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What to Do When You Aren't Renewing a Lease

You are under no obligation to renew a lease, unless there is a provision in the lease that provides an option for the tenant to renew (never put that in a lease), or something similar.

They never were much as tenants. The rent was always late. You had to serve them with seven notices during the year to correct one rule violation or another. The neighbors, your good tenants complained often (it seemed like at least once a month). So now the lease will be up and you are not going to renew it. What procedure do you use?

For every tenant who leases from you, rather than rents month-to-month, always make a notation on your calendar or planner 60 days before the expiration of the lease to deal with renewal. Some tenants you will want to renew, others you will send on their way.

Studies have shown that people start thinking about moving 45 days before they actually get around to doing anything about it. Your bad tenants may see the handwriting on the wall and be planning to teach you a lesson and move out when the lease is up. Just don't count on it. Sixty days before the end of the lease a notice from you to them allows you to get into their consciousness that you are not renewing their lease and they need to find another place to live.

You look at your planner one day and see that Jim and Judy Troublemaker's lease expires in two months. Immediately you fill in the form that tells them they will be moving. Then you drop it in the mail to them. Every state has slightly different requirements for notifying tenants, so be sure you follow the ones for your state.

Date ____________

Tenant name(s) ___________________________

Property Address ________________________Apt. __________

City _________________________

Your lease with us expires on ____________________ . We will not be renewing it. We expect you to vacate the premises by midnight on _________________ (expiration date).

If you wait longer, or if you don't even notify them at all, but wait until the lease expires, they will probably send the rent (on time possibly for the first time in months), hoping to avoid having to move. If you accept the rent, you are stuck with them for another month. If you don't accept the rent, you are probably still stuck with them. Hence, the best thing to do is start early telling them to move.

You are under no obligation to renew a lease, unless there is a provision in the lease that provides an option for the tenant to renew (never put that in a lease), or something similar. Many leases have a clause that states that the lease reverts to a month-to-month tenancy after expiration, absent any action otherwise. Accepting rent after the lease expires confirms a month-to-month tenancy. Sending them a notice telling them you are not renewing tells them there will be no such reversion.

The tenant's right to occupy the premises expires with the lease, unless you do something that would cause the tenants to infer otherwise, such as accept rent from them or actually tell them they can stay.

If the tenant doesn't move out by the expiration date, you will have to go through the legal eviction procedure. There is almost never a defense for not moving when a tenant is given a no-cause notice to move or a lease is not renewed. Check your local and/or state requirements for that. With 60 days notice that you are not renewing, though, they have had sufficient notice and have no grounds for claiming that this was the first they'd heard about having to move.

The key to not renewing a lease and getting rid of the tenant: tell them early.

Robert Cain, publisher of the Rental Property Reporter, has been providing solutions for the rental property industry for seventeen years. He is author of the landlord manuals Profitable Tenant Selection, Can Section 8 Work for You?, Using the Gross Monthly Rent Multiplier, the tape series “Avoiding the Tenant from Hell,” and several other booklets and manuals for landlords and property managers. In addition, he writes and produces newsletters for other companies that serve the rental property industry. He is a highly sought-after speaker, seminar leader and consultant on property management and real estate topics.

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