Four Reasons Why You Should Not Break your Lease
Are you thinking of moving out of your present place for a more suitable one before the determination of your lease? Are you aware that what you are planning to do is called “breaking a lease,” and it has grievous effects? Do you know that a lease is legally binding and its determination only could save you from legal implications when you break it?
The consequences of breaking a rental contract vary from state to state. However, the most common and notable of them is that it would hurt your credit. This article discusses the effects of breaking your lease and ways to break it without incurring costs.
Effect of Breaking a Lease
- Early termination fees: Early termination clause is available in several tenancy contracts. When it is available, it usually comes with a hefty financial burden on the defaulter. The provision often permits tenants to break the lease subject to the payment of the fee prescribed in the contract. The tenants could pay the rent of the building till a new tenant is found. They could also pay either a month or two months upfront payment at the determination.
- Credit score: You should think of your credit score if you are planning to break a lease. Most of the time, the landlords initiate a debt repayment plan in a court via breach of contract. This could then result in a debt judgment which might be reported to the necessary authorities. The debt judgment would affect your credit. It usually takes up to seven years before your credit could be free from any debt judgment.
- Civil Lawsuit: Lease is a legal binding agreement whose breach could amount to a lawsuit. Landlords have the right to take legal action against you if you choose to break the lease. Though you might think you had given the landlord enough notice of 60 days at most, you would still be considered a lease breaker if you do not take the responsibility of the rent payment within the period of notice.
- It becomes hard to find a place: While breaking a lease can be interesting, renting a new home could be a little bit hard. Most of the time, the new landlords often find it important to consider your credit report. Any negative information which ranges from breach of contract, debt or bankruptcy could deny you from getting your rental application approved.
Not every landlord is interested in getting hooked in the hassles of breach of the lease. As a result, they try everything possible to ensure that you are satisfied with your rental or have an avenue to discuss with them in case you are having a problem with the rented apartment.
For your credit sake, you can always break your lease with little or no damage if you are smart with it. You can check through the lease and come up with a valid reason to break the lease. Lawyers and lease-breaking companies are always available to put you through some ways by which one can break a lease. Apart from that, a good understanding of how to communicate and persuade effectively would save you if you choose to speak with your landlord over your intention to break the lease. Your willingness to work with your landlord by bringing in a new tenant or paying for the rest of the lease until they get a new tenant would keep your credit history clean.
So, before you break a lease today, you need to think twice.