breaking your lease
We recognize that events occur that require you to break your lease. We are sorry to see you go (provided, of course, that you pay our rent on time, take good care of the property, and (should you have a pet) scoop its leavings on the lawn), but recognize that sometimes no other option exists and that a lease break is necessary.
Of course, when you break your lease unexpectedly, it places a financial hardship on us - we've made plans based on your initial promise to fulfill the lease. For this reason, we will ask for a break lease fee. There is no break lease fee in the lease; instead, we determine a break lease fee at the time when you break your lease. Typically we ask for 1.5 months of rent as a break lease fee.
While the break lease fee appears costly, remember you are legally obligated to pay the balance of your lease and we can keep your deposit if your lease terms are not met. If we do not work out something to settle your contract, we transfer your unpaid balance out of our receivables and into the hands of collection agency and this amount is typically greater than what you'd pay as break lease fees. It is important to remember that unpaid balances to a landlord are almost always an immediate disqualifier when getting a new apartment or home loan.
Here's our thought process in different scenarios should you break a lease:
- You are buying a house. If you use a Barnett & Hill real estate agent as your buyer's agent, we will use the commission from the real estate transaction to fund your break lease fees. You would owe nothing - the break lease fees are deducted from the commission the seller agreed to pay before the transaction took place. Contact one of our real estate agents to explain this further if you plan to buy a house.
- The apartments are full and we have no vacancies. In a case like this we may negotiate a minimal break lease fee - maybe $100 to cover the cost of cleaning and touch-ups. We can forgo the revenues you provide us, because of our occupancy.
- We have several vacancies across our properties. In these cases, we typically ask for the 1.5 month break lease fee.
- We have multiple vacancies and it is an off-season - e.g. it is difficult to rent a 2 bedroom apartment or a 4 bedroom house near HSU in a college town in January. In cases like these, we may ask for a two to three month's rent break lease fee.
Oftentimes, we will factor your deposit into the break lease fee. This means an apartment that rents for $400 would likely have a break lease fee of $600, but we'd credit the $150 deposit to the break lease fee bring the amount you'd have to pay at the breaking of your lease to $450. This depends on your past payment history and the cleanliness of your apartment - if you keep a messy apartment and pay your rent late, we won't extend this courtesy - we assume we need your deposit to clean up the mess you left us in your apartment.
If you do break your lease, it is helpful to find someone to take over your lease. Remember - you cannot sublet your apartment - all prospective tenants must pass through our office so what we can perform a credit screening and background check on them - we want to ensure they can pay their rent and that no criminal element is allowed to live on this property.
If you want, we can discuss your break lease fee when you sign your lease. Typically, we ask for a 1.5 month break lease fee at leasing signing and make it part of your lease agreement. If we don't, we work it out as the need arises, put it in writing and move on down the road.
Breaking your lease does not damage your relationship with us - we have given good recommendations to tenants that have broken their lease, provided that we can mutually agree to terms for breaking the lease. The best thing to do is have a conversation with us so that we both understand what is going on and make plans.