Can I Break My Lease?

A question we’ve received more frequently the past few months is, “I am concerned about my lease payments and it would be beneficial for me if I could somehow get out of my lease.  Is it possible to break my lease?”

Short answer? You may break your lease but you will still owe the amounts remaining.

Long answer? It depends.

The first step is determining why you want to break the lease.  Is it the rental amount?  The term, or length of time, of the lease?  Is it an issue about when rent is due?  Is the issue with the lease at all or is there some other issue causing cash flow problems (such as marketing contracts)?

Pinpointing the issue(s) will allow you to focus your efforts upon: (1) entering into a discussion with your landlord about potential amendments or changes to your lease; and/or (2) reconfiguring your operation to solve the other underlying issue you have identified.

If you wish to approach your landlord, first review your lease (if it is written).  Ensure that amendments to the lease are permitted, likely with the consent of both parties.  Also approach your landlord with a concrete action plan about what amendment(s) the lease you require and why.  Consider outside-the-box ideas, such as a balloon payment at the end of the lease or flexible lease payment provisions.

But if you feel you must break your lease, and the landlord is not open to amending the lease, what can you do?  First, is it possible to find another person to take over the lease?  This is called an assignment of the lease.  Read your lease carefully to determine if an assignment is permitted; it may not.  However, if assignment is permitted, you can assign your lease to another person so that person may take over the obligations under the lease you cannot meet.

Second, attempt to every extent possible to meet as much as possible the obligation.  This means that if you can pay 50% of the rent payment due, do so.  If you are required to fix the fences, do so to the extent possible.   In short, demonstrate a good faith effort to comply with the obligations of the lease.

Third, understand that the lease is a legal obligation.  Absent a legal reason to declare the lease unenforceable, the lease is a contract.  A landlord may utilize a lien or file a lawsuit seeking past due rent and/or other damages.  You may be required to enlist the services of an attorney if you wish to dispute the lien or lawsuit.

The takeaway?  To the greatest extent possible, try to find a solution with your landlord before you must miss a rental payment or are unable to meet an obligation under the lease.  The key, as always, is proactive communication between the tenant and landlord.  The landlord has an interest in finding and maintaining a good tenant; try to be that tenant.


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