Life happens. Maybe you're seeking a new chapter in another city, or you’ve had a change in your living situation and need to move sooner than expected, leaving you with one big question: How much does it cost to break a lease? An early lease termination fee is rarely cheap, but understanding typical costs and your options can help minimize the financial hit.
In this article, we'll explore the various factors that affect how much you’ll pay, how to negotiate a lower fee, and some strategies for breaking a lease without breaking the bank.
What is a lease termination fee?
Before we get into the numbers, let’s clarify what an early lease termination fee is: A charge a landlord can require if you break your lease agreement early. It’s meant to cover the vacancy losses that may occur while searching for a new tenant, or any other financial disruption caused by your early departure. How much you’ll pay depends on a few factors, including your rental agreement, local laws, and time left on your lease.
How much does it cost to break a lease?
There’s no one universal answer to the burning question, “how much is it to break a lease?” The cost can vary widely depending on your specific situation. “It depends how far in advance you were able to notify the landlord, whether it's a family operation or corporate management company, and the average turnaround time to rent a property in your area,” says real estate investor Erwin Miciano.
Your specific breaking-a-lease fee can be found in your lease agreement. Most lease agreements will have a detailed early termination clause (and if they don’t, they should). This clause should include the termination conditions, notice period, what the penalties and fees are for early termination, and any other revelation information.
On average, you can expect to pay anywhere between one to three months’ rent as an early termination fee. For example, if your rent is $1,200 monthly and your lease specifies a two-month penalty for early termination, you’re looking at a $2,400 charge to break your lease. This lease termination fee alone is a tough pill to swallow, and there may also be other hidden costs to consider.
So, how much does it normally cost to break a lease? Let’s break down the average costs:
- Early lease termination fee: This will likely be your biggest expense, typically 1-3 months’ rent, depending on your lease terms.
- Security deposit deductions: Some landlords may keep part or all of your security deposit to cover unpaid rent or repair damages. Be sure to get the apartment professionally cleaned and fix any issues before moving out. If your apartment is in pristine condition, you might get your full deposit back. Otherwise, expect deductions.
- Unpaid utilities: You’re typically responsible for any utilities up to the date you vacate, which can include final water, electricity, and gas bills.
- Property damage fees: If you’ve caused any significant damage to the apartment, expect to pay for repairs beyond normal wear and tear.
What's the difference between a security deposit and an early lease termination fee?
It’s common for tenants to assume that the security deposit will cover the lease break, but that’s not usually the case. The security deposit is meant to cover damages or unpaid rent, while the lease termination fee is for the landlord’s inconvenience and lost rent during vacancy.
When the reason for the early termination matters—and when it doesn't
There are a handful of scenarios on the national level in which it is legally OK for tenants to break their lease without being expected to pay a fee, and there may be local or state exceptions as well.
Some of the primary reasons that would allow a tenant to break their lease without penalty include if they are an active duty military member who gets relocated, if the living conditions are unsafe or uninhabitable, if they are the victim of harassment by their landlord, or if they are a victim of domestic violence.
Besides those legal protections, your reason doesn't impact the lease termination fee. Unfortunately, most landlords only see numbers. “If you're lucky, there could be property managers who are empathetic and work with you for any serious reasons,” Miciano says. “The run-of-the-mill landlord will be concerned mainly about securing another tenant, repairs to get the property to a rentable condition, and the days of vacancy until it is filled.”
3 tips to reduce the cost of breaking a lease
Now that you know the potential financial damage you may encounter, let’s talk about how to bring those costs down. Here are a few strategies to minimize the financial hit:
1. Negotiate with your landlord
Many landlords are willing to work with tenants to avoid costly legal battles or a long-term vacancy. Try negotiating to reduce the fee or offer to help find a new tenant to take over the lease. “The landlord might be more motivated if your rent is substantially lower than the current market and it proves to be an opportunity to update their unit or home,” Miciano says.
“In real estate, everything is negotiable,” he says. “For the best outcome, build a relationship that is professional and communicative from the start, be clear, and be a problem solver.”
2. Sublet your apartment
See if subletting is a lease violation in your agreement or if it just requires permission from the landlord. As long as your replacement tenant can be approved by your landlord, it could be a viable option that solves two problems at once.
3. Ask for a lease buyout
In some cases, you can negotiate a lease buyout, where you pay a lump sum to terminate the lease. This is often a win-win, especially if you have only a few months left on your contract. “A lease buyout option is a fee paid either from the tenant or the landlord to end the lease as a full term,” Miciano says. “Proper notice is usually required by local policy, but can be a suggestion to be negotiated if not already in your leasing agreement.”
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Bottom line
Breaking a lease can feel financially overwhelming, but understanding the costs and exploring your options can help you navigate the process more smoothly. Whether you’re relocating for a new opportunity or just need a change of scenery, knowing your rights and negotiating effectively can save you money and stress in the long run.
FAQs
How much does breaking a lease cost on average?
The average cost to break a lease is typically one to two months' rent, depending on your lease agreement and local laws. On top of that, you might face security deposit deductions or fees for property damage.
What is the early lease termination fee?
The early lease termination fee is a penalty charged when you break your lease before its end date. It’s often equal to one to three months’ rent.
How can I reduce the cost of breaking a lease?
Negotiating with your landlord, subletting the apartment, and finding legal reasons to terminate the lease can help reduce the cost of breaking a lease.
What happens if I don’t pay the lease termination fee?
Failing to pay the lease termination fee can result in a lawsuit from your landlord or damage to your credit score. It’s important to address the issue responsibly to avoid long-term financial consequences.
How much does it cost to break an apartment lease?
The cost of breaking a lease can vary between apartments and houses. Apartments might be cheaper to break due to lower rent and potential landlord flexibility due to higher demand. It's essential to consult your lease and discuss your situation with your landlord to get an accurate estimate of the costs involved.
How much does it cost to break a lease by state?
Local laws matter when it comes to breaking a lease. In some states, landlords are required to make a reasonable effort to re-rent your unit if you leave early, which could lower your financial burden. In other states, you could be on the hook for the full remaining rent unless you negotiate otherwise. Make sure to check local tenant laws or consult a legal expert to get a clearer picture of what you’ll owe.