How Landlords Can Terminate a Lease
There are many legal grounds for which a landlord may need to terminate a lease agreement. Most lease termination agreements have a provision that allow the landlord, with notice, the ability to terminate if the premises is sold after the move in date, plans are made to renovate the property , or the tenant is in breach of the lease. These provisions give rise to the right to issue a letter of termination.
The most common reason for terminating a lease is sale of the property. The lease agreements often have a provision for 30 or 60 days’ notice at the end of sale or shortly thereafter. This provision is valid and may eliminate the need for the written notice of termination.
Property renovations are also common reasons for issuing a letter of termination to a tenant. Many tenants expect their tenancy will end when renovations are expected to last anywhere from 30 days to up to 120 days and they receive the notice of termination.
Tenant breach usually requires evidence of lease violation. These violations can be minor nuisances to substantial breach such as refusal to pay the agreed upon rent. The most common tenant breaches are failure to pay rent, trashing the premises, performing illegal acts on the property, or violating other substantial terms of the lease agreement.
Key Elements of a Lease Termination Notice
When drafting a termination letter for a lease agreement, certain key elements should be included as part of the termination request. First and foremost, the letter should state the tenant’s name. This is particularly important if there are multiple tenants who are part of the agreement. If you are a landlord and a tenant has reached out to you about terminating the agreement, it’s always best to follow up with the name to make sure you’re both on the same page. Next, include the property address. Make sure to use the official address provided on the lease agreement. This will help prove that you have a binding and legal relationship with the tenant. The next elements to include in the letter are the reason for the termination and the desired termination date. Both of these should be clearly stated in order to avoid any confusion. The reason for termination does not need to be provided if it is not required under the laws of the state where you reside. However, even if your state does not require the reason, it’s a good idea to include that information, especially if you are terminating the lease early. A termination letter should also include the notice period required by law. Depending on your state and the lease agreement, the notice period may be 30 days, seven days, or even three days. Whatever the law states for your particular situation, the important part is to give written notice to the tenant.
Legislation and Notice Requirements
The legal requirements and notice periods vary significantly by state, and the local laws should always be consulted and followed precisely. In some cases, you may need to contact your tenants directly so that further issues do not arise. For example, if you are terminating a lease early, you may need to contact your tenant to discuss deadlines for vacating the premises. Failure to allow a tenant to move out on the date outlined in their lease could land you in some hot water.
Regardless of whether your tenant is month-to-month or has signed a long-term lease, you must provide them with notice. Some states will even go as far as telling you how many days’ notice that tenant is entitled to before you can terminate the lease. It is vital that this notice is delivered once it is written. While served by hand is popular, sending it via certified mail can also satisfy the statutory requirements.
Best Practices on Notifying the Tenant
When it comes to delivering the news of a termination of lease or rental agreement, your goal as the landlord should be ensuring that the message is relayed clearly, without any room for miscommunication and is delivered in a professional and empathetic manner. While you might be terminating the agreement due to serious issues with the tenant or with the property itself, you do not want to give them the impression that you are "out to get" them or harboring some sort of personal grudge. This will only serve to incite further anger on their part and create a hostile relationship with which it will be difficult to deal.
The landlord should deliver the termination news in person if at all possible, as this avoids any confusion that may occur if the tenant hears about it through the grapevine of residents. If you cannot do this in person because the tenant is unavailable, you need to send an official letter detailing the termination, the reason behind it, the consequences of it and the manner of payment the landlord has chosen. Be sure to send it through certified mail so that you can track it and know when it is received.
This letter should be delivered as soon as possible, giving the tenant time to make arrangements for relocation. It should be well-written and free of grammatical errors and typos, as such mistakes could be perceived as the landlord not taking the matter seriously. It should contain the contact information of someone at the property whom the tenant can contact with questions. If you are employing a property management service, they should be the one to handle this communication.
The latter is especially important because there is always the potential for disputes to arise with tenants when they seek to appeal a termination of lease. You need to have clear procedures in place that will minimize the potential for angry confrontations. To avoid this possibility, be sure to put plenty of time between the notice of termination and the actual date when it is effective.
Template and Example of a Lease Termination Notice
While the reasons for terminating a lease may vary, the process detailed above and the notice template can be a useful guide for landlords.
Notice of lease termination template:
[DATE]
[TENANT’S NAME]
[TENANT’S ADDRESS]
[LANDLORD’S NAME]
[LANDLORD’S ADDRESS]
Re: Termination of Lease – [PROPERTY ADDRESS]
Dear [TENANT’S NAME]:
This letter is to inform you that in accordance with the rental agreement and applicable law, I am terminating your lease and require you and anyone else living on the premises to vacate and move out of the property located at [PROPERTY ADDRESS] no later than [DATE OF VACATE].
I would appreciate your cooperation in allowing me access to the property to show it to prospective tenants while you are still living there . In addition, please do not make any changes to the property or remove any of my belongings for my review prior to your moving out so that I may inspect the property.
Sincerely,
[LANDLORD’S NAME]
[LANDLORD’S NAME]
Sample notice of termination of lease:
[DATE]
JOHN SMITH
17777 N. 25th Place
Phoenix, Arizona 85029
Fred Jones
3301 W. Pine St, #145
Phoenix, AZ 85071
Re: Notice to vacate
Dear Fred:
This letter serves as your official notice to vacate the premises located at 3301 W. Pine St. before the end of your lease (November 15) in accordance with the terms of Arizona landlord-tenant law and the rental agreement signed by you on November 15, 2019.
I ask that you vacate and schedule a time to allow me to show the unit to prospective renters prior to the 15th at which time I can review your property and assess the deposit returned to you.
The Repercussions of Incorrectly Terminating a Lease
The very nature of lease agreements requires that landlords strictly adhere to the lease termination guidelines set out in their states’ statutes. If a landlord fails to follow these rules, even if the lease termination is still in response to a breach of the agreement, he or she opens the door for unwanted—and potentially costly—consequences.
A tenant may choose to sue for the unlawful lease termination rather than the breach of the lease itself. A lawsuit of this kind is usually predicated on a claim of constructive eviction, which occurs when the tenant can no longer live on the property because the breaches make it intolerable or unsafe.
Even if the court finds in the landlord’s favor concerning the breach of the lease, he or she may still be liable for the financial costs to the tenant of a constructive eviction and the stress related to the situation. Financial penalties may include the cost of finding a new home, moving expenses and lost wages from taking off work to address the situation.
All of these potential risks can be avoided if a landlord follows his or her states’ statutory guidelines for lease termination. In most cases, the statutory guidelines are more desirable than proceeding with a lawsuit.
Seeking Guidance from Professionals
For landlords who are new to the process or unsure about the law or their rights, hiring a professional is a good idea. Not only will a professional bring experience on things like wording and timing, but they can help you balance your need for speed with the needs of your tenant. As mentioned above, if you could risk the impression of being vindictive by serving a notice before the agreed-upon timeline, a professional may advise you to wait until the tenant is in breach to serve a notice. Finding a professional like Licensed Paralegal for your Toronto eviction process can help you successfully maneuver through this prickly time without running afoul of the law . Depending on the individual situation, depending on the type of client and income they receive from the tenant, the cost may be recoverable as part of the Tribunal hearing process. For example, in cases where grounds have not been confirmed, work can be done prior to service to get information from the former tenant to ensure there are no risks to the eviction process. A good paralegal knows that these issues may cost the client money but reduce the risks for the tenancy and help the landlord keep their community safe.