What is an early termination clause in Florida residential lease? If you’re and agent reading this, you need a new broker. If you’re a customer reading this, you need a new broker. Call me, Chris, at 561.626.8550. So, should we agree to an early termination fee? The paragraph at the end of the STANDARD contract looks like this…
Early Termination Fee/Liquidated Damages Addendum
[ ] I agree, as provided in the rental agreement, to pay $ ____________ (an amount that does not exceed two months rent) as liquidated damages or an early termination fee if I elect to terminate the rental agreement and the landlord waives the right to seek additional rent beyond the month in which the landlord retakes possession.
[ ] I do not agree to liquidated damages or an early termination fee, and I acknowledge that the landlord may seek damages as provided by law.
Early termination fee means any charge, fee, or forfeiture that is provided for in a written rental agreement and is assessed to a tenant when a tenant elects to terminate the rental agreement, as provided in the agreement, and vacates a dwelling unit before the end of the rental agreement.
IF the Owner and the Tenant do agree to an early termination fee then be advised that this early termination fee does NOT include the following items which the Landlord MAY attempt to collect, aka sue for:
(a) Unpaid rent and other accrued charges through the end of the month in which the landlord retakes possession of the dwelling unit.
(b) Charges for damages to the dwelling unit.
(c) Charges associated with a rental agreement settlement, release, buyout, or accord and satisfaction agreement.
If the Landlord/Tenant do NOT agree to an early termination fee then what are the “damages as provided by law” that the Landlord may seek?
First, the Landlord must exercise good faith in attempting the re-lease the property. They must take steps to minimize the amount they are collecting. However they may seek:
Missed rental payments.
Any difference between the amount due for the balance of the rental term and the amount realized by the Landlord for that period.
Any fee to re-lease the property. This is typically one months rent with 1/2 to the listing agent and 1/2 to the agent who represents the Tenant.
Any utility expenses which were the responsibility of the Tenant during the time the unit was vacant.
Legal expenses incurred in collecting any amounts due.
Let’s say the rent was $1000/month with 9 months to go. The Tenant was responsible for paying the water ($50/month) and electric ($100/month)
The Landlord hires a Realtor to re-lease the property and after 2 months vacant finds a tenant to move in at a new 1 year term at $950/mo.
The Landlord could seek 1) Legal Fees. 2) Court filing costs. 3) $2000 for the 2 months the unit was vacant. 4) $950 (1 months rent) paid to the Realtor(s) for a re-lease fee. 5) $350 for the 7 months at $50/month less rent for the $950/ vs $1000/month rent 6) $300 for the 2 months of utilities.
