Early termination fee equal to three months' rent
Three months' rent is excessive. Courts may not enforce it as a penalty rather than a reasonable estimate of damages. Push back.
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What it actually means
Three months' rent exceeds what most landlords spend to find a replacement tenant. It's punitive, not compensatory.
Many states limit liquidated damages to actual losses. If the landlord re-rents in two weeks, three months is unenforceable.
What it looks like in a lease
"Early termination shall require 90 days' notice and payment of a fee equal to three (3) months' Rent."
What to watch for
- Whether mitigation duty is mentioned
- Whether fee is in lieu of remaining rent or additional
How to negotiate it
Counter with one month. If they refuse, ask for a re-rental credit: any rent collected from a new tenant reduces your fee.
When it crosses into a red flag
- No mitigation language
- Fee plus remaining rent
- Fee plus deposit
Frequently asked questions
Can I challenge this in court?
Yes — excessive early termination fees are often struck down as penalties. Document landlord's actual costs.
Want to know how this works in your specific state? Read the Breaking a lease early guide, or pick your state from the guide index.
Related clauses
General information, not legal advice. Clauses are interpreted differently across states and courts. For a binding interpretation of your specific lease, consult a licensed attorney in your state.
