Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
The rental agent will charge rental commission about $2000 for finding new tenant after the old tenant broke the 12 months lease to move out early. My old tenant only stayed for 8 months, therefore, there's at most 4 months rents I can collect before the new tenants move in. In the lease agreement, "Tenant shall also be responsible for lost Rent, rental commissions, advertising expenses and painting costs necessary to ready Premises for re-rental". My question is whether I charge whole commission $2000 for finding new tenants or I can only charge them for maximum 4 months portion of the commission (i.e. about $666) for the remaining leasing period.
What would be the right number I should charge to the old tenant for agent's commission in finding a new tenant?
You would be charging whatever the person you hire charges you to get a new tenant. If getting a new tenant requires a $2000 commission then that’s what gets charged. Stop thinking in the 4 months left on the lease. It has no bearing on the charges to find a new tenant.
You need to understand that you are not signing a new lease. You are simply getting a new tenant to take over the existing lease. Basically you’re changing names on the lease from Tenant A to Tenant B. The current lease will continue for four months until it comes up for renewal. At that time you have some choices.
1. Continue with the lease as is and converts to month to month or another year (whatever your renewal terms currently are in this lease)
2. Amend the existing lease to add or take away rules guidelines length of renewal etc.
3. You can give proper notice and terminate that lease and start a new lease with new conditions etc.
4. Terminate the lease and get a new tenant.
Most people are going to want a year lease, simply to make sure you aren’t gonna raise the rent on them. Regardless of that you simply amend the lease from the remaining 4 months to 12 month renewal.
Quote:
Originally Posted by Flamingo13
That doesn't even sound like a legal lease.
There is nothing illegal about it. The wording of tenant is responsible for lost rent is worded wrong but the law clearly states what mitigation is and what the tenant and landlord are responsible in their duties
Thank you very much for your insight. It all makes sense to me now.
I posted my question here too late. In fact, I just had a one year lease signed with the new tenants and they moved in last weekend. I am doing the final early termination charges for the prior tenants now.
Under this circumstance, 2 month lost rents will be charged for sure, but how do I remedy the agent's commission part? Will you give me another valuable thought?
Thank you very much for your insight. It all makes sense to me now.
I posted my question here too late. In fact, I just had a one year lease signed with the new tenants and they moved in last weekend. I am doing the final early termination charges for the prior tenants now.
Under this circumstance, 2 month lost rents will be charged for sure, but how do I remedy the agent's commission part? Will you give me another valuable thought?
Many thanks.
First of all you need to stop calling it lost rent. It’s unpaid or owed rent. The tenant owes you x months worth of rent due to their lease break and your mitigating the losses.
Ok
Let’s say your tenant has left and it has taken you two months to re rent the place.
The tenant owes you
two months rent amount
Whatever chargeable damages he caused you had to fix.
Any costs associated to rerenting the unit
Add up all the costs. If the costs are less than the deposit you send a itemized letter along with copies of the receipts of the repairs and amounts and the refund stating what you are charging the tenant for and showing their refund amount. If the amount owed is higher than the deposit you still send the letter but instead of a refund you send a demand letter for amount owed. If they don’t send the money you file in small claims take all your stuff with you and go to court.
If he has a refund but disagrees with the itemized charges he can take you to court to settle disputes also.
I doubt you’ll hear from him again. However if he moved out of state he has to come to the state the lease was signed. If he doesn’t show up you win a judgement
I have put down 2 month unpaid rent, cleaning fee and utility bills in my list. However, I still don't know how to figure out the agent's commission to be charged after I made mistake to have signed another one year lease a few days ago.
Can you enlighten me of how to do it? My agent said I can only charge 2 months worth of commission to the prior tenants, which I feel is not justified for all the trouble I have gone through.
I have put down 2 month unpaid rent, cleaning fee and utility bills in my list. However, I still don't know how to figure out the agent's commission to be charged after I made mistake to have signed another one year lease a few days ago.
Can you enlighten me of how to do it? My agent said I can only charge 2 months worth of commission to the prior tenants, which I feel is not justified for all the trouble I have gone through.
Thanks.
Whether or not a tenant leaves early, you'll still have to pay the commission for finding the next tenant, right? You just had to do it sooner.
Regardless of 'all the trouble' you've been through, you don't get to charge that 'feeling' off to a fee for something completely different.
I have put down 2 month unpaid rent, cleaning fee and utility bills in my list. However, I still don't know how to figure out the agent's commission to be charged after I made mistake to have signed another one year lease a few days ago.
Can you enlighten me of how to do it? My agent said I can only charge 2 months worth of commission to the prior tenants, which I feel is not justified for all the trouble I have gone through.
Thanks.
Doesn’t matter what trouble you’re going through. It’s part of being a LL. Sometimes you have paved roads sometimes you don’t.
Your agent should have a fee for procuring this new tenant....how much is that fee? How the hell can you charge two months worth of commission? That makes no sense. Is he charging you a commission based on how many months the tenant agrees to? So if he only had a tenant with a 6 month lease....he charges 1/2 of the yearly commission?
Normally a agent charges one months rent amount to find a tenant. If they manage the property then they get a percentage of the rent amount. Is that what he means by two months “worth of commission”? That’s not a commission that’s a management charge.
Did he charge you anything to find the new tenant? How much was THAT charge?
What you guys said I was going through this whole thread and I had to check my lease for a tenant that left early. Lo and behold, that provision is in my lease. My state is Pennsylvania.
What you guys said I was going through this whole thread and I had to check my lease for a tenant that left early. Lo and behold, that provision is in my lease. My state is Pennsylvania.
What I meant is that I paid full $2000 to get a new tenant. While I can only charge the old tenants for their early termination is merely the proportion for that 2 months vacancy, which means I can only charge the old tenants for 2000/12*2 = 333 agent's commission. In the past 10 months, I am paying $2000 + (2000-333) = 3667 agent's commission at the end.
What I meant is that I paid full $2000 to get a new tenant. While I can only charge the old tenants for their early termination is merely the proportion for that 2 months vacancy, which means I can only charge the old tenants for 2000/12*2 = 333 agent's commission. In the past 10 months, I am paying $2000 + (2000-333) = 3667 agent's commission at the end.
Nice! Hope it works out for you.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
I was going through this whole thread and I had to check my lease for a tenant that left early. Lo and behold, that provision is in my lease.
My state is Pennsylvania.
