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    Default What Happens if Your Landlord Sells the Rental Property After You Break Your Lease

    My question involves landlord-tenant law in the State of: Indiana


    We would like to break our two year lease. We have a year left. When we told our landlords, they said they are not interested in renting the house anymore and instead are going to sell. The lease amendment they sent to us has us paying rent until the day before the new owner moves in. Do we still owe rent if they no longer have the intention of renting it?

  2. #2
    Join Date
    Oct 2014
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    Default Re: Does "Mitigating Damages" Include Selling Your Rental House

    Quote Quoting tenantinindiana
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    My question involves landlord-tenant law in the State of: Indiana


    We would like to break our two year lease. We have a year left. When we told our landlords, they said they are not interested in renting the house anymore and instead are going to sell. The lease amendment they sent to us has us paying rent until the day before the new owner moves in. Do we still owe rent if they no longer have the intention of renting it?
    You have a contract with the landlord. You are obligated to pay that rent as provided in the contract even if the landlord does sell unless the landlord agrees to terminate it. The landlord could, for example, transfer the contract to the new property owner if the new owner if you both don't agree to terminate it earlier.

  3. #3
    Join Date
    Jul 2018
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    Default Re: Does "Mitigating Damages" Include Selling Your Rental House

    You owe rent until the end date of your lease or whatever other date you and your landlord agree to.

    If you leave without any sort of agreement, your landlord may sue you for the balance under the lease. You can assert as an affirmative defense that your landlord has/had a duty to mitigate by finding a replacement tenant. If the landlord chooses not to find a replacement tenant and, instead, chooses to put the house on the market, that may impact his ability to recover from you. My guess is that, in most cases, the court would award the landlord a judgment based on how long it reasonably would have taken the landlord to find a replacement tenant.

  4. #4
    Join Date
    Mar 2013
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    Default Re: Does "Mitigating Damages" Include Selling Your Rental House

    Quote Quoting tenantinindiana
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    We would like to break our two year lease. We have a year left. When we told our landlords, they said they are not interested in renting the house anymore and instead are going to sell. The lease amendment they sent to us has us paying rent until the day before the new owner moves in. Do we still owe rent if they no longer have the intention of renting it?
    Indiana does not have a statute addressing a landlord's duty to mitigate. Indiana courts, instead, apply a common law doctrine as explained by the Indiana Court of Appeals in Nylen v. Park Doral apartments:

    The doctrine of mitigation of damages creates an obligation on the part of the landlord to use such diligence as would be exercised by a reasonably prudent man under similar circumstances to re-let the premises, if possible, in order to mitigate damages resulting from the tenant's breach of lease. State v. Boyle (1976), 168 Ind. App. 643, 646, 344 N.E.2d 302, 304. The obligation exists even if there is no mandatory re-letting clause in the lease. See Hirsch et al. v. Merchants Nat'l Bk. (1975), 166 Ind. App. 497, 336 N.E.2d 833. Further, courts have recognized and enforced the doctrine of mitigation of damages while at the same time sustaining savings clauses.
    Id.; see also Grueninger, supra, 413 N.E.2d 1034.
    https://scholar.google.com/scholar_c...en&as_sdt=4,15

    The prior cases cited say pretty much the same thing and decide whether or not the landlord mitigated.

    If the landlord takes the property off the rental market, thus failing to mitigate, you owe him nothing from that day forward.

    What you have to understand, though, is that breaching your lease is a bad thing which could result in financial consequences to you. In your case the landlord is giving you a choice of essentially paying a lease breaking fee or taking your chances that he decides to re-rent, instead of sell, and then sues you for the rent from the time you leave until the time he re-rents, which could take anywhere from weeks to months depending on the rental market and you would certainly owe for that period.

    And, as T-M notes, he can sell it as a rental property with you as occupant and have the new owner assume your lease. Doing that would obligate you to the remaining year of your lease.

    It's up to you whether you want to accept the amendment or just move out and take your chances.

    One thing I suggest is not to leave the amendment open ended. Offer, instead, to limit your obligation to, say, one month's rent.

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