It is always a good thing when you sign a lease in New York City because it means you have finally found a place to stay and you cannot be ejected out. Signing a lease means you are bound by law to pay rent for the entire length of the lease which maybe 12 months or even longer and this can be a huge financial commitment. However, if for any reason you need to leave your apartment before your lease expires, you will have to take a financial hit.
Your lease is a contract to pay rent whether it’s for 12 or 24 months period and once it is signed you are obligated to pay up. During the pandemic, one of the lessons learned by many tenants was that it was not easy to get out of their lease as they had thought.
If you are planning to break a lease, landlord has what is called a duty to mitigate damages. What this means is that they have to do all they can to find someone else at the same rent, and they can choose to increase the rent if the market is in a competitive period and by doing so it lets you the original tenant go but even though landlords are required to mitigate damages by re-renting the apartment, you still may not be free to go so you either have to find some reason good enough for the landlord to let you go or find something the landlord has done to breach the agreement.
This law is designed to have landlords and tenants on the same page and to also encourage both the landlord and the original tenant to find a new tenant who meets the apartment’s income requirements and can take over the lease and then rent the apartment. Here is what to know and how to break your lease in NYC
Asked to be released (in writing)
Notify your landlord or management company in writing as soon as you know what you want out of your lease. Although you should find out from your lease the best way to communicate with your landlord but sending a letter through a register mail is the most formal method. In the letter, explain your situation and be honest and find out what your options are.
In situations like this, some landlords will be reasonable and ask you to find a replacement, some may even ask you to give them regular access to the apartment so they can show and market it to prospective tenants.
Ending a lease early is common, it happens all the time. Most larger-scale landlords have some kind of rule and process because there is no standardized policy on lease break but smaller and independent landlords may respond more depending on the scenario.
The best way to go about breaking your lease is to be upfront with your landlord and ask for any suggestions they might have that would release you from the lease. Some may not let you go until they find someone to re-rent the apartment or they might ask you to find a qualified tenant who can meet the apartment’s income requirement or they may let you go with a penalty because you are contractually obligated to pay.
What you need to do is to look for any situation that ends with you walking away early and that is getting your landlord to sign a “surrender agreement” containing a language that legally lets you out of the lease.
Find another Tenant
Finding someone to take your place is a good move but it might not solve the problem because the landlord will have to evaluate the person to ascertain if the person meets the annual salary of 40 to 45 times the monthly rent, a good credit history and proof of employment. The prospective tenant will need to meet the financial criteria of the landlord and pass whatever other screening process. For instance, if the person that wants to move in wants to use the apartment as a psychiatrist’s office that is a valid reason for refusal.
Landlords are allowed to reasonably withhold consent depending on the particular facts and circumstances of the nature of the occupancy or the legality of the proposed use of the apartment and it would not matter if the tenant meets the financial responsibility.
A NYC tenant’s rights organization, The Met Council on Housing has a guide on what constitutes a reasonable or unreasonable refusal. They also state that you have the right to suggest someone else qualified to take your place if you plan to leave your apartment permanently.
To release you from your responsibility, the landlord will need to assign the lease to the new tenant; this is called “an assignment”. Within 30 days, the landlord must assign the lease and if the assignment is denied, the landlord must provide a reasonable explanation for refusing the proposed tenant.
If you live in a building with at least four apartments, you have right to sublet it. If the landlord does not respond to your request within 30 days or within 30 days after receiving any additional information the landlords needs to know about the potential sub-letter, then by default, they have given you the go ahead to sublet the apartment. The difference between this case scenario and that of new tenant taking up your apartment is that you are still responsible of all the obligation of the lease which includes paying the rent. And if the landlord reasonably refuses to consent for whatever reason, you cannot proceed with subletting but if the landlord unreasonably refuses to consent to the sublet, you can go ahead with subletting but be ready because the landlord might challenge it in court.
Landlords have become stingy in the last 12 months with concessions but if you were given one or two months free, the incoming tenant may not get the same offer. And if the free months are at the end of your lease term, you will have to let them go when trying to re-rent the apartment.
If you are renting a condo or cooperative, the right to assign your lease does not apply but in cases like this, you are most likely dealing with individual owners who do not want to get lawyers involved and they are very reasonable. Nonetheless Boards have their rules that may not allow owners to re-rent to a new tenant for a lease that is shorter than 12 months or that the owner can only have one tenant per 12 months period. Although there is a way around situations like this but it is better you know in advance.
