Preparing for Tenant Move-Out
The process of a tenant move-out should be a routine business task that smoothly transitions the rental unit back to the landlord. With so many details involved in the transition, what can a landlord do to make the move-out process as trouble-free as possible? The key is to have comprehensive rental policies that are communicated to prospective tenants early in the rental process and applied to all tenants throughout the tenancy.
Having a written rental policy and detailed procedures for tenant move-out including timelines for notices, inspections, unit possession, and accounting and return of security deposits allows the landlord to exercise greater control over the process. The plan provides a consistent process that ensures all required steps are taken in proper order and are legally compliant. This creates a faster, more efficient process for the tenant to fulfill his rental obligations.
For many tenants, the priority in the move-out process is the return of their security deposit. For landlords, the priority is an orderly tenant move-out with no surprises. Clear communication between the landlord and tenant helps to accomplish those priorities.
At lease signing and tenant orientation, the landlord sets out his rental policies and procedures, rental rules and regulations, tenant responsibilities and obligations, and expectations during the tenancy and at lease expiration. The tenant acknowledges his consent to the landlord policies and procedures by his signature on the lease document. The lease becomes the governing contract between landlord and tenant.
Landlord Notice of Lease Termination Date
To minimize potential problems at the lease expiration date, a landlord should give the tenant appropriate written notice that the tenant’s lease will be expiring soon. This reminder notice, generally at 60 days before the lease expiration date, accomplishes several things. First, the notice of lease expiration gives the tenant sufficient time to look for another rental unit. Second, the notice allows time for the landlord to negotiate a renewal lease with any changes in lease terms, conditions and rents. Third, the notice provides time for the landlord to begin planning and preparation for unit turnover and marketing to fill the vacancy.
Tenant Notice of Intent to Vacate
A landlord should include in the lease agreement terms and conditions that the tenant is required to provide written notice of the intent to vacate the premises on a specified date. A landlord will need to conduct due diligence to determine the legal notice period required by applicable laws for tenant notice of intent to move. In many states, a tenant is required to give the landlord at least 30 days’ notice of the tenant’s intent to move. Absent specific language in state statutes, the lease agreement terms and conditions regarding the issue will apply.
Move-Out Letter
Once a landlord receives the tenant’s written notice of intent to move, the landlord should sent the tenant an acknowledgement and confirmation letter.
The landlord‘s move-out letter should detail what the tenant must do when his lease expires in order to meet the terms of the lease. These move-in procedures must have been stated in the lease agreement and should have been discussed with the tenant when the landlord conducted new tenant orientation.
A good move-out letter explains the process of closing out the tenancy and what is expected of the tenant. The letter should include the following issues, all of which should be in the lease agreement:
- A reminder that the lease agreement gave the landlord and the landlord’s agents the right to show the unit to prospective tenants or to schedule contractor work upon reasonable notice per statute.
- A statement of the landlord’s expectations that the unit will be cleaned and left in the same condition as the tenant found upon moving in.
- An itemized list with instructions on how to meet the landlord’s cleaning standards and what items on the move-in checklist are the items of priority.
- A summary discussion of the move-out inspection procedures. This should include a reminder that all personal possessions must be removed from the premises prior to inspection.
- An instruction that the tenant must call the landlord at a specified time period before the lease termination date or move-out inspection date (whichever is earlier) to schedule an appointment for the final walk-through inspection.
- A statement that the inspection must be performed on or before the termination date and that the tenant must return possession of the premises including return of keys, garage door openers, gate keys, and pool pass, as appropriate to the rental unit. A reminder that the security deposit cannot be utilized for last month’s rent, including penalties for doing so.
- An explanation of how the security deposit accounting will be handled including reference to applicable state law for accounting statement, allowable deductions, and return of the deposit.
- A discussion regarding other deposits that were collected, their use and accounting.
- A reminder that the lease agreement prohibits using the security deposit as the last month’s rent.
- A request that the tenant provide a forwarding address and contact information for future communications and mailing of the check for the portion of the security deposit being returned and an accounting of any amount not being returned.
The letter should also remind the tenant that utilities must be left on until the final inspection has been conducted. All utilities in the tenant’s name should be scheduled for turn-off by the date of lease termination. The landlord should instruct the tenant of any climate and seasonal conditions that warrant special requirements for utility shut-off, such as cold weather water shut-off and draining of pipes and fixtures.
A detailed move-out letter can set the stage for a satisfactory final inspection. With adequate instruction and information, the tenant should clearly understand his duties and the landlord’s expectations during his move-out. Performance of those duties according to landlord standards should minimize the chance that a deduction for cleaning costs would be taken from the tenant’s security deposit.
It is advisable to attach a copy of the signed move-in property inspection checklist to the move-out letter. The landlord should also remind the tenant to refer to their lease agreement if there are any questions regarding move-out duties and responsibilities. A copy of the lease agreement with move-out policy, terms and conditions highlighted could also be attached to the move-out letter.
Move-in/Move-out Property Inspection Checklist
A move-in/move-out checklist and inspection conducted by the landlord and tenant can help the moving process go more smoothly whether the tenant is moving in or the tenant is moving out. The documented move-in property inspection report is the basis for the move-out inspection and determination whether the rental unit was well maintained during tenancy per tenant obligations under the lease. The move-out inspection cannot be more restrictive in determining property condition than was used during the move-in inspection.
Some states have specific rules and requirement for move-out inspections and use of checklists including whether the tenant must be present during the property inspection. In a few states the tenant must be provided a pre-move-out inspection. During a pre-move-out inspection, the landlord will note property defects that the tenant needs to correct before the final inspection if the tenant wants to maximize his deposit refund.
Landlords should require that the final inspection take place after the tenant has removed all personal possessions and the premises have been cleaned to the level of cleanliness that the tenant intends. This will increase the likelihood of positive identification of any damage to the unit including that which might otherwise be hidden behind furniture and damage caused by carelessness during the removal of furniture.
Best Practices
Best rental practices include clear communication between landlord and tenant of the tenant’s duties and responsibilities throughout the tenancy. A well-documented move-out policy and detailed procedures universal to all tenants provides a consistent, non-discriminatory process that minimizes misunderstanding and confusion regarding tenant obligations at lease expiration date. Waiting until the last minute to address move-out issues can cause unnecessary stress and lead to disputes regarding security deposit accounting and return.