CapRelo Blog

6 Tips for Rental Lease Cancellation Assistance

Posted by Rick Bruce on Tue, Oct 16, 2012

Employee relocation often involves those who rent or lease their residence. Relocation policies should reflect this situation and offer assistance to those transferees in need. Monetary penalties for lease cancellation typically are manageable, particularly if the employer designs their policy carefully.

Longer-term leases, with extended time to run, can generate some larger monetary penalties, but cancellation fees can be negotiable. Employers can contain costs in this area by clearly describing assistance levels and capping maximum money outlays.

According to well-respected Worldwide ERC, the following rental and lease assistance features are common to competitive employee relocation programs. Since renters cost less--far less--than homeowners to relocate, competitive transferee programs are beneficial to both employer and employee.

Popular Rental Lease Assistance Features

Lease cancellation penalties--and assistance--should be capped. Lease contracts can carry a diverse range of penalties for early cancellation. Leaving your reimbursement or assistance language open-ended may challenge your cost containment and management goals. For this reason, many typical relocation programs cap assistance at up to two months' rent.

Assistance does not include reimbursement for damage deposits. As all renters are aware, landlords can have widely diverse "views" of cleaning necessities and/or damage repair costs. Employers providing assistance for this component are going above and beyond the norm. Once again, including this feature would be welcomed by employees, but could damage employer cost containment objectives.

Recognize common needs of renters at their current location and preferences (renting or buying) at the new location. Specifically including and noting your rental and lease cancellation assistance recognizes your concern for and value of your relocating employees who are not homeowners.

Popular Relocation Services for Renters

  • Complete needs analysis. While there are many requirements that apply to most renters, some employees will have specific needs. Addressing both the common and unique needs of individual transferees gives both employer and employee confidence in a smooth relocation process.
  • Lease cancellation advice, guidance and counseling. Much like selling a home in a down market, cancelling an active lease creates stress and uncertainty. Most employees have little or no experience in negotiating reasonable lease cancellation terms and penalties. Employers should offer useful advice and guidance regarding this important phase to help their transferees reduce stress and achieve a successful move.
  • Referral of experienced local assistance resources at the new location. Since the destination location is probably unfamiliar to the transferee, having a trusted local source of help finding a new appropriate residence, whether buying or renting, is valuable. Employers and employees both benefit from this feature, as the transferee gets settled in to a new home and becomes productive at the workplace quickly. Offering orientation of the new geographical area, showing preferred options during the residence hunting trip(s), and helping with lease or purchase negotiation, these sources achieve numerous goals, all of which save money, generate workplace performance and/or better bottom lines.


Outsourcing your needs to a professional, proven relocation firm, such as CapRelo, eliminates many employer administration requirements, employee trepidation and offers excellent cost management. Consider saving the extra workload and stress on your HR employees, while keeping your accounting and finance department smiling, by choosing this option.  

Download Our Free Article on Incorporating  Property Management

As Worldwide ERC so eloquently states, "Renters are people too!" Give them the respect, as valued employees, that they deserve. Include a reasonable rental lease cancellation and assistance feature in your relocation policy.

Topics: Lease Cancellation Issues, Popular Rental Lease Assistance Features, Rental Lease Cancellation Assistance

Rental Lease Cancellation and Assistance

Posted by George Herriage on Tue, Sep 18, 2012

Relocation assistance often focuses on helping new or transferred employees sell their homes. Often overlooked is the help needed for those key employees who are renting or leasing homes. When relocating at their employer's wishes, renters often need help in making graceful and financially reasonable exits from their current homes.

Legal Lease/Rental Termination Conditions

You'll not be surprised to learn that state laws can vary widely regarding permission for tenants to terminate lease/rental agreements. For example, if you enlist in the military, some states permit a legal, early termination of a lease, while other states do not.

In some jurisdictions, a tenant who must relocate to an elderly care facility may legally terminate a lease early. Some states even allow people to move without penalty if their current employer mandates a relocation.

Check your state laws to learn what, if any, legal provisions exist to help simplify your relocation if you have a valid lease. Most states define rentals as month-to-month implied contracts, meaning that only a 30-day notice of termination is necessary.

But, as always, take nothing for granted. Before asking your relocation company or employer for assistance, learn precisely what help you need. The terms of your lease and prevailing state law will dictate the level of assistance you need.

Lease Cancellation Issues

Leases can pose more complex problems for lessees, employers and relocation companies than typical shorter-term rental dwellers. Leases are usually for much longer terms, typically one-year periods or longer. Most states offer strong protection for landlords with tenants having valid leases.

Having your employer or relo professional negotiate a buyout or finding a sub-tenant, if permitted, is more important when you have a signed lease. Fairly negotiated leases benefit both lessees and landlords. Both parties enjoy protection. Unless specifically waived in the lease or if early termination is permitted by state law, penalties will apply as lessees are responsible for the payment of the entire lease contract.
   
Renting Versus Selling Your Home

Circumstances may present the option of renting, instead of selling your home. Top relocation professionals usually offer high quality property management services. This assistance typically includes collecting and recording rental payments, paying expenses, such as utilities and mortgages. and delivering monthly reporting to the homeowner, with all transaction details included.

Should you prefer the longer-term protection of offering a lease, relocation professionals can negotiate this agreement for you with a tenant. Depending on your needs and wishes, some relocation organizations offer total property management services, including advertising, screening potential tenants and helping you set appropriate market prices.

Rental Issues

Local housing laws influence the ease or difficulty for transferred employees needing to move prior to their rental term expiration. Because of the usually shorter landlord notification requirements, the focus often becomes a potential forfeiture of security deposits, normally equal to at least one month's rental fee.

At times, renters can escape financial loss by finding a sub-tenant. However, their rental agreement must permit renters to sub-let their home or apartment. Vacancy notification requirements remain less financially daunting if you're renting on a month-to-month term.

Download Our Free Article on Incorporating  Property Management
Individual states, sometimes even cities and counties, have separate regulations and protections for landlords and tenants. Whether you're interested in early lease cancellation or wishing to rent your home after you move, relocation professionals can negotiate a favorable buyout for you or effectively manage your rental property.

 

Topics: Rental Issues, Lease Cancellation Issues, Renting Versus Selling Your Home, Rental Lease Cancellation Assistance

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