Early Surrender of Fixed Term Contract

McTaggus

Hi All,

Thanks for all of the advice that you have kindly provided previously. The good news is that our house purchase is progressing more swiftly than we had originally anticipated. The bad news is that it means I have to tackle our rather obnoxious landlord about our departure sooner rather than later!

We are currently renting a property on a fixed term contract, which ends at the end of June. Having searched the forums and read a number of the very helpful posts and threads that are available, I wanted to just check that I am correct in the following conclusions:

1. A tenant under a fixed term contract can leave the property at any time, but will remain liable for the rent owed for the full term of the contract
2. The tenant does not have to provide notice of the intention not to renew the contract at the end of the term, though some would consider it polite to do so
3. In the event of leaving the property early, the only way to be alleviated of responsibility for the property (rent aside) would be to negotiate an early surrender of the fixed term contract
4. Both parties can negotiate the terms of the early surrender, and these should be captured in writing (and ideally signed)

Firstly, I would like to check that I have correctly understood the advice that has been given, and that this would be a true reflection of my position under a fixed term contract!

Secondly, I would appreciate any guidance about what early surrender agreements may look like, based on other people's experiences (either as tenants or landlords). We are more than happy to pay the rent due for the remainder of the contract term - it's a contract, we know we are bound to it - but would this normally be expected in a lump sum upon departure of the property, or phased over the remaining term of the prior contract? I assume lump sum would normally be expected, but before I start discussing with the landlord, I just want to check that would be a reasonable assumption! Are there any other aspects I should bear in mind?

Finally, are there any reasons why a landlord would potentially refuse early surrender, even if the tenant is happy to make good on the remaining value of rent due that I should be aware of? I know it's ultimately up to both parties to agree, but just keen to understand if there are any major barriers that might prevent early surrender more generally.

Thank you all again for your help, it is truly appreciated

(P.S. I'm in England by the way)

Guest101

McTaggus wrote: »

Hi All,

Thanks for all of the advice that you have kindly provided previously. The good news is that our house purchase is progressing more swiftly than we had originally anticipated. The bad news is that it means I have to tackle our rather obnoxious landlord about our departure sooner rather than later!

We are currently renting a property on a fixed term contract, which ends at the end of June. Having searched the forums and read a number of the very helpful posts and threads that are available, I wanted to just check that I am correct in the following conclusions:

1. A tenant under a fixed term contract can leave the property at any time, but will remain liable for the rent owed for the full term of the contract - Correct. Though there may be additional clauses about informing the LL about this, as it can affect insurance.
2. The tenant does not have to provide notice of the intention not to renew the contract at the end of the term, though some would consider it polite to do so - Again correct.
3. In the event of leaving the property early, the only way to be alleviated of responsibility for the property (rent aside) would be to negotiate an early surrender of the fixed term contract - Correct. (unless there is a break clause or the property is uninhabitable)
4. Both parties can negotiate the terms of the early surrender, and these should be captured in writing (and ideally signed) - Correct (and in some respects executed as a deed, which needs witnesses. Though in practice this is rarely a requirement.)

Firstly, I would like to check that I have correctly understood the advice that has been given, and that this would be a true reflection of my position under a fixed term contract! - So far so good!

Secondly, I would appreciate any guidance about what early surrender agreements may look like, based on other people's experiences (either as tenants or landlords). We are more than happy to pay the rent due for the remainder of the contract term - it's a contract, we know we are bound to it - but would this normally be expected in a lump sum upon departure of the property, or phased over the remaining term of the prior contract? I assume lump sum would normally be expected, but before I start discussing with the landlord, I just want to check that would be a reasonable assumption! - The terms of a surrender are usually fulfilled upon the surrender. But you can negotiate whatever you wish





Finally, are there any reasons why a landlord would potentially refuse early surrender, even if the tenant is happy to make good on the remaining value of rent due that I should be aware of? I know it's ultimately up to both parties to agree, but just keen to understand if there are any major barriers that might prevent early surrender more generally. The LL becomes liable for bills. Council tax would be the major contributor here.

