3 Things to Know About Lease Buyout Clauses

A lease buyout is an agreement in which a tenant pays to break the lease for the remainder of its term. While many landlords allow tenants to buy out their lease, the conditions vary depending on how the lease is written. In order to be prepared, there are 3 things to know about lease buyout clauses include the Notification Periods, Penalties, and Types of Buyout Clauses.

Notification Periods

The period of time required to let a landlord know that a tenant intends to move is the notification period. While 30-days is common, landlords’ requirements vary and must be documented in the lease.


The amount of money that must be paid to break the lease is the Penalty. An example is a 2-months rent buyout, not including the Security Deposit. As with the notification period, the Penalty varies and must be documented in the lease.

Types of Buyout Clauses

Military Housing
  • Lease Buyout with Notice and Penalty– Lease is broken with proper notice given and penalty paid.
  • Lease Buy Out Under a Rent-Responsible Clause– Tenant is responsible to pay the rent until the unit is rented to a new lessee.
  • Lease Buy Out For Military PersonnelUnder federal law, active military members who are reassigned or deployed are able to buy-out their lease. They must provide written notice to the landlord which includes a copy of their orders. If notice is given after the rent due date (usually the first of the month), then the next month’s rent must be paid. This is similar to a 30-day notice.

What Tenants Should Do

  • Review the lease and understand any buyout clauses that are included.
  • Confirm the notification periods and penalties for breaking the lease.
  • Ask landlord about buyout clauses if they are not listed in the lease.

Other Lease Information

Short-Term Leases and More

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