Early Termination for Landlords (4 Things to Keep in Mind)

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Many challenges can cause tenants to want to break their lease early. They may have an unexpected job change, face income challenges they weren’t prepared for, or find themselves in the middle of an unexpected crisis. Alternatively, the property might not have been to their liking. Perhaps they have personal reasons for wanting to leave the property. Whatever the case, your tenant wants early termination.

What does that mean for you?

Your lease is a legal document that binds the tenant to your property for a specific period of time, usually for a year. A tenant who breaks their lease may face legal and financial penalties. As a landlord, however, you want to take steps to protect yourself while offering reasonable options that will, overall, prove helpful to your tenants. 

1. Check Your State’s Laws

While a lease is a binding legal document, that doesn’t mean that you can hold your tenant to that lease regardless of the consequences. A lease exists to protect both tenant and landlord–and you may need to check your state’s laws to make sure that you fully understand your tenant’s legal rights when they want to break that lease. 

For example, most states have laws that allow a tenant to break the lease early if the tenant is:

  • A military service member who receives transfer orders before the lease is up
  • A victim of domestic violence
  • The property is uninhabitable in some way

Your state’s laws may also designate how much notice a tenant must give you if they want out of a lease early or require you to actively search for a new tenant if the former tenant continues paying rent while the unit sits vacant. Even if the tenant breaks the lease at an inconvenient time–a college student breaking their lease in the middle of a semester, for example–you may still need to go through the steps necessary to try to rent out the unit while the former tenant continues paying rent on the unit. 

2. Exercise Common Sense and Compassion Where Possible

Obviously, as a landlord, it can prove incredibly frustrating when a tenant wants early termination. Instead of having a property you were sure was rented out for an entire year, you now have a property that won’t be generating the income you had counted on. However, it’s important to exercise common sense and compassion.

Why does the tenant want to break the lease? Even if you do not have a legal obligation to allow the tenant to break the lease early, in some cases, it may make more sense to go ahead and start looking for a new renter. Consider:

Did the tenant break the lease due to job loss? If the tenant can no longer afford the price of rent for the property, that tenant will not be better able to afford it if you do not allow them to break the lease. Not only could it spell financial ruin for the individual in question, but you also might not be able to collect that rent anyway. This means it makes more sense to go ahead and allow early termination.

Does the tenant want to break the lease due to divorce or another change in family status? Again, you may have trouble collecting rent from a tenant who has already moved out of the property–especially one that does not have the funds to give you. 

Does your tenant need to break the lease due to a job transfer? Some states will allow tenants to break a lease early, given appropriate notice, due to a job transfer out of the area. In other cases, you may want to simply allow the tenant early termination to facilitate the introduction of a new renter to the property. 

3. Consider How You Want to Handle Renting out the Property Again

Some tenants will choose to sublease a unit that they can no longer live in themselves, especially if the initial lease has grounds for subleasing. Others will help look for someone to sublet the unit so that they can move out more quickly. While you can — and likely should — allow the tenant to help you find a new renter if possible, you may not want to lay that responsibility on your tenant’s shoulders alone. Consider:

What are your requirements for a renter? Consider the type of renter you want in your property, including the factors you took into consideration when selecting the initial renter.

What screening steps do you go through? Do you conduct a background check on potential tenants? Check credit history? Those steps can take time–and you may want to make your current tenant aware of that process before they plan to enter into a sublease arrangement. 

4. Negotiate a Buy-Out, If Possible

When Tenants Wants to Break Their Lease: A Guide to Early Termination for Landlords

The easiest way to prepare for early termination is to include a clause in your rental agreement from the beginning. Include how much notice the tenant must give in order to break the lease, what the early termination fee will cost, and any other factors included in the early termination: when the tenant must move out by, for example.

If you’re a landlord with a tenant who has recently informed you that they wish to move out, however, you can still negotiate a buy-out option that will allow you to recoup some of the funds you have the potential to lose due to early termination while still allowing the tenant more freedom. In general, an early buy-out of a lease agreement charges 1-2 months’ rent, which will give you time to market the property and find a new tenant without substantial financial losses on your part. 


Handling early lease termination can be incredibly frustrating. It’s important to keep in mind, however, that tenants must often leave for reasons outside their personal control. Having a plan ahead of time for how you will handle those early terminations, including adding them to your lease agreement, can make it easier to navigate those challenges when they arise. Contact us to learn more.

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Your portal includes a selection of extremely useful reports. Reports are available in the “Reports” section, and are distinct from the financial statements. Unlike financial statements which are static records, Reports are dynamic real-time records that will update with current data every time you view them. 

Scroll down to learn more about Reports:

Navigate to the "Reports" module in your portal:

Owner Portal Reports
  • Keep in mind, these reports are dynamic records. They will refresh to display current information every time you view them. 

