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John
John, Solicitor
Category: Property Law
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Experience:  10 years legal experience
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I want to break my tenancy agreement earlier but the agency

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I want to break my tenancy agreement earlier but the agency told me that the costs for doing that will be 1200£, claiming that this is what they will charge the landlord for finding a new tenant. There is no mention of these costs at all on my contract. Is this legal?

Hello, I’m a solicitor and I’m happy to help with your question today. There may be delays in responding as I am away helping other customers but I will get back to you as soon as I can. Please bear with me if I need to ask you some clarifying questions. Thank you

Customer: replied 1 year ago.
thanks

Hello, how much is your rent per month?

Customer: replied 1 year ago.
1755
Customer: replied 1 year ago.
What if i find another tenant and there is no idle time between contracts?

Hello, no it isn't legal.

The Tenancy Fees Act that is now fully in force says they cannot charge you extra fees if they agree to surrender your tenancy, as they have been banned! Landlords and agents who are caught charging these fees, risk being fined. There are fees that can be charged but they are capped. and must be reasonable.

Under the new law, for leaving the tenancy early, a fee is charged to cover any financial losses and reasonable costs incurred for terminating your contract before the term is up. But it is capped at no more than the amount of rent you would have paid until the end of your tenancy.

There should be no idle time between contracts, because technically you are still liable for the rent until you leave, which may not be until they find a replacement anyway so they would cover the rent. But if they do let you go before finding someone, you can be charged rent, at what you would normally have paid. The only fees they are able to charge will need to be reasonable ones such as marketing and advertising fees for a new tenant.

Does this clarify?

Customer: replied 1 year ago.
thanks for the reply. They do not present this cost as agency fee to me but for the landlord and in my contract says:
1.51 Breach of Tenancy
(i) The Tenant shall pay the Landlord’s reasonable legal costs and expenses (including VAT) incurred by the Landlord in enforcement or remedy of any breach of the Tenant obligations under this Agreement, whether or not the same shall result in court proceedings.
(ii) The Tenant shall pay the cost of any bank or other reasonable charges incurred by the Landlord if any standing order payment or cheque submitted by the Tenant is withdrawn or dishonoured by the Tenant’s bank.

Sorry, when you say break the tenancy, is this in agreement with them? Or do you mean you are just going to end it regardless of the contract?

If you are going to end the contract, without their agreement, then this is a breach of the tenancy agreement, and as such they can sue you and take court action if necessary. So yes, £1200 in that case can be charged against you, if that is what it will cost them for having to find a new tenant.

If it is a case of them agreeing with you to end it, so a mutual termination or surrender of the tenancy, then no, they cannot charge you that.

Does that clarify?

Customer: replied 1 year ago.
i have talked with the landlord and she is happy to let us leave the house earlier as far as we find someone else to cover. When I said that to the agency they gave me the break down cost(sum of 1200£) that they will charge the Landlord to find a new tenant and according the contract i will need to cover it
Customer: replied 1 year ago.
According to your latest msg does that mean that as far as the Landlord is happy to break the contract earlier(with a replacement tenant) then they cannot charge me the 1200?

Yes, if the landlord is in agreement, it is called surrendering the tenancy, which basically means both landlord and tenant have both agreed that the tenancy will end early. If this is the case, then they cannot charge you any extra fees, as this is not a breach of contract. They can ask you to pay rent as required under the tenancy agreement until a suitable replacement tenant is found, and you will be held liable for rent until the required notice period under the tenancy agreement has expired (if no replacement tenant is found during this time).

But if you breach the contract, and decide to leave without agreeing with the landlord, then yes they can charge you for any costs incurred with that.

I would suggest you return to the landlord to have them confirm with you that you can surrender the tenancy. If they agree, a new tenant can be found and they cannot charge you the £1200. There may be other charges, such as referencing, or marketing costs etc but these are capped and will not be £1200. If the agency is going to charge the landlord, then that is between them, and not you because to as stated, to charge you this would be a breach of the Tenancy Fees Act.

Does that clarify?

Customer: replied 1 year ago.
Brilliant! thank you very much! One last thing, they told me: You signed a tenancy agreement for 24 months with no break clause, which means that there is no mechanism within the contract for you to end the tenancy before. Is this valid? What about surrendering the tenancy? isn't this a mechanism to end it earlier?

Yes, this is valid, if there is no break clause, you cannot end the tenancy until it has expired. It is legally binding.

The only way for you to end the tenancy, without a break clause, is if you surrender the tenancy, and for this to happen, the landlord needs to agree to it.

Does that clarify?

Customer: replied 1 year ago.
Great! How much could be the reasonable charges that i will have to pay the agency? something like 200-300?

It depends what the charges are for, but it must not exceed the financial loss that a landlord has suffered, or reasonable costs that have been incurred by the agent in arranging for you to leave early. But the charge must be no more than your rent.

Glad to have helped. Kindly leave a rating for me by clicking the stars at the top of the page. Thank you.

Customer: replied 1 year ago.
Sorry you confused me, 1200 is less than my rent anyway. My rent is 1755£

Yes, it depends what the charges are for. It must be reasonable. So if they have to pay to market the property, or advertise or do referencing checks for a new tenant this will not be £1200, and more like £50 or so. Keep in mind you have to pay the rent, anyway, so £1755 will still be payable until a new tenant is found. So to charge you £1200 on top of your rent, is unreasonable.

Does that make sense?

Customer: replied 1 year ago.
ok great. Thanks

Pleasure, happy to help. Please click on 5 stars. All the best, John.

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