As a landlord, one of the trickiest dilemmas you might face is how to terminate a lease agreement due to selling your property. While the ideal situation would be to perfectly time the sale with the lease's expiration date, the likelihood of that scenario is slim. If you have sold your home and the closing date happens to be before your landlord/tenant agreement ends, the new owners may be willing to agree to let the tenants stay until their lease is up. However, if all possibilities fail, you may need to terminate the lease agreement.
Write a letter of notice of termination. Most states require a 30- to 60-day advanced notice for tenants to be notified that a lease is being terminated. The more notice you provide, the less likely you are to come across resistance from your tenants. Explain that the home is being sold; if you speak respectfully, with a sincere apology for the inconvenience, you increase your chances of a cooperative and timely vacancy.
Copy in your attorney on the termination letter, and have him look over it before you officially give it to the tenants. If you do not have an attorney, be sure to look up the specific laws in your state regarding early termination of a lease. Keep in mind that "early termination" is not necessarily the same as "eviction," because your tenants might not have otherwise been evicted if it were not for the sale. Be sure to send the letter by certified mail, so that an adult at the home has to sign for it upon receipt.
Call your tenants to be sure that they received your letter of termination. By following up, you can rest assured that they are aware of the situation, and it opens the door to discussing time frames and ending the agreement on a positive note. If your tenants are resistant to the concept of ending the lease early, you may want to, again, look into the possibility of the new owner allowing the tenants to stay until the lease is terminated, whereby the new owner would have the benefit of rental income for that period of time.
- house sold garden image by Nicemonkey from Fotolia.com