Tenants talking to landlords about canceling their lease early

Ultimate Guide on How to Break a Lease

There are times when an individual must relocate before their lease ends, such as when moving to a new state or due to a change in financial situation. Moving out before the end of the agreement is known as “breaking the lease.” Read on for more information about how to break a lease and:

  • The potential financial consequences that you can incur from breaking a lease
  • The circumstances that can allow you to break the lease with fewer or no consequences
  • The steps you need to take to break your lease properly

Why Is Breaking a Lease Agreement Risky?

In the U.S., around 43 million households are renters. When renting a residence — whether it is a single-family dwelling, an apartment highrise that features units for hundreds of residents, or anything in between — you are normally required to sign a lease contract. Among other things, the lease agreement spells out how long the landlord will make the unit available for your use and the date upon which you are contractually free from paying rent on the unit.

Yes, people do break leases on a regular basis, and, no, you’re generally not going to go to jail for doing it. However, there are a number of potential consequences for the renter who breaks a lease agreement, including the following:

You Could Find Yourself in a Legal Dilemma

While landlords rarely sue their tenants for breaking a lease, it can and does happen. A signed lease is a legally binding contract. There are likely to be provisions for breaking the lease in that contract, and you agreed to those provisions when you entered into the contract. The civil court system is one way a landlord can pursue enforcement of that contract if you later decide to pull out of it without satisfying its provisions.

How to break a lease and avoid this consequence:

Be sure that you have read your lease and are prepared to meet the provisions that are spelled out in the contract for early termination before you break your lease. Pay the fines that you agreed to and leave the unit in good condition.

Breaking a Lease Is Costly

When you enter into a lease agreement with a landlord, you agree to occupy the unit for a specific length of time. Your landlord is in the business of making money through his or her real estate. If the renter decides not to say for the full amount of time specified in the lease, the landlord will want to recoup at least a couple of months’ rent or even all of the rent due for the remainder of the lease. You may also forfeit your security deposit.

How to break a lease and avoid this consequence:

Make sure you consult the part of your lease agreement that discusses early termination of the lease. Also, make sure you understand the related financial penalties. If you don’t know how much you will pay or you have a compelling reason why you can’t pay the full amount associated with breaking your lease, talk to your landlord about the situation. See what he or she has to say about it.

Breaking a Lease Is Hard on Your Credit

Having unpaid fines and other unmet provisions tied to the early termination of your lease can hurt your credit. Also, the amount of debt and some of the details about the fines — such as damage to the home — can show up on your credit report. What this means is that, for at least the next several years, every time you attempt to make a big purchase, secure a loan, rent an apartment, or even apply for a job (in some cases), someone will see this information.

How to break a lease without damaging your credit:

Remember that breaking a lease does not specifically impact your credit score. Failing to pay the debts associated with breaking the lease does. Make sure you pay any fines related to terminating your lease agreement promptly. This will help you avoid having interactions with small claims court or a collection agency on your history.

Your New Landlord Will Likely Find Out

Landlords prefer to rent to individuals who will pay their rent on time and keep the unit habitable. Often they will call on previous landlords as references when an individual applies to rent from them. Even if your previous landlord didn’t take you to small claims court or a collection agency, if you broke the lease without settling up your debt and meeting the provisions for doing so, the reference the landlord at the place you’re hoping to move to next receives will likely not be a good one.

How to break a lease while staying on good terms with your former landlord:

There are justifiable reasons to break the lease, and landlords understand that. If there was a valid reason for breaking your lease and you ensured that you were able to meet the terms of the early termination, you shouldn’t worry about what will be said if your next landlord calls for a reference.

How to Break a Lease: 5 Legally Protected Reasons

A universal lease agreement and a pair of keys

There are certain reasons why an individual might be able to break a lease legally, without facing financial penalties for doing so. However, laws vary from one state to another. So it is important to know what your state has to say about whether your reason is legal. Some reasons that often result in a broken lease and no — or fewer — consequences include the following:

1. Active Military Duty

The Servicemembers Civil Relief Act (SCRA) is a federal law that provides a number of benefits for active-duty military personnel to prevent them from losing money or property due to deployment. One of the provisions of this law is the ability to end a housing lease without penalties if the renter will be deployed for 90 days or more. Additionally, if a person’s spouse dies during the course of active military duty, he or she can also legally break a lease agreement as a result of the SCRA.

2. The Landlord Failed to Make the Rental Habitable

In most states, landlords have to ensure that the property they’re renting is fit to be lived in. It must have running water at all times. It also must be kept in good repair and meet the state and local health and safety codes. They must keep common areas and stock them with trash bins. Failing to meet the general provisions for making a rental property habitable is a breach of contract every bit as much as breaking the lease or not paying rent is. If your landlord breaches the contract, you may have cause to legally break your lease.

