to offer some kind of compensation for letting him
out of the lease. Sometimes they'll offer more than
you would have gotten otherwise.<br><br>Disclaimer:
Laws differ from state to state. Make sure this is the
law in your state before you proceed with this
advice.
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