One of my tenants wants to move out 6 months prior to the lease ending. What is a fair agreement on what the costs should be if I allow him out of the lease?
Tenants agree to fixed-term lease contracts in order to get a lower rent for the residence.Month-to-month rent is normally higher than a one-year contract because a fixed one year lease means the landlord has a year of guaranteed rents without the expense of finding a new tenant, doing the full cleaning only after a year rather than after each short-term tenant moves out.So your tenant leaving six months early means an extra expense for you to find another tenant, prepare the rental contract, do another walk through, etc., etc.For that, you deserve some compensation.Legally, the tenant committed to 12 months’ rent (in return for a lower rent). You want to be a good guy, and it also seems fair that you require that the tenant be on the hook until you find another tenant, ideally as soon as possible after the current tenant leaves. Plus the cost of finding this new tenant (if you have to pay a realtor fee).We’ve never been so hard-ass as to require the full contracted rent if it can be avoided. So, be nice. Tell them you’ll advertise and start looking for a replacement tenant immediately, and with any luck you can find a replacement before your present tenant leaves.DO NOT let the tenant use the Security Deposit as the last month’s rent - you need that for when you do the walk-through of the condition of the apartment at their departure. If I were you I’d immediately go to the apartment to check it out well before they leave, just in case.DO NOT let the tenant find a replacement without your meeting such a replacement, and have all the normal applications, background checks, etc. If you have your own Realtor who does this work for you, then insist that the realtor will do the finding of the replacement, etc., same as when this tenant applied to live there.In our second year of being a landlord we had a tenant call us to tell us he was leaving in a week to … “travel the world” (or some such). But we shouldn’t worry, he found a replacement tenant. Right. Not. He could not understand why he didn’t get his security deposit back. And he was gone.We learned our lesson after that - make sure you have the current tenants’ new address and ways to reach them.