Avoid breaking your lease in winter
From November to March is the slowest seasonal time for rental in NYC. If you want to break your lease it is more difficult to do it during this season. To get a replacement tenant is easier in the summer. Rents are usually 10 to 30 percent lower in the winter and the landlord may need to offer more concessions so renter can take the place.
In an area when rent prices are increasing, it is the best time to break your lease because landlords are motivated to get new tenants at higher prices but more often than not, it depends on how many similar units the landlords is trying to rent. For example, if a landlord has a building of one-bedroom units available for the month and you are leaving another one of his apartment, that doesn’t help the landlord.
Nonetheless, if your lease ends in the winter, the slowest seasonal rental period of the year and you are looking to break it in the summer, the landlord might appreciate it if you can find someone that will rent the apartment for 12 months in the summer when the prices are much higher.
Most people start looking for a new apartment to rent 60 days in advance while those on full-service luxury apartment start 90 days in advance so you have to take note.
Your security deposit is (technically) safe
If you want to break your lease, the landlord is required by the law to do all they can to help you find another tenant. The purpose of this is to motivate both the landlord and tenant equally, this means your security deposit is not necessarily at risk. If the landlords could keep the security deposit anytime a tenant broke their lease then they would not be motivated to mitigate damages by trying to re-rent the apartment. Although the law makes it unlikely for the tenant to be sued for breaking their lease but they can still pay for damages which may include paying a brokerage to re-rent the apartment, repainting and payment for lost rent. Also your security deposit is still vulnerable if there are damages to the apartment and unpaid utility bills.
At the end of tenancy, the landlord needs to itemize any damage and give you an opportunity to fix them and pay you your money.
Be ready for other financial consequences
Although your security deposit is likely to be refunded to you but you may still face some kind of penalty for breaking your lease even though your apartment is undamaged, clean and with working keys. The fact is that a lease is a contract and contracts damages would apply. However one of the ways to avoid this is if you negotiate it before you rent the apartment. Although a lease-break policy might not be included in your lease but it might lay out specific monetary penalties if the lease is broken especially in the winter months.
A small NYC landlord says he offers a specific fee to tenants that want to end their lease, and this is not peculiar to just him. Most landlords do the same thing and tenants are expected to pay some kind of fee if the terms of the contact are not met. Whether your lease has a lease-break policy or not, you might have to pay the cleaning and painting costs.
It is also important to find out what your landlord is marketing your apartment for; if you are paying $2,000 and your landlord is marketing it at $2,500 then he has violated the law which states they have a duty to mitigate damages. To do this, you can ask a friend to help you find out from the broker. If the apartment is being marketed above the current rent, then the tenant is off the hook. However if the new rent is lower, then you may be on the hook for the different between your rent and the new one.
What’s the deal with the tenant blacklist?
According to rent law, landlords cannot deny someone an apartment solely because of the tenant blacklist. This means that you should not be intimidated to fight back when a landlord is making demand for fees.
How to make a case for a constructive eviction
All we have said is dependent on a situation where you are moving out voluntarily rather than a situation where you are forced to leave because the apartment has become a living hell. If you are breaking your lease early because there is a serious problem with the apartment like bed bugs, mold, lead pain or construction noise, then you may have a case for construction eviction and claim the landlord has defaulted to uphold the warranty habitability. And if the landlord refuses to correct these issues, it can constitute harassment. In cases like this, there is a specific provision in the law that enables the tenant to claim legal fees.
To claim constructive eviction, the tenant must first of all move out but if you are wrong you have to pay the rent so before you move you have make sure you are right. The best thing to do is call 311 and have the Department of Buildings and the Housing Preservation and Development come in to examine the apartment, if they issue violation, then you have proof of conditions. You can also find out yourself on the Department of Building website if the building has any violations, if there are issues with the facade of the building, if the apartment has been illegally deregulated, if the certificate of occupancy matches the use of the building, or if there are problems with the efficiency of the boiler.
You can take picture, send letter to the landlord, and call in experts to confirm the existence of issues like molds, bed bugs, asbestos or secondhand smoke in the apartment. These alone may be enough to pressure the landlord to let you out of the lease.