Enhanced Rent Roll Report:

Enhanced Rent Roll Report
  • The Enhanced Rent Roll Report will show the rent amount, last payment date, move-in date, lease expiration date, and security deposit amount for each of your tenants. 
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Unit Comparison Report:

Unit Comparison Report
  • If you own multiple units (or buildings) with Nomadic, you’ll get access to the Unit Comparison Report. 
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Income Statement Month-Over-Month:

Income Statement by Month Report
  • The Income Statement Detail – Monthly Report serves as a month-over-month record of portfolio performance. You’ll see itemized income and expense categories and can track monthly. This report will update with fresh data every time you view it. 

Financial Statements

Financial statements will be published to your portal on a monthly basis. The statements are found in your Documents library, and provide a historical record of all financial performance. The statements serve as a snapshot of financial performance over a given period, and are static documents (unlike Reports, the statements do not update/change in real-time). 

Scroll down for more info about the Financial Statements in your Documents library:

The Documents area contains monthly financial statements:

Owner Portal Documents
  • The statements in the Documents are are static documents. They are posted to the portal once a month to serve as a historical record of financial performance. 

Download a statement to see month and YTD financials:

Owner Portal Property Statement

You'll also find a month-over-month operating statement:

Month over Month Statement

Portal Communication Tool

You can use your owner portal to communicate with our team. Any messages you send through the portal will go straight to your Account Manager. When we reply, you’ll get an email notification and you’ll also see the message in your portal next time you log in. 

Here’s an overview of using the communication platform:

Click "Communications" and navigate to "Conversations":

Commincation Dashboard Screenshot
  • The communications module will contain a record of all messages that you create through the portal. 

Click the "New Message" button and send your message:

Owner Portal New Message Screenshot

Responses will show up in the conversation ticket:

Portal Conversation Response Screenshot
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You can reply in-line using the comment box:

Owner Portal Comment

Each conversation will be logged in its entirety:

Portal Conversation Snapshot

Understanding the Ledger

Your portal includes a ledger with all transactions. The ledger is populated with data in real-time as transactions flow through our accounting software. Much of this information is also available in the Reports area, as well as the Statements in your Documents library, but the ledger is the most comprehensive resource for diving into the details. 

Please scroll through the sections below to get a better understanding of how to interpret the ledger. 

By default, transactions are sorted chronologically:

Owner Ledger Dates
  • The date reflected in the lefthand column is the actual transaction date, not the “bill date”. This is the date the transaction was actually processed. 

If you have multiple properties with Nomadic, you'll see the address for each transaction in the "Location" column:

Ledger Property Column
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  • If you only have one property with us, you’ll just see the ledger for that property. 

The Description column displays the transaction type:

Owner Ledger Description Column
  • BILL: this is an expense transaction, such as for repair costs or management fees.
  • CHARGE: this is a transaction  billed to the tenant, most typically a rent payment. 
  • NACHA EXPORT: this is a credit we processed to your distribution account. This type of transaction is how you get paid! 

The Amount column shows the dollar value of each transaction:

Owner Ledger Amount Column
  • Positive Amounts: if an amount is positive, it reflects a transaction that is payable to you. Typically, this will be a rent payment that we collected from your tenants. On occasion, a positive number could also signify a journal entry or credit adjustment. 
  • Negative Amounts:  if an amount is negative, this is a transaction that is either payable to Nomadic or is an amount that has already been paid to you. Typically this will be for repair costs or management/leasing fees. Owner draws (net distributions into your checking/savings account) also reflect as negative amounts, since they have already been paid to you. 

The Account Balance column shows a sum of positive/negative transactions at a given point in time:

Owner Ledger Account Balance Column
  • Account Balance should always equal zero after a net distribution has been processed. When the balance is zero, this means that all expenses have been paid and you’ve received the remainder as net operating income, leaving a balance of zero (meaning: no one is due any money, as all funds have been distributed appropriately). 

Navigating the Propertyware Owner Portal

Your portal includes some extremely useful features that help you understand your property’s financial performance at a new level, with real-time transparency into every transaction.

Scroll through the snapshots below for an overview of portal navigation! If you need more help or have specific questions about using the portal, you can reach out to your Account Manager any time for a screen share. 

You can filter all info by date range or property:

PW Portal Filters

View a snapshot of income and expenses on your dashboard:

PW Owner Dashboard View

See every transaction in real-time on your ledger:

Owner Portal Ledger View

Statements and forms will be posted to your documents library:

Owner Portal Document Library

View a suite of real-time financial reports:

Portal Reports View

See a running list of all bills, and drill down for more detail:

Owner Portal Bills View

Under Bill Details, you'll find dates/descriptions/amounts and more:

Portal Bill Details

You can also communicate with your Account Manager through the portal:

Owner Portal Communication Tools

How do net distributions work?

Net distributions keep your accounting clean and simple. Each month we’ll collect rent from the tenants, deduct any repair expenses for the previous month and any management/leasing fees for the current month, and credit the remaining net operating income to your account. 

Net Distribution

You’ll receive a statement via email each time a net distribution is processed, and can view all transaction details in your Propertyware owner portal.