3. Provisions for Victims of Domestic Violence

Many states provide protections against penalties for breaking a lease for individuals who have been the victim of domestic violence within the past three to six months. These early termination clauses for domestic violence victims generally require written notice to the landlord within at least 30 days before moving out. Tenants must inform the landlord that the lease is being broken under the state statutes that provide this protection.

4. The Unit You’re Renting Is Not a Legal Apartment

Various state laws determine what constitutes a legal apartment. For example, in New York, the ceiling height of a basement, cellar, or attic apartment must reach a certain height to be legal. All rented units must have windows in each designated bedroom space.

Often, property owners will attempt to rent out space that is not properly zoned or permitted for a residential dwelling. If you discover that the unit you have rented does not meet your state’s requirements for being a legal apartment, you have cause to break the lease without penalties.

5. Your Landlord Trespasses

Be aware that your landlord certainly does have the right to enter your apartment in certain circumstances. Usually, state laws spell out what those circumstances are, and those reasons often include:

  • Entering during an emergency
  • Entering to make repairs to the property or to assess the need for repairs
  • To inspect the property for damage
  • To investigate the premises for violations of the rental agreement
  • Showing the property to prospective tenants
  • Showing the premises to insurance or mortgage companies
  • If the tenant invites the landlord to enter the apartment.

Unless the landlord is invited into the tenant’s apartment, landlords must provide tenants with ample written notice before entering the premises. In most states, this notice is at least 24 hours. Also, the apartment must only be entered during “normal business hours,” which are usually Monday through Friday, from 9 AM to 5 PM.

If you want to know how to break a lease for this reason, start by collecting documentation of infractions. After the first time, you should ask the landlord in writing to refrain from violating the renter’s rights provided to you in state law. Keep a copy of the letter for your own records. Breaking your lease if your landlord fails to provide adequate notice of entry may require you to take legal action. You will likely need this documentation to prove your claim.

Options for How to Break a Lease

In many cases, you can reduce or completely avoid the penalties you face for breaking your lease agreement by helping the landlord to find a new tenant for the unit. There are a couple of ways to do that, including:

1. Subletting

If you sublet your rental property to someone else, they are essentially fulfilling your occupancy requirements that you agreed to until the lease expires. They’re paying you for the rental of the space. You then give this rent to the landlord. Some property owners and managers do not allow this. It is important that you get consent from your landlord before subletting your place.

If your landlord is amenable to you finding someone to sublet the space, you should remember that this does not take you legally off the hook for the rent or maintenance of the property. If the person you sublet the property to fails to pay his or her rent or trashes the place, you can still be held responsible.

Because of this, you must treat the scenario as if you are the landlord.

Pro Tip for How to Break a Lease:

Consider performing a background check and income verification. This will help ensure that the subletter is a responsible person with the financial means to make rent. You should further protect yourself by requiring the prospective resident to sign a contract to sublease/sublet.

2. Assigning the Lease

Many people don’t wish to take on the additional responsibilities of a sublease agreement. Another option for getting out of your lease is to allow the lease to be assigned to someone else.

This means that the new renter will essentially enter into their own lease with the landlord. This involves paying their own security deposit, paying rent directly to the landlord, and dealing directly with them for any maintenance or repair issues that come up. Many times, in order to assign the lease, you will still have to be the one to find a new renter and ensure that this renter meets the landlord’s criteria. Your landlord also must agree to have the lease assigned.

Four Steps for How to Break a Lease

Man reading his lease agreement to see the financial penalties of terminating a lease agreement early

If you need to move before your lease is up, it’s important to not just move out without saying anything to the landlord or move out after having given less than 30 days’ notice of your plan to do so. This will not change your legal obligation to pay rent through the entire duration of the lease. It could also put you in danger of violating other aspects of the agreement. For example, your lease likely requires you to promptly inform the landlord of any needed repairs.

While following the rules of how to break a lease won’t necessarily protect you from all of the financial consequences of doing so, it can certainly help to mitigate some of the damage. Here are five steps to breaking a lease the right way.

1. Read Your Lease Immediately

The agreement you signed when you rented the place should spell out the requirements for early termination. Many landlords can and often do work with their tenants to lessen the hardship that is necessitating a broken lease. But be prepared for the worst-case scenario that you will be expected to pay the penalty listed for early termination of the agreement.

