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Reletting Fees for Terminating Your Lease Early

Reletting fees are a common concern for those ready to end their lease early.
Reletting fees are a common concern for those ready to end their lease early.

Every once in a while, life throws us curveballs. Whether it’s a death in the family, loss of employment, or military obligations, renters have a variety of reasons for ending their leases early. 

One way to reduce the financial impact of breaking a lease early is through reletting. This process allows the current renter to find a suitable tenant to assume their lease and continue making payments to the landlord under a new agreement.

However, reletting often comes with fees which can vary depending on the jurisdiction and specific terms of your rental agreement. Keep reading to find out more about reletting fees and to determine if reletting is a smart choice for you.

What is Reletting?

Learn more about reletting and why it may be a good option for your and your family when faced with unexpected circumstances.

As we mentioned, the most common scenario for reletting is when a tenant needs to move out before their lease expiration date. However, there are other circumstances where reletting is common.

When a tenant chooses to relet their property, the landlord is required to locate a new tenant to avoid vacancies and reduce the impact of lost rental income. Additionally, landlords relet their property in cases where a tenant is evicted due to the non-payment of rent or other lease violations.

In instances where a renter needs to move out on short notice, the tenant often assists in the process of locating a new tenant to avoid the financial penalties of breaking the lease early.

Reletting vs. Subletting

Learn what subletting is and why it's different from other forms of early lease termination.

Reletting is often confused with subletting, also known as subleasing. Both are ways to allow a new tenant to occupy a rental property with an active lease, but there are some key differences to keep in mind.

Since reletting transfers the lease obligations to a new renter, the original tenant typically is not held responsible for any damages to the property or missed payments from the new tenant. Reletting is often the best option for permanent relocations when the original tenant must move and doesn’t plan on returning.

On the other hand, subletting arrangements typically hold the original tenant responsible for any damages to the property and missed rent payments. This is usually a good option for temporary relocations or renters who plan on returning to the property after a leave of absence.

Reasons for Reletting

There are numerous reasons that renters choose (or are forced) to relet their properties, including:

  • Financial Reasons: Tenants may have financial difficulties that include job loss, medical expenses, or overall economic downturns that make it difficult to meet rent obligations.
  • Relocation: Accepting a job with a new company may force renters to relocate on short notice and look to relet their property.
  • Relationship Changes: Breakups or divorces can lead to the need for new living arrangements among couples.
  • Upgrading or Downsizing: Tenants may choose to relet their property to upgrade to larger living spaces or to potentially downsize based on changes in their family size or preferences.

How Reletting Fees are Calculated

Reletting fees aren't uniform among landlords, which is why you'll need to reference your lease documents.
Reletting fees aren’t uniform among landlords, which is why you’ll need to reference your lease documents.

Reletting fees are meant to cover the costs associated with finding and placing a new tenant in the property. The landlord must initiate the process of finding, qualifying, and vetting a new renter and should be compensated for the inconvenience caused by ending the lease early.

In simple terms, reletting fees are determined by your landlord and local laws. You’ll be able to confirm the fee for reletting by referring to your lease agreement or by contacting your landlord. 

However, a fixed reletting fee is common among landlords in the United States. The specific amount of this fee will be clearly outlined in the lease agreement tenants sign prior to moving into the property.

Although less common, other reletting fees could involve liquidated damages, actual costs, renting until a new tenant is found, or further loss mitigation efforts by the landlord.

Negotiating Reletting Fees

Find out why it's important to negotiate reletting fees in today's rental market.
Can reletting fees be negotiated?

Renters have the ability to negotiate reletting fees with their landlords before and after the lease agreement is signed. 

After navigating the application, background check, and credit report part of the process, new renters can ask the landlord or property manager about the specific details of reletting. They will likely outline their policy and the fees for reletting, which is where you can start the negotiation process.

Some property managers may not be able to negotiate reletting fees, but smaller landlords not affiliated with large property management firms may be able to reduce the amount.

Renters who are currently in a lease and looking to relet may have more trouble negotiating. It may be difficult to convince the landlord to reduce the reletting fees specified in the signed lease agreement, but it’s still worth a shot!

Try explaining to the landlord the reason you’re reletting the property. Valid reasons like job loss, military deployment, or medical emergencies may allow you to convince the landlord to reduce reletting fees to minimize the financial impact of your situation. 

Alternatives to Paying Reletting Fees

Are there alternatives to paying reletting fees? Find out if there is anything else you can do to minimize the financial impact of your situation.

Reletting fees can add insult to injury depending on the circumstances that are forcing renters to terminate their leases. Here are some alternatives to paying reletting fees:

  • Subleasing: If your lease agreement allows it, you can find a subtenant to take over your lease for the remaining duration. You won’t incur reletting fees, but you may still be responsible for the rent if the subtenant doesn’t pay.
  • Early Termination Clause: Review your lease agreement for any clauses related to early termination. The lease agreement may have provisions that outline the costs associated with breaking the lease early and, in some cases, it may be less expensive than the reletting fee.
  • Find a Tenant Yourself: Take the initiative to find a new tenant to take over your lease. You can use online platforms, social media, or word of mouth to advertise the property. Once you find a suitable replacement, present them to your landlord for approval.

Final Thoughts

Regardless of your circumstances, reletting can be a great way to transfer your lease to another tenant who can fulfill the obligations of the rental. While reletting fees are a concern for many renters, these fees are often relatively small and may amount to one month’s rent or less. 

Remember to communicate early and often with your landlord if you’re considering reletting. With advanced notice, they may decide to reduce or eliminate the reletting fee to ease your financial burden.

Related: Subletting vs. Reletting Explained

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