fbpx

How Much Does It Cost to Break a Lease?

Breaking a lease can cost anywhere from nothing to several thousand dollars. There are many factors in play, including why you are leaving, whether there’s an early termination clause in your lease, what local laws may apply, and how much time is left on your lease.

Usually, how much it will cost you to break your lease is outlined in the rental agreement, typically in an early termination clause or something similar. That section won’t just say how much the landlord can charge, but also cover any steps you need to take to break the lease.

Laws about breaking leases can vary dramatically. In some cases, landlords may be limited to charging a specific amount, typically based on how much you pay in rent. If that is the case, you may see a flat-fee you’d have to pay for exiting early. However, you could also see a table or a formula, as what you owe may vary depending on how long is left on your lease.

Let’s go over a three common scenarios regarding the cost to break a lease.

Flat Fee to Break a Lease

Many leases include a flat fee to break the lease. In these cases, the cost is typically the equivalent of two or three months’ rent. For example, if you’re rent is $1,000 per month and the early termination penalty is two months’ rent, you’d need to hand over $2,000 to cover that fee. If the fee is three months’ rent, then you’d owe $3,000.

There may be additional costs as well. For instance, if you owe back due or current rent, or have to pay fees to cover any damage beyond wear and tear, you’d owe more than the $2,000 to $3,000 listed above.

Paying Until a Tenant Is Found

You may have to continue paying the full rent until a new tenant is found. If your rent is $1,000, for instance, you’d continue paying $1,000 per month until a new tenant moves in or your lease expires on its own.

Is it the landlord’s responsibility or yours to find a new tenant in this scenario? While some states have laws that require the landlord to look for a new tenant, it’s never a bad idea to look for a new tenant on your own. As long as you’re still paying the rent, the landlord does not have a strong incentive to aggressively search for a new tenant.

To save money, you can even look for a tenant before moving out. If you find a tenant ready to move in as soon as you’re out the door, you might not even have to pay extra at all – more on that shortly.

Paying the Whole Lease Up Front

At other times, the exiting tenant may have to pay for the full remainder of the agreement period up front. In that scenario, you would end up receiving a credit back once a new tenant is found or until the original lease period ends.

For example, if your rent is $1,000 per month, and there are four months left on your lease, you’d owe $4,000. Then, if a new tenant came in after two months, you’d get two months’ rent ($2,000) credited back.

This can be a lot to pay at once, but if you can afford it and are coming up on the end of your lease anyway, it can make sense. Again, it never hurts to find a new tenant ready to go.

How to Cut the Cost to Break a Lease

Even if your landlord has every legal right to levee a penalty for breaking a lease, that doesn’t mean you might not be able to avoid it. Generally, you’ll have to work out an alternative arrangement with your landlord.

The most common way to exit a lease without paying is to find a new tenant that can move in immediately after you move out. Usually, early termination fees are there to offset losses associated with a unit being unexpectedly empty. If the unit never ends up vacant, the landlord may consider the fee no longer necessary. Keep in mind that the landlord still has to approve the new tenant.

Similarly, subletting the unit to another person may work. However, you should only go this route if subletting is permitted. Most leases bar subletting, so this may not be on the table for you.

Finally, you can always try negotiating. If you have a good relationship with your landlord and the reason for moving out unexpectedly makes them empathetic, they may choose to reduce or eliminate any early termination fees.

Just be aware that if you make any arrangement that falls outside of what’s written in the lease, get it in writing. Even if verbal agreements may be viewed as legally enforceable in your state, it can be hard to prove what was agreed to if it becomes your word against theirs. As a result, it’s always wise to formalize the arrangement.

When You Can Break a Lease Without a Financial Penalty

There are situations where you have the right or ability to break a lease without having to pay a dime, no negotiating required. How they work may vary a bit from one state to the next, while others are essentially universal.

For example, any military member with change of station orders is allowed to break a lease at any time, regardless of the state they live in or how long they’ve resided in the rental. Per the Servicemembers Civil Relief Act (SCRA), landlords are not allowed to penalize active duty military members who are being officially relocated at any time. It doesn’t matter if the military member has been there for months, weeks, or even a single day; they can walk away clean.

Additionally, most states allow tenants to leave without financial penalty if the landlord fails to properly maintain the property. Certain maintenance issues can qualify as habitability standards violations if they have a clear and direct impact on safety or health. In that situation, the tenant may either need to contact a health or safety agency or the landlord directly, depending on state law.

A landlord who is regularly entering the rental unit without proper advanced notice (usually 24 to 48 hours) and justification or, in lieu of that, permission from the tenant may be a viable reason for breaking a lease legally and without penalty. Harassment can also fall into that category. However, going this route may require getting a court order, so it can be complex.

Victims of domestic violence may be eligible to break a lease without penalty. The exact laws about the timing for leaving can vary. Further, proof of domestic violence, such as a police report, is often required.

If it turns out the unit is an illegal one, tenants can break the lease without having to pay. State laws in this situation vary dramatically, and sometimes may even require landlords to refund some of the rent the tenant paid during the lease.

There are a few states that do allow tenants to break leases if there is a serious health-related crisis. However, that isn’t the norm. If that is your reason for leaving, then check local law to see if your early termination clauses no longer apply to you.

Finally, if there is no clause in your lease about a penalty for breaking it, you may also be in the clear. While not having some kind of early termination clause would typically be quite rare, it can happen, and that may prevent the landlord from leveeing a penalty.

When Breaking a Lease Will Probably Cost You Money

Outside of the scenarios above, nearly every other reason for moving could incur a financial penalty. Relocating for a job (other than a military change of station), losing a job, getting married, or purchasing a home aren’t legally considered justifications for breaking a lease.

Similarly, no longer liking the unit or neighborhood isn’t enough. Regardless of how the surrounding area or your feelings about the unit may have changed, that won’t get you out of any early termination clauses. The only exception would be if the reason you stopped enjoying the unit qualifies as a violation of habitability standards.

When an Early Termination Clause Is Illegal

Even if you signed a lease with an early termination clause, if what is contained in that clause doesn’t align with local law, you can’t be held to it. The clause would essentially be considered illegal, so you aren’t obligated to comply.

Now, that doesn’t mean the entire agreement is void. Instead, only the illegal clause unenforceable. Everything else within the document that is legal remains in effect.

However, if your landlord included an illegal early termination clause, it may be wise to review the rest of your lease carefully. Check it against local law to see if other segments may be similarly illegal. Again, it’s important to keep in mind that laws vary from one state to the next, and some cities or counties may have additional rules regarding landlord-tenant relationships and agreements. Research your state and city specifically to ensure the standards you are seeing applying to your situation.

What the Landlord Has to Do After You Break a Lease

There are usually rules governing what the landlord must do to get a new tenant, also known as re-renting the property. For example, your state may require that the unit be available for rent and in livable condition. In those cases, if your landlord decided to remodel the unit after you left, you at least wouldn’t be responsible for rent while it’s an active construction zone.

However, their re-renting efforts only have to be reasonable, not exceptional. As long as they go forward in a manner similar to how they always handle finding tenants, they are typically doing enough legally. For example, they may need to use the same criteria when vetting possible renters or advertise sufficiently, depending on state law.

It is important to note that some states don’t have any re-renting requirements. In those instances, the landlord doesn’t have to take any action and can essentially charge the previous tenant for the entire period. For example, Fla. Stat. Ann. § 83.595 states that Florida landlords can “stand by and do nothing, holding the lessee liable for the rent as it comes due.”

Ultimately, it’s important to look at both your lease and local law regarding early terminations. That way, you can determine exactly how much breaking your lease could cost you.