Can I Break my Lease If I Buy a House? (2023 GUIDE)

In this ultimate guide, we are going to answer the question, “can I break my lease if I buy a house?”.

Buying a property is one of the greatest and most exciting commitments you can make.

What happens if you find a new home mid-lease? Can you (or should you) break a lease to move?

Read on for advice on ending a lease to buy a house.

Can I Break My Lease If I Buy A House?

If your lease contains a house buying clause, it implies you can end your lease early if you buy a new home and provide your landlord or property manager adequate notice. However, not all leases have a home buying clause.

If your lease doesn’t have this clause, you’ll need to find another way out.

State lease laws vary, thus your options (and repercussions) may vary. Even without a legal basis to quit a lease, you’re usually not stuck in it.

Can you break a lease to buy a house? Next, we’ll discuss ways to break a lease.

How to Get Out of a Lease

First, tell your landlord or property management if you want out of your lease.

Never move out without telling your landlord. Before moving, read your lease’s restrictions on breaking a lease.

Depending on your contract, your landlord may give you a few options, but here are some popular ones.

1. Look for a Home Buying Clause

It’s not true that you can break your lease early if you buy a new property. In most circumstances, closing on a house won’t free you from a rental agreement. Some leases feature a home-buying provision.

If your lease has a house buying clause, you can end your lease early providing you buy a new home if you give your landlord or property manager adequate notice.

Not all leases have a home-buying provision. If your lease doesn’t have this condition, you’ll need to find another way out.

2. You Need to Buy Your Way Out

If you pay an early termination fee, you might be able to buy your way out of a lease agreement. This price often consists of a penalty fee for breaching the contract as well as one or two months’ worth of rent.

Before breaking your lease, give your landlord or property manager sufficient notice. If you don’t give 30 days’ notice, you may be sued and forced to pay the remaining rent until your landlord finds a replacement tenant.

You could forfeit your security deposit even with appropriate notice.

3. Switch to a Monthly Agreement

If you tell your landlord you’re buying a home and need to move, they may switch your lease to a monthly one.

With a month-to-month lease, you agree to stay for a month, not a year.

If your landlord agrees, a month-to-month lease can allow you greater freedom in moving out without incurring extra charges. A month-to-month lease may cost more from your landlord or property manager.

4. Explain the Situation to Your Landlord

It never hurts to attempt explaining the problem to your landlord. If you’re honest with your landlord about your plans to move, you might discover a solution that works for both sides.

If you reside in a high-demand area and your landlord can locate a new tenant fast, they may reduce your lease-break fees. In some cases, a month-to-month lease may be possible.

Keep communication genuine, transparent, and prompt; you never know what your property manager or landlord can do.

5. Keep Records

Whether you’re breaking your lease and paying an early termination charge or modifying your lease, get any modifications in writing and keep them. Keep these vital documents close in case you need them in the future. Getting everything on writing might help you and your landlord stay on the same page.

6. Work with the Seller

Try negotiating if your landlord won’t budge: Sellers sometimes cover closing costs. If this covers lease-breaking fees, it may be worth it.

A seller who needs to sell quickly may seek a lease buy-out. Rarely, a home builder would pay to break a lease early so homeowners can sign a contract.

Whatever you ask, be reasonable. If you’ve previously gotten discounts and enhancements, they may not allow further requests.

7. Ask permission

The best initial action is to request authorization. Make contact with your landlord by phone, text, or email, or arrange a meeting in person.

Your request for early termination won’t be the first one, and your landlord could want to re-rent your property at a higher price anyhow! You want to come up with a plan that benefits both you and your landlord.

For instance, your landlord might be open to changing your lease into a month-to-month arrangement. While purchasing your first home, monthly leases give you more flexibility. Your landlord will increase your rent in exchange for the flexibility to cancel whenever you want.

Converting to a monthly contract can save money, even with higher rent.

8. Find options in your lease

A clause that permits renters to leave their rental before their lease expires can be found in some rental agreements. Your landlords may impose a fee or not at all for the option of early termination. Verify the language of your lease or speak with your landlord in person to discuss an early termination.

Typically, early termination fees are equal to two months’ worth of rent.

The Pros and Cons of Breaking a Lease to Buy a House

Should you violate a lease to relocate early? There are benefits to leaving a rented property for one you own, but breaking a contract can have serious implications.

Pros

Moving into your New Home

Although it should go without saying, being able to move swiftly is necessary in order to make a move on a dream property. One way to do this is to break your lease.

Building Financial Equity

All of us would like to improve our financial security, and purchasing a home is a great way to do so. Renting does not give you ownership, therefore when you pay rent each month, you are not getting a return on your investment.