Often, this penalty is two months of rent and your security deposit. However, depending on your lease’s provisions, you could be responsible for the entire amount of rent that you would have paid for the duration of the time remaining on your lease.

2. Submit Written Notice of Your Plan to Vacate, and Talk to Your Landlord

This is a conversation that many people find uncomfortable to have. Remember, though, that it is always better when ending a legal agreement to do so honestly and transparently. This conversation could potentially save you from the worst penalties, such as small claims court or a collection agency. You might even find that your landlord is very willing to help you explore sublet or lease assignment options or provide other assistance.

Landlords live in the same expensive, chaotic society that you do, and they have had their own personal hardships. While not every landlord will work with you when it comes time to break a lease, many will. Time is of the essence when it comes to this conversation, however. The sooner your landlord knows that you are certain that you need to break your lease, the better. They’ll have more time — with your help — has to find a new tenant and avoid the loss of income.

3. Offer to Help Find a New Tenant

Breaking your lease represents a loss of income for the landlord. Being required to take time out of their busy schedules to look for a new tenant on a place they had counted on having occupied represents an impact on a landlord’s bottom line, too. However, if you are willing to help find someone to replace that rental income, you can likely avoid some of the consequences of breaking your lease.

Get everything down in writing and keep copies for yourself. This ensures that you have a paper trail to prove that you properly informed your landlord and made reasonable efforts to follow the directives for early termination. If the worst-case scenario happens and your landlord pursues action against you through court, you will need this documentation to show that you did your part to end the agreement amicably and live up to your legal obligations.

4. Seek Legal Advice

Suppose you’re planning to break your lease because the apartment is uninhabitable, you’re being charged too much, or your landlord has been trespassing or harassing you. In these cases, it is important to talk to an attorney about how to break a lease. Look for a lawyer who has experience with contract negotiation, particularly rental agreements. An attorney can help you understand your legal options and ensure that you break the lease legally.

FAQs About How to Break a Lease Agreement

Are you considering breaking your lease, but you still have unanswered questions? Here are some questions that are often asked about how to break a lease agreement.

I am currently undergoing treatment for COVID-19 and am unable to afford my apartment. Is this a viable reason to break the lease without penalties?

While state laws vary, health issues are not usually included as viable reasons to legally break an apartment lease. However, being unable to afford your rent due to health issues is certainly a problem that your landlord can understand, particularly in light of the current pandemic. Be honest with your landlord about the problem. He or she may be willing to work with you to find someone to sublet or assign the lease. They may even be willing to let you catch up on the missed rent.

What do active military personnel need to do to break a lease for deployment?

To terminate a lease agreement, you must notify your landlord in writing of your active duty or receipt of military orders. For month to month rentals, the lease termination is effective at the end of the month after the next rental payment is due. For a year-long lease term, the termination is effective the last day of the month following the month in which the landlord is notified.

You are required to pay rent only for the months before the lease is terminated. If you paid your rent in advance, the landlord must prorate and refund the unearned amount. They must also return any part of your security deposit that is not used to repair damage you caused to the property.

If I send notice to my landlord that I plan to vacate the property and end the lease early, how do I know that they’ve seen it?

It is always advisable to send your official notice to vacate to the landlord via certified mail. This way, you have proof that it has been received. You should also always keep a copy of such written notifications for yourself in case the details of the letter are later called into question.

I agreed to help my landlord by finding someone to sublet my apartment. How do I do that?

There are many places to find a replacement tenant. First, ask friends and family members if they know of someone who is looking for a place to live. If that does not yield results, look for rental pages or community pages on social media. Then make a post about the rental.

Be sure to clean the rental unit so you can include inviting photos in the listing, and describe its positive attributes. Be prepared to show the rental to those who are interested. Also, do your due diligence by calling references and verifying income to ensure they earn enough to make rent payments.

Once you find the right subletter, plan a quick, organized move out. Moving out with minimal disruption to the property minimizes stress for the landlord and keeps the relationship positive.

My apartment doesn’t have running water. What should I do?

Running water is essential to the habitability of a residential dwelling. If you do not have it, you have two options on how to break a lease:

  • Complain to the landlord in writing and keep a copy of the complaint. Also, keep documentation of any action taken or any additional follow-ups.
  • Contact your local department of health if a significant amount of time has passed without action being taken on the matter.

You can also pursue a legal claim in small claims court and ask to be released from your lease agreement.

While it is certainly preferable to see your lease out to its finish, there are some circumstances in which you have no choice but to know how to break a lease and move out quickly. Doing so properly can help you avoid the financial and legal consequences. It can also ensure your ability to continue being considered a responsible renter by landlords for years to come.

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