How to Break a Lease Without a Penalty
If you need to terminate a lease early, there's more to do than let your landlord know and start packing. When you sign a lease of some duration, you are legally obligated to pay the rent during that period. If you don't make some arrangements with your landlord, or take advantage of the early termination clause in your lease, you could end up in court, and face marks on your credit and rental history.
However, when you keep in mind that your landlord simply wants to make sure that your unit is occupied so they can continue to collect rent, and if you approach the problem thoughtfully, there are often ways around the expense. Knowing how to break a lease without penalty can save you a bundle and alleviate stress.
How to Break an Apartment Lease Without Penalty
1. Use the Early Termination Clause
Many leases contain an early termination clause that outlines any early penalties or fees for breaking a rental lease, usually a few months' worth of rent. If you pay these fees, you will be able to break your lease without any legal or other penalties.
Consider the timing of your leave as well. If your lease requires you to pay three months rent to terminate early, but you only have two months left on your lease, it might be best just to pay your rent as usual. Whatever you decide, talk to your landlord if you have any questions about provisions for early lease termination in your rental agreement.
2. Know the Legal Reasons For Breaking a Lease
There are ways to avoid penalties and break your lease without breaking the law. These legal reasons to end a lease early can prevent fines and get your landlord on board:
- Illegal unit If your landlord illegally converted empty rooms or an attic into an apartment, breaking your apartment lease is usually penalty-free.
- Noncompliance with local or state housing codes You have legal grounds to get out of a lease if you're dealing with electrical problems, insufficient bathroom ventilation, pest infestations, and fire hazards.
- Violation of tenant rights Failing to provide hot water and heat or ignoring broken windows and other safety issues are tenant rights violations. They're also grounds to break your lease without paying the penalty.
- Military service Under the Service members Civil Relief Act, you can usually terminate lease agreements based on active duty military service.
- Criminal activity on the property Criminal activity helps get you out of a lease, hopefully as quickly as possible, without penalty.
Before you talk to your landlord, look into all the legal reasons you may be able to break your lease without penalty. The more informed you are, the better the conversation will go.
3. Negotiate with Your Landlord
Depending on your landlord, they may be open to negotiating on ending a lease early. For example, if the market value of your apartment has gone up, they may jump at the chance of breaking your apartment lease to raise rent. Similarly, if your apartment has a long waitlist, they may be able to fill your unit quickly and with little financial loss.
If you decide to approach your landlord about breaking your lease, here are some things you can do to have a successful conversation:
- Explain the situation and your reasons for wanting to break the lease early, without going into personal or uncomfortable details.
- Reassure your landlord that you will take full responsibility for the terms of your lease.
- Offer to pay a fee or relinquish your security deposit to compensate your landlord while they find someone to replace you.
- Assist your landlord in finding a replacement. It's always a good idea to reach out to anyone you know who might be interested in your apartment, and offer to put them in touch with your landlord.
- If the reason that you must leave is that you cannot afford rent, suggest to your landlord that you wish to avoid the time and hassle that it would take to evict you by arranging for your leave in advance. Keep in mind, however, that if your landlord does evict you, that relieves your rental obligations once the eviction has been completed.
4. Consider a Sublet (If Permitted)
If your lease agreement allows you to arrange for a sublet, do reach out to have a conversation about subletting with your landlord. Let them know you will be seeking someone to finish out the remainder of your lease. In some cases, like if your apartment has a waiting list, your landlord may even be able to help you find a sublet.
Here are some tips for finding a sublet to take over your lease:
- Sublet.com is a website that will help you with your sublease search, including arranging background reports.
- Offer your sublet a discount on monthly rent, the opportunity to use your furnishings, or some other benefit to help sweeten the deal.
- Check with your landlord about whether the sublet will have the chance to extend their lease once the sublease has ended.
- Perform a background check, or use a service that will facilitate a sublease process that includes background check.
5. Accept the Consequences
Breaking a lease with or without penalties isn’t always possible and could lead to severe consequences, including:
- Lawsuit Your landlord may take legal action and file a civil lawsuit to force you to pay off the lease balance.
- Lowered credit score A judge could issue a credit judgment against you for breaking a lease and show up as a public record on your credit report, which will bring down your score.
- Difficulty renting a new place or getting a loan A lowered credit score makes it difficult to get just about any loan, not to mention a new lease.
When you break a lease, you’re likely to face some kind of financial repercussions. So make sure you can cover your losses.
6. Explore Options with Minimal Losses
Consider options with minimal losses if you can’t avoid a penalty altogether.
- Offer your security deposit Your landlord may accept your security deposit to offset their financial loss and inconvenience.
- Appeal to your landlord’s human side Some landlords may express sympathy for an extenuating circumstance you have, like needing to move for your health or to be near family.
- Understand context The more you know about the tenant prospects your landlord has, the easier it will be to have a conversation about options. For instance, if you know your apartment has a waiting list, or if you know your area is in high demand, politely and gently reminding your landlord that they could have better opportunities if they put your unit back on the market is a great way to show them you're considerate of their situation as well.
With some ingenuity, you may be able to negotiate down the penalty or get out of it altogether.
7. Get Everything in Writing
If you manage to break your lease without penalty, make sure to get all the details in writing. A simple misunderstanding between you and your landlord could escalate to a legal issue.
What Is a Typical Penalty for Breaking a Lease Early?
If you do break your lease early without legal cause or making an arrangement with your landlord, you could be legally responsible for the rent you were required to pay up to the point that your landlord is able to find a new tenant. In order to recover their losses, your landlord will have to take you to court.
Additionally, a landlord may be able to convince the court that you are responsible for other losses they incurred as a result of having to fill your vacancy. Finally, the penalties you face could impact your credit and rental history.
Ready to Move Out and On?
There are solutions if you're trying to figure out how to terminate a lease early without paying the consequences. Exploring your legal options and keeping the lines of communication open with your landlord are your best strategies for success.
If you break a lease, document everything and do your best to mitigate your losses, protect your credit score, and move out on good terms with your landlord.
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Breaking a Lease FAQs
What Is an Early Termination Clause?
An early termination clause is a section of your lease that outlines what fees you need to pay in order to break it. These are common in leases but not ubiquitous. Your first step in seeking to break a lease should always be to check your agreement.
What Is a Month-to-Month Lease?
A month-to-month lease, also known as a short-term lease, is a rental agreement with no fixed end-date. It generally renews monthly until the landlord or tenant decides to end the lease. If you sign a month-to-month lease, you won't need to worry about early termination, as you can usually let your landlord know 30 days in advance when you plan to move out.