Airstud
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Consequences Of Breaking A Lease

Wed Sep 01, 2010 7:36 am

When I got to Minneapolis in June, there were "APARTMENTS FOR RENT" signs blanketing the city. I don't why but things have changed dramatically and at this point, vacant apartments seem to be flying off the shelves - well, so to speak.

It seems I may get into a studio at the lovely Park Glen complex in St Louis Park. It really is a nice property and having an apartment there would be nothing to complain about - especially these days. But it's smaller than the place I had in California!! I moved here to take that big ol' promotion, bigger paychecks on top of a lower cost of living; I didn't expect that would mean having a smaller apartment!!

Well. C'est la vie; and that's what I get for having dragged my feet re the apartment search. The truth is I'd have zero trepidation about taking this place if it were a 6 month lease, rather than 12. (They do write 6 month leases but only with manamagerial approval and she said it's unlikely since there's plenty of demand out there for 12-monthers.)

Breaking the lease is an option of course, you'd have to give 60 days notice and you're also automatically on the hook for two months' rent even if they fill the apartment a day or two after your notice. That's not what worries me though, what worries me is the adverse impact on any future rental applications of mine at other properties. On the apps I've looked at so far there's a box you have to check if you've ever "not fulfilled a lease." Granted it's not the same as have you ever been in bankruptcy or convicted of a felony, but still...

My guess is that a lease breakage would be a minus on an application but that my decent-sized income and ever-climbing FICO score would be pluses; and that those pluses would outweigh the minus depending largely on market conditions.

Am I right about that, or is lease-breakage a bigger deal than I'm making it out to be?
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NIKV69
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RE: Consequences Of Breaking A Lease

Wed Sep 01, 2010 7:54 am

It's a negative but not the end all. As long as you pay the penalty and give the proper notice they will still be a decent reference I would think as long as you paid your rent on time and didn't trash the apartment.
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stasisLAX
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RE: Consequences Of Breaking A Lease

Wed Sep 01, 2010 8:07 am

I have broken leases twice due to job relocations. I provided the property managers with the offer letters from my employer for the new position, giving the location of my new assignment and the expected start date. In both cases, they wanted 2 months rent to break the leases without any negative outcomes. I simply told them to keep the security deposit and paid them one month advance rent and both of them were fine with this. Good luck!
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Airstud
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RE: Consequences Of Breaking A Lease

Wed Sep 01, 2010 8:31 am

Well sure I can understand them being totally OK with it if you had to relocate for a job...if I were to break it'd be just because I'd found a better place. (She said if a 1BR opens up during my lease, I could "transfer up" within the same lease; it's just that I could get a 1BR in Minnetonka or Edina for the same price as the studio in this place.

I guess perhaps I'm thinking too far ahead.
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RE: Consequences Of Breaking A Lease

Fri Sep 03, 2010 11:16 am

The landlord could come after you legally with collection actions and a lawsuit in small claims court to collect money for the "unused" portion of the lease. And that will stay on your credit report for 7 years. A lot of landlords will allow you to trade up since you are still under their roof and are making money off of you.

About collecting money from you for an unused portion of the lease and also collecting money from new tenants of the same place. I don't think this can be done. It's double dipping. If you break the lease the landlords damages are only the months that the apartment remains vacant.

I would try to be nice the the landlord and see if they will let you out of the lease.
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planeguy727
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RE: Consequences Of Breaking A Lease

Fri Sep 03, 2010 1:10 pm

You can always see if the lease allows a sub-let for the time you might not be there. It's a way to avoid breaking the lease and paying the penalty. Some places do it, others have strict no sub-let clauses in the lease.
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sw733
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RE: Consequences Of Breaking A Lease

Fri Sep 03, 2010 1:20 pm

Quoting type-rated (Reply 4):
The landlord could come after you legally with collection actions and a lawsuit in small claims court to collect money for the "unused" portion of the lease. And that will stay on your credit report for 7 years

This all comes down to the wording on the original lease, which is why it's oh so important to read every word before signing (and often run it by a lawyer friend if you have one who will do it for free). Back when I had apartments, I would not sign, no way no how, unless it was air tight wording that there was a penalty for breaking the lease, but if you paid that penalty no further action could be taken by either party. Done and done.
 
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casinterest
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RE: Consequences Of Breaking A Lease

Fri Sep 03, 2010 1:55 pm

Quoting Airstud (Thread starter):
My guess is that a lease breakage would be a minus on an application but that my decent-sized income and ever-climbing FICO score would be pluses; and that those pluses would outweigh the minus depending largely on market conditions.

Am I right about that, or is lease-breakage a bigger deal than I'm making it out to be

Breaking the lease is a sign of bad faith on the term you rented for. You probably got a better price than you would have with a shorter term.

Quoting type-rated (Reply 4):
I would try to be nice the the landlord and see if they will let you out of the lease.

This is the best policy. Try and work it out with them. Also you could try to sublet the apartment to someone else.
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RE: Consequences Of Breaking A Lease

Sat Sep 04, 2010 4:44 am

Quoting planeguy727 (Reply 5):
You can always see if the lease allows a sub-let for the time you might not be there.

I had forgotten about sub-letting. This is pretty common in large cities. But here in Houston, I have never heard of anyone doing it here.
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sw733
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RE: Consequences Of Breaking A Lease

Sat Sep 04, 2010 3:07 pm

Quoting type-rated (Reply 8):
I had forgotten about sub-letting. This is pretty common in large cities. But here in Houston, I have never heard of anyone doing it here.

It happens everywhere...big and small. I have never been to a big city where I have not seen ads asking for sublease.
 
NAV20
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RE: Consequences Of Breaking A Lease

Sat Sep 04, 2010 3:09 pm

Quoting Airstud (Thread starter):
On the apps I've looked at so far there's a box you have to check if you've ever "not fulfilled a lease." Granted it's not the same as have you ever been in bankruptcy or convicted of a felony, but still...

Airstud, a lot of property (especially leasing) is about 'people,' not 'paper.' If you DO find yourself in the position of wanting to break a lease, it would be because you have found a property that you prefer. In that event, your best option might very well be to go to the leasing agent for the first apartment you rented and tell him your problem. If - as you imply - the market is picking up (and, of course, provided that you have been a 'good tenant' in all respects) there's every chance that they would seek to switch you to a better apartment owned by the same landlord, and even waive some or all of the penalties prescribed in the original lease.

Sounds improbable on the face of it; but bear in mind that - if you're right about current market trends - you would represent a tenant who is prepared to pay more money for a bigger place. That would make you a potential 'asset' rather than a liability.   And, again assuming that the market is 'hot,' they'd presumably have no trouble in re-letting the smaller apartment almost overnight to another 'punter,' very probably at a higher rent than you'd been paying.

So don't think that they'd necessarily 'throw the book at you' for breaking the lease. Real estate agents are just that, agents, negotiators - they're not lawyers or debt collectors. If you get to the point where you feel that you must make a change 'soonest,' it would probably be far better (as in most situations) to 'negotiate' rather than 'confront.'

[Edited 2010-09-04 08:18:25]
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RE: Consequences Of Breaking A Lease

Sun Sep 05, 2010 5:58 am

If you are dealing with the person who actually owns the building your chances of being allowed to leave are greater than if your building is owned by some corporation half way across the country and the "landlord" is only acting as their agent.
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