Other pros include:

Breaking a lease isn’t always expensive.
You can bid on a house more quickly.
Buying a home means building equity.
Potential to earn compensation.
Making the best choice for you.
Moving into your new home
Building financial equity.

Cons

Expenses

If you want to leave early, your landlord could also charge you penalty costs in addition to any unpaid rent. They have the legal right to do this because you did sign a contract promising to occupy the rental for a specific period of time. Additionally, if you break your contract early, you risk losing your security deposit.

Legal Ramifications

If the landlord of the rental property so chooses, they may opt to file a lawsuit against you for breaking a lease early. Even if you win, going to court will damage your credit score, making it harder for you to rent somewhere else in the future.

Credit Score Damage

It may be challenging for you to acquire a new line of credit in the future if your landlord does levy fees and you choose not to pay them. Even while your mortgage application might not be affected, you might run into problems if you need to make other significant purchases.

Other cons are:

You might struggle to rent in the future.
Breaking a lease could damage your credit score.
Your landlord could request payment for the rest of your lease.
Your landlord could sue.
You risk the loss of your security deposit.
You may have to pay fees.

Alternatives to Breaking Your Lease

There are other options besides breaking your lease if you want to buy a property and move quickly. Here are some ways to leave swiftly without breaking a lease.

1. Sublet Your Apartment

Subletting is renting a room or area to a new renter who takes over your lease.

Subletting isn’t an option for everyone because not all landlords allow it. Before subletting, read your lease and talk to your landlord.

If your landlord or property manager agrees, subletting might be a terrific method to avoid living in the space and paying extra expenditures. Just be careful when choosing a new renter.

Even if a new renter pays rent, you still own the lease. You’re responsible if they damage the space or stop paying rent.

2. Ask the Seller to Delay Your Closing

According to the National Association of REALTORS® (NAR), 23% of closings are delayed.

If you’re nearing the end of your lease, talk to the seller and other closing parties about delaying your closing date so you may get out of your lease and into your new home at the same time.

Respect your seller’s time and recognize that this may not always be achievable, especially if you still have a significant portion of your lease term to complete.

3. Re-rening

Re-renting an apartment, a new tenant must be found. In contrast to subletting, they will commit to a new lease and pay their own security deposit. For the landlord, this frequently entails relisting your apartment and displaying the house to potential tenants..

Tips for Renters Who Are House Hunting

It’s hard to predict when you’ll close a property purchase.

Instead of renewing for a year if you’re still house-hunting, chat to your landlord about converting to a month-to-month lease.

Since month-to-month leases give less financial security, some landlords may raise rent.

The extra rent is usually cheaper than an early termination fee if you need to quit a year-long lease early.

Rules for Breaking Your Lease for Each State

Check your state’s renters’ regulations to see how much notice you need to give and how to legally break your lease.

Breaking a Lease in Colorado to Buy a House

In Colorado, landlords can’t hold you to a broken lease while the apartment is vacant.

Write a letter to your landlord explaining why you’re leaving early. A new tenant must be found. If you broke your lease without cause, you may owe rent and damages.

If you depart before the end of your lease, Colorado law requires your landlord to re-rent the property. If you’ve lived in Colorado for more than a year, you must provide your landlord 60 days’ notice to end the lease.

Breaking a Lease to Buy a House in California

You need to provide as much notice as possible and drafting a letter to your landlord can help.

In California, breaking a lease early usually entails paying one or two months’ rent.

Under certain conditions, you can legally end your lease. If you do that, you’re not “breaking” the lease, but ending it legally, regardless of the lease. You need Civil Code 1942.

Breaking a Lease in Texas to Buy a House

If you can’t legally break your lease, you may not have to pay the remaining rent. Under Texas law (Tex. Prop. Code Ann. 91.006), your landlord must make reasonable efforts to re-let your unit rather than charge you for the remaining rent. The tenant or landlord can end a month-to-month lease under Section 91.001 of the Texas Property Code.

Breaking a Lease in Georgia to Buy a House

In Georgia, every tenant is required to sign a lease. It is critical that they adhere to the lease time specified in the contract.

You must be able to present a copy of a court order, such as a Temporary Protective Order, as well as a written termination notice.

Buying a House While Renting an Apartment

When buying a property, every step can feel important. First-time home buyers and those renting an apartment may feel this way.

There are six essential steps involved in buying a house while renting an apartment.

Having a Professional Inspect Your House
Taking Care of the Loan Processing
Assessing the Condition of the House
Getting a policy for your homeowner’s insurance.
Completing the Sale of the House
Acquiring the Necessary Keys.

