How To Draw Up a Mutual Lease Termination Agreement

Standardized Legal Documents How To Draw Up a Mutual Lease Termination Agreement

Mutual Lease Termination Agreement in a Nutshell

Lease agreements are binding legal documents that both landlord and tenant need to respect. But what happens if the involved parties want to terminate the lease consensually? This delicate situation calls for a mutual lease termination agreement.

If you want to learn more about this contract, DoNotPay is at your disposal! We will also show you how to create a top-notch mutual lease termination agreement without hassle!

What Is a Mutual Lease Termination Agreement?

A landlord and tenant can decide to terminate a lease agreement at any point. One way to do it is to sign a mutual lease termination agreement. This contract is the result of negotiations between both parties and should protect their respective interests. Before creating and signing a mutual lease termination contract, the concerned parties must agree on the terms of ending the lease.


What Are the Most Common Reasons for an Early Termination?

People often have to terminate a lease early because their circumstances change. Here are the most common reasons landlords and tenants decide to take separate ways before the lease expiration date:

Reasons for Terminating a Lease Early
Landlords Tenants
  • Selling the property
  • Foreclosing the unit
  • Renovating the premises
  • Falling under eminent domain for public use
  • Suspecting tenants for illegal behavior 
  • Evicting the tenant for not paying rent or breaking the lease
  • Having the property destroyed by a natural disaster
  • Looking for a space that allows pets or is more convenient for children
  • Leaving for a new job or marriage
  • Being subjected to unsafe living conditions
  • Living in partially unusable premises 
  • Leaving for military services
  • Having health problems or a sick family member

The Benefits of Creating a Mutual Lease Termination Agreement

A mutual lease termination agreement can be beneficial for the landlord and tenant, as described in the table below:

Creating a Mutual Lease Agreement

Cause  Benefits for the Landlord Benefits for the Tenant
Tenant facing eviction
  • Sets a quicker date for repossessing property than the eviction process would
  • Saves the landlord from expenses of filing for eviction and hiring a lawyer
  • Determines a convenient move-out day
  • Avoids an eviction in their rental history
  • Maintains eligibility for rental subsidies
Tenant moving out before the end date
  • Allows a smooth return of the property
  • Determines if the tenant owes any money 
  • Sets a precise move-out date 
  • Establishes a payment schedule for returning the money owed 

Key Elements of a Mutual Lease Termination Agreement

While every contract is unique, they must all have a specific structure. After including the required sections, you have to adjust the contract to both parties’ requirements and particular state laws. Here is what a standard lease termination agreement should include:

  1. Personal informationThe contract should contain full names of involved parties
  2. Property detailsThe agreement must include the full address (including city, state, and ZIP code) of the rented property
  3. Original rental agreement infoThe landlord should provide the names and start and end date of the original agreement
  4. Departure dateThe contract must include the tenant’s exact move-out date 
  5. Contact addressBoth parties have to provide addresses for receiving the security deposit or future notices 
  6. Termination reasonsThe agreement must outline the reasons for terminating the lease

How Can I Create a Mutual Lease Termination Agreement?

You can create a mutual lease termination agreement by:

Hire a Lawyer To Draft a Contract 

This is one of the most reliable ways to create a mutual lease termination agreement. Lawyers are familiar with the terminology, state laws, and potential legal problems. 

Mutual lease termination agreements are sensitive and need to be as precise as possible. 

Attorneys ensure the elements in your contract not only correctly describe your intention but are also legally enforceable. The trouble is that not many people can afford a lawyer since their services are pricey.

Download an Online Contract Template

Online contract templates are free and easy to access. They mostly contain all crucial sections of a mutual lease termination agreement. The downside is that they offer general terms and can’t be used in specific situations. If you decide to go for a contract template, make sure to find a professional website and pick the template closest to your requirements. 

Create an Agreement Yourself

The cheapest option is to write the contract yourself. You don’t have to use complicated legal terms. Contracts written in simple English are acceptable in court. Before you start writing the agreement, you should establish your conditions and adjust them to your state’s laws. 

You may want to consider asking for legal advice after you finish. It will not cost you as much, and you will have confirmation that you created an enforceable document. 

Need Help Writing Other Legal Documents? DoNotPay Can Assist!

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DoNotPay has developed a Standard Legal Documents service to help you create numerous contracts, including:

Business Contracts Real Estate Legal Documents Other

Our app uses the information you provide to generate a personalized contract that meets all legal requirements. 

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  1. Type in the name of the document in the Search field
  2. Answer a few questions
  3. Wait for your contract to arrive

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