Early Lease Termination

EARLY LEASE TERMINATION IN FLORIDA:
FOR LANDLORDS

Early lease terminations are addressed in Florida Statutes of Landlord/Tenant law. Check your lease first, as this is one of the main clauses included in most residential lease agreements. Typically, Florida leases will specify either one or two month’s rent as the penalty for an early lease termination. This amount would be in lieu of a penalty covering the remainder rent owed for the lease. Does your lease specifically address your situation and there is a clear remedy? If not, you’ll need to look to the Florida statutes.

Remember, a lease is binding for both the landlord and tenant. Generally, an early lease termination requested by the landlord is the same as if it was requested by the tenant. Either party would be responsible for paying the early termination penalty, if there is one outlined in the lease, or if there are no other specific provisions that would factor in.

The best way to avoid costly penalties due to early terminations is to make sure the lease or addenda addresses it specifically and with remedy. Situations like these can become contentious and costly to both parties.

IF your lease does not specifically include a clause or addendum addressing an early lease termination penalty… we highly suggest seeking the advice of an attorney to draft the correct termination notice for you to fit your specific lease/situation… and to conclude any damages (and possibly an offer to your tenants) you would be responsible for paying out.

What if the LANDLORD wants an
early lease termination in Florida:

It will be necessary to outline the exact reason for the termination, and to make sure you are handling it legally. We advise seeking the advice of an attorney to ensure you are serving the correct notice, and handling any penalties or damages correctly. The type of Termination you give, will depend on the term of the lease. Is it month to month? If an annual lease, how many months are left? Is the tenant in violation of the lease?

FLORIDA EARLY TERMINATION
[83.56 Termination of rental agreement]

The above statute will give you the wording needed to send the legally required notice to your tenants. Depending on your tenant and/or the situation, it is quite possible they don’t move-out or respond to the Notice. In that case, it will be necessary to seek the assistance of a good real estate attorney, or file for an action with the local court system.

Make sure you check your lease regarding legal costs and who is responsible for their payment. It is often most cost effective and efficient to hire a good, experienced attorney that deals with lots of Landlord/Tenant Law. If a party is found to be in the wrong, they could be held responsible for paying not only damages, but legal fees for the other party involved.

Landlord wants to terminate
a month to month tenancy

If the lease term began as an annual lease, and became month to month, and the tenant is otherwise not in violation of the lease… the landlord can give a 30 day notice (or 60 to be more accommodating) which would in most cases be plenty of time for the tenant to find a new place to live. The landlord would not owe the tenant any damages. The tenant would still need to pay last month’s rent. But if the landlord wants to be generous, wants to make sure the property is left in the best condition possible, and wants to avoid any issues… its common for the landlord to offer the tenant a bonus to move. Offer to give them $500 or 1/2 month’s rent to move out IF they leave the property by the termination date, hand over all keys, and leave the property in clean condition with no damage and with no unauthorized alterations. Most of this extra accommodation isn’t required, and every landlord/tenant relationship and lease is very different. But most experienced landlords know that avoiding possible conflicts with tenants is the key in avoiding costly pitfalls.

TENANT wants an Early Lease Termination:

You counted on your tenants being there, helping you pay the mortgage or giving you the income you need for each of those remaining months in the lease.

You’ve now got to deal with a vacancy and possibly another real estate commission to pay out. What can you do if your tenants move out early?

Good news! A couple of years back, the State of Florida enacted the Early Lease Termination Bill. You can now have your tenants sign an addendum which gives them a choice: pay liquidated damages or a termination fee.

First, understand that without this addendum/clause in the lease… you as the Landlord have three options:

1- Retake the property and terminate all further tenant liability

2- Retake the property, re-lease to new tenant, and hold previous tenant liable for the rent not paid in-between those tenancies or

3- Sue the tenant for the lost rent!

If you take advantage of the HB 1489 Law… it gives you the benefit that if the tenant skips (moves out early), you can charge liquidated damages. In addition, it is beneficial to the tenant because (if he gives the required notice) he can pay the termination fee without actually considering the move-out a breach of the lease/contract.

What can you charge exactly?

1- liquidated damages OR the termination fee

2- rent through the end of the month when you retake possession

3- any additional monies owed as per the lease: ie utilities

Did your tenant move out early WITHOUT your consent?

The law regarding early lease termination is simple… they owe you money. How much? That depends on your lease! Most leases require a 30 day advance notice. If the tenant moves out before then, they are in DEFAULT of the lease. They could owe a full month’s rent, or be required to pay rent until a new tenant moves in. The law is written to protect landlords from vacancies due to tenants moving out early!!! Of course there are caveats… if the lease is month-to-month, or if the lease has specific provisions included… the amount of money owed could vary.

Do you still need to give them their security deposit back,
if they move out early??

That also depends on your lease! If the lease specifies that early termination means a forfeit of a full month’s lease (most common)… they owe you that much, minimally. In addition to that rent… there could be additional claims on security for any damage, etc. If you aren’t holding enough money to cover the early termination amount owed according to your lease, AND the tenant also owes you money for damages… you can STILL get that money through small claims court, an attorney, or sending to a collection’s agency. You CAN recover the money your tenant owes you!!!

If you’d like to add an addendum to your lease to include this early lease termination in Florida remedy… you must use wording similar to the following:

_______ I agree, as per the Lease Agreement dated ________, between ____________ (Landlord) and ______________ (Tenant) to pay $___________ (an amount not to exceed two month’s rent) as liquidated damages or an early termination fee, in the event I elect to terminate the rental agreement. Landlord then waives the right to seek additional rent beyond the month in which the landlord takes possession.

_______ I do not agree to liquidated damages or an early termination fee. I understand that Landlord may seek damages as provided by the law.

Landlords do not HAVE to use this new Early Termination remedy. The use of it will be determined in large part by the Landlord and the rental market as it is or is projected to be during the tenancy.