Frequently Asked Questions

Is Breaking a Lease Worth It?

Breaking your lease can be worth it and a viable choice if you want to move quickly. Depending on your lease, you may be able to leave your existing place with a reduced penalty.

Breaking a contract can have devastating effects on your finances, credit, and reputation as a tenant, so do your study.

How easy is it to break a Lease?

Without your landlord’s authorization, breaking a lease can be difficult. If your landlord doesn’t support breaking the lease, you have few legal options unless you have an extreme circumstance.

You should be entitled to break your lease for military reasons, if your apartment becomes inhabitable, or if you’re a victim of domestic violence.

It’s important to know your state’s lease-breaking regulations so you know your options and potential consequences.

Why Would You Break a Lease?

There are reasonable reasons to break a lease, and some afford legal safeguards if your landlord sues you.

You may desire to move because your landlord doesn’t maintain the property, to escape a hostile scenario, or for a new job. We can’t anticipate the future, so you may wish to move before your lease ends.

Renters may break a lease to buy a home. Many apartments require tenants to sign a year lease to move in, and you need somewhere to live while you search for a home.

What Costs Do I Need to Pay When Breaking My Lease?

Many leases allow tenants to pay an “early termination fee.” If so, tenants must pay one to two months’ rent to leave.

The amount you’ll pay if you break a lease is usually specified in a clause of the lease. The “flat fee” is the name given to this sum.

What Are Some Ways You Can Break the Lease Without Costs?

Here are some pointers on how to break your lease without incurring any penalties.

1. Check for a break of contract.

As part of your lease, your landlord must keep the property safe.

Not every homeowner follows the rules. If they reject pleas to fix broken appliances, plumbing issues, mold, or pests, they’ve broken their lease. A dodgy landlord can be a blessing because you can break the lease without penalty.

This place is difficult. It’s not an easy way out if you’re renting a typical property with a nice landlord, but if you’re living in a den, it could work.

2. Find a replacement tenant.

You can find a substitute renter if you can’t sublease. You may have a place for friends to stay. From signing the lease to moving in, it takes at least 45 days, giving you 6 weeks to find a replacement tenant.

3. Talk to your landlord or property manager.

If you can mutually agree to end the tenancy, you can break your lease for free. Always ask the property management if they plan to move in, give it to a family member, or sell. The worst they can say is no.

Can You Break a Lease If You Buy a House in Michigan?

If you can’t legally break your lease, you may not have to pay the remaining rent. Under Michigan law (Fox v. Roethlisberger, 85 N.W.2d 73 (Mich. 1957)), your landlord must make reasonable steps to re-let your unit, no matter your reason for leaving, rather than charge you for the remaining rent.

Under Michigan law (MCL 554.601(a), tenants who have inhabited their rental property for more than 13 months may terminate the lease with a 60-day written notice if they qualify for subsidized senior housing or are unable to live independently due to age or disability. If the tenant can’t live independently, a doctor must notarize a statement.

Can I Break My Lease If I Buy a House in Arizona?

No, you won’t be able to. With one exception, you can’t because the normal Arizona Residential Lease Agreement comprises 333 lines of contract wording, none of which indicate any authorized cause to break your lease.

Can I break my lease if i buy a house in Tennessee?

The automatic termination of a renter’s lease upon becoming a homeowner is not permitted by Tennessee law. Let’s be honest: there aren’t many situations in which you can lawfully break your lease without your landlord’s consent.

Can I Break my Lease if I Buy a House in California?

In the state of California, you cannot break a lease without incurring penalties on the grounds that you have purchased a home, lost your job, or are experiencing medical issues.

Can I Get Out of My Lease Due to COVID in California?

The COVID-19 outbreak is not a legal basis in California for terminating a lease. So COVID-19 and related financial hardship, and mental distress are not grounds for a lease termination in California.

How Can I Legally Break My Lease in California?

If your renter is on a month-to-month lease and wishes to leave, California law requires them to give the landlord thirty days written notice before moving out. If you want to terminate the lease and make it month-to-month, you must also provide your tenant thirty days’ notice.

How can I break my lease without penalty in California?

Make sure this is the best option for you.
Re-read your lease or tenancy agreement.
Figure out if you can break your lease under California law.
Negotiate with your landlord.
Make it official with paperwork.
Move out and hope your landlord re-rents quickly.

Can You Break a Lease If You Buy a House in Virginia?

Unless you are buying the property you are renting from your landlord, purchasing a house is not a valid ground for terminating a lease in Virginia.

In the event of a disagreement, the clear provisions of your lease will be enforced by the court. For further information, contact a local attorney in Virginia.