Thank you all again for your help, it is truly appreciated

(P.S. I'm in England by the way)

Above in red

McTaggus

Guest101, my sincerest thanks for your swift and reassuring response. It is greatly appreciated! Indeed there is a clause that states that we must notify the LL if the property will remain empty longer than XX days, which I presume is linked to the insurance. There is no break clause in the contract, so therefore assume negotiating early surrender is the only way forward.

It's also reassuring to know that I have not been lobotomised in my sleep, and that my brain is still functioning at least a fraction of the time!

thesaint

If you are not released from the contract, then rent is due when it is due.
If a surrender is agreed, then it is whatever is agreed.

McTaggus

A great reminder - thank you!

franklee

If you can agree an early surrender then it all depends on what's negotiated. Hopefully the landlord will be willing to negotiate but he is not under any oblation to. It may be he wants to charge you re-letting fees and rent till a new tenant moves in which could be more expensive than just letting the tenancy run it's course if you only have a month or two left.

If you can't agree an early surrender then the tenancy continues till the end of the fixed term. You don't have to live there but you still have to behave in a tenant like manner. So you still pay council tax and utility bills. Still make sure the property is heated in freezing weather. Still visit to check all is fine and secure etc. Rent falls due in the usual pattern. You retain access to the property and the landlord has to give notice if he wants to enter as usual. The latter point can be a bargaining point, e.g. you will allow unfettered access after X date in return for whatever it is could help you out.

Personally I found an overlap with the two properties very useful. You can clean the new property, move yourself in a small van saving removal fees and then clean the old property without moving day stress.

What I would not do is pay rent till the end of the fixed term and hand the keys back early as then the landlord gets to use the property in time you have paid for.

Also I recommend you attend the checkout inspection and take loads of photos.

SternMusik

I once negotiated an early surrender (I was the tenant). The agreement was that I would pay for the tenant finding fee (charged by the letting agency) and pay the rent until the day prior to the new tenants moving in. This turned out to be less than a months worth of rent in total. Absolutely worth it in order to escape the damp, mould ridden hell hole of a house (which looked quite presentable during the 5 minutes I viewed it...).

I felt really bad for the new tenants though. Apparently they were a group of Chinese students (possibly less likely to throw a fuss over the state of the house than me).

McTaggus

Thanks all for your responses, they have been really helpful.

Would you put your proposal to the LL in the first instance when requesting the early surrender, or would you ask first and then negotiate? I was thinking to put the proposal in when I first request early surrender - i.e. we will pay lump sum rent and you get free and unfettered access to the property immediately (given we know LL wants to strip it and refurb the entire building) - or would you wait to see if its something LL is open to first?

Guest101

McTaggus wrote: »

Thanks all for your responses, they have been really helpful.

Would you put your proposal to the LL in the first instance when requesting the early surrender, or would you ask first and then negotiate? I was thinking to put the proposal in when I first request early surrender - i.e. we will pay lump sum rent and you get free and unfettered access to the property immediately (given we know LL wants to strip it and refurb the entire building) - or would you wait to see if its something LL is open to first?

See this kind of information is useful to have.


That's leverage.


Ask the LL what terms they want for early surrender, you offered too much in my book.

Nobbie1967

Probably best not to tell the LL that you are purchasing a house and are therefore likely to agree poor terms for an early surrender just to avoid paying council tax/bills. Maybe mention you're considering moving for some other reason that's not urgent. That way the LL will probably offer you a better deal if he wants the house empty for redecoration for a month while you pay just an extra months rent. Rather than all the way to June.

McTaggus

Thanks both - really, really helpful. In which case I won't offer anything upfront but seek the LL's proposed terms. If we can get a more beneficial deal, that would help a lot - believe me, 3 months rent here is not a small sum (makes me wince every time I think about it)! I have budgeted for it and the CT/bills (to be safe in my planning) but certainly I'd much rather not pay more than we have to. Will let you know how I get on, as soon as the contracts on the new place have exchanged!!!!