Without a valid reason to break your lease, you may not have to pay the remaining rent. According to Virginia law (Va. Code Ann. 55.1-1251 (2020), your landlord must make reasonable attempts to re-let your unit, no matter your reason for leaving, rather than charge you for the remaining money due on the lease.

When to Give Notice to Landlord When Buying a House?

Risk tolerance determines everything. Home buyers give landlords notice before closing. Some wait for the P&S, others for the lender’s loan promise.

After signing the final paperwork and getting the keys, tell your landlord you’re buying a house.

Overall, timescales are unpredictable, therefore negotiate a long finish date.

Can I Break my Lease If I Buy a House in Illinois?

Only five reasons are allowed by Illinois law to end a lease without being responsible for unpaid rent or paying a penalty. If you wish to break a lease because you want to move in with a partner, acquired a house, or need to move for education or employment, you have no legal protection.

These justifications for breaking a lease include:

Domestic or sexual violence victim.
Your landlord violated your privacy or harassed you.
Your rental violates health and safety codes.
Early termination clause.
You’re enlisting in the military or air force.

How Can I Break my Lease Without Penalty in Illinois?

It’s not easy to break a lease in Illinois, but there are some circumstances in which a renter can do so without paying a penalty.

Leases can always be terminated if both parties agree.
If the apartment is uninhabitable, tenants have the option to break their lease.
Early termination costs may be included in leases.
Leases that are illegal cannot be enforced in court.
Landlords in Illinois have a responsibility to reduce damages.
A lease can be terminated by victims of domestic violence or other offenses.
When a unit is “abandoned,” Chicago has a precise definition.

How Can I Break my Lease in Illinois?

Unless the other party agrees, neither the renter nor the landlord can change their minds and get out of the lease before it expires. However, both parties can agree in writing to terminate the lease early. Even if the tenant moves out, if no agreement is made, the renter is responsible for paying rent for the entire lease term.

What is the penalty for breaking a lease in Texas?

Only the portion of rent that the landlord loses as a result of your early departure must be paid. This is due to the fact that Texas law requires landlords to take reasonable measures to minimize losses, which is known as “mitigating damages” in legalese.

How Can I get Out of my Lease Early in Chicago?

In Chicago, the tenant must give the landlord 30 or 60 days’ notice before implementing a buy-out clause to break a lease. The buy-out cost is usually 2-3 months’ rent.

If the problem isn’t fixed within 72 hours, the tenant may cancel the lease and evacuate the premises within 30 days.

Can I Break My Lease If I Buy a House in Florida?

There are no laws in the United States or Florida that permit renters to immediately terminate their lease upon purchasing a home. There are not many legal circumstances for which you can legitimately terminate your lease without your landlord’s approval.

Can I Break my Lease If I Buy a House in Georgia?

Breaking a lease in Georgia without a penalty is usually not justified for personal reasons. Renters may desire to break a lease for personal reasons such as: Purchased a home. If there is a clause in your lease that allows you to break your lease early if you buy a new house, you must give your landlord or property manager adequate notice.

Does Breaking a Lease Affect Your Credit?

Breaking a lease won’t damage your credit score if you pay all outstanding expenses before moving, including any back rent and fees. Breaking a lease, on the other hand, can harm your credit if it results in unpaid debt.

Can a Tenant Break a Lease?

If the apartment violates habitability rules, the landlord harasses the tenant, the tenant receives a change in army station orders, the tenant is a victim of domestic violence, or the flat is illegal, the tenant may be allowed to lawfully break the contract.

What Happens If I Break My Lease?

Early termination fees are stated in the lease. The condition may oblige you to pay one to two months’ rent or rent for as long as it takes to find another tenant, presenting you with a big charge.

How Can I Get Out of My Lease Early in Georgia?

In Georgia, whoever wishes to cancel the lease must provide the other party with at least 30 days’ written notice of their decision to do so. In many circumstances, tenants who intend to vacate early are required to pay an early termination fee equal to one month’s rent.

What is an Early Termination Clause?

Termination clauses, sometimes called severance provisions, allow early and consensual contract termination. Parties can prevent a disagreement by using a predetermined termination clause.

How much does it Cost to Break an Apartment Lease in Texas?

The Texas Apartment Association advises charging 85% of a month’s rent for early lease cancellation. A landlord may sue a delinquent tenant for back rent in exceptional cases. Most disputes are heard in small claims court with a $10,000 cap.

The Texas Property Code allows deployed or permanently stationed service members to quit a lease early.

In Texas, early lease termination often requires a reletting fee.

Texas tenants who want to break their lease early have few legal options. Your landlord must let you break your lease only in a few situations. Even if your landlord agrees to let you out, it may cost you.

Can I Break my Lease if I Buy a House in Texas?

Other reasons for breaking a lease include purchasing a home, relocating for a work, or even suffering through a breakup. However, none of these are covered by the law. You’ll need to double-check your lease instead.

Can I Break my Lease If I Buy a House in Ohio?

Checking your rental agreement to see the cancellation provisions is the first thing you should do. Ohio law doesn’t require landlords to re-rent units when tenants break leases. So you need to provide as much notice as possible and drafting a letter to your landlord can help.

Also, check your rental contract’s cancellation provisions. Your lease may have conditions for paying the remaining balance or early termination fees. Before meeting with your landlord or leasing agent, learn the agreements.

How Can You Legally Break a Lease?

In real estate listing and as indicated, breaking a lease can be justifiable. When lawful, tenants have no further lease obligations. They only need to serve you the proper notice and documentation, if needed.

What Happens If You Break a Lease Early?

You will be required to reimburse the cost of the remaining months of your lease agreement or pay an early termination charge, find a new renter, or all three. Your landlord may utilize a collection agency or small claims court if you are unable to pay to recover the rent.

How Can I Break my Lease Without Paying in Ohio?

In the following circumstances, you may be allowed to legally vacate your apartment before the lease term expires without paying in Ohio:

You’ve been assigned to active military duty.
The rental unit is unsafe or in violation of Ohio health and safety regulations.
Your Landlord Is Harassing You or Invading Your Privacy.

How Can I Break my Lease Without Penalty in Ohio?

Under Ohio, you can move out early without penalty in the following situations:

You’re deployed.
Unsafe rental.
Your landlord is rude.
Ohio landlord re-renting.

What does breaking the lease mean?

When a tenant or resident vacates the premises without giving notice, they are in violation of the rental agreement (or lease) before the lease’s expiration date. In other words, a lease break is when a tenant and a landlord decide to cancel a lease agreement before the expiration date.

Is there a way around breaking a lease?

Occasionally, a renter may be able to lawfully break the terms of the lease. Tenant has the right to lawfully terminate the rental agreement if the property is unlivable or illegal, the landlord harasses the renter, the tenant is on active service in the military, or the tenant is a victim of domestic violence.

Can you buy a house before your lease is up?

People frequently approach me with the intention of purchasing their first house before the time their lease expires.

Do not subject yourself to this. Purchasing a home while still renting another one is not punishable. However, there may be a fee for breaking the lease early.

I’d advise speaking with a lender and obtaining pre-approval approximately three months prior to the end of your lease, depending on how hot your market is.

Does breaking a lease hurt your credit?

Your landlord will typically impose penalties if you breach a lease. Your credit ratings may be impacted if you don’t pay these fines since your landlord may send the debt over to a collection company.

How to Write Early Termination Letter

You can use the below letter template and modify to suit your own lease option.

Sample Letter to Landlord: Intention to Vacate

[your name and address] [Date] [Your landlord’s name and official address, as listed in the lease] Re: Notice of Intent to Vacate Dear [Landlord], This letter will constitute written notice of my intention to vacate my apartment on [date], the end of my current lease. I am doing so because [explain the reason if you desire, such as a large rent increase]. Please recall that I made a security deposit of $______ on [date]. I expect to receive that deposit refunded in full, since the apartment is in good condition. Very truly yours, [Your name]

Sample Letter to Landlord: Request for Security Deposit

[Your name and new address] [Date] [Your landlord’s name and official address, as listed in the lease] Re: Request to Return Security Deposit Dear [Landlord], Pursuant to [applicable state statute], please forward my security deposit and accrued interest to my new address, [new address]. I hope it is your intention to return the whole of my security deposit and interest as required by law. If you feel that you are entitled to retain any portion of the deposit, you must provide me with an itemized statement of all charges. If you attempt to retain any portion of my deposit without adequate reason, this letter is written notice of my intention to pursue my claims to the entirety of the deposit. Very truly yours, [Your name]

Sample Letter Source (link)

Conclusion

Congratulations are in order if you’ve finally reached an agreement on the purchase of a new property; this is one of the most significant and fascinating long-term investments you can make. But what should you do if you find a new residence while you are still obligated to fulfill the terms of your current lease? The question of whether or not you are allowed to break a lease in order to move into a new property can be a murky and difficult one to answer.

If you find yourself in this difficult situation, we’d a rundown of the various alternatives available to you when terminating a lease in order to purchase a home.

Final Thoughts on Can I Break My Lease If I Buy a House

Breaking your lease can be a viable choice if you want to move quickly. Depending on your lease, you may be able to leave your existing place with a reduced penalty.