Breaking a Lease in Michigan: Landlord/Tenant Guide 2024

Understanding the implications of breaking a lease is crucial for landlords and tenants in Michigan. Navigating the ins and outs of this unfortunate situation can be a make or break for both parties.

While there are many legal reasons to break a lease, knowing how to do so without incurring penalties is essential. To do this, you’ll need to follow Michigan landlord-tenant laws closely.

TurboTenant’s landlord software is your definitive resource for managing Michigan lease agreements and guiding you through challenging situations like early lease termination.

Our article offers a step-by-step process with strategies to minimize the financial impact and potential consequences for both landlords and tenants who must end their rental contracts early.

Legal Reasons for Breaking a Lease in Michigan

In Michigan, landlords and tenants must adhere to specific laws and statutes. While a lease agreement is legally binding, there are circumstances where a tenant or landlord can break a lease without penalty.

Here are some legally acceptable reasons for breaking a lease in Michigan.

Early Termination Clause

Some leases include a clause that allows for early termination under specific conditions. Each situation is different, but a typical example might involve paying a fee or providing a certain amount of notice. You must read your contract thoroughly and understand every section before deciding.

Active Duty Military

Per the Servicemembers Civil Relief Act 50 USC App § 535, active duty military members who receive a permanent change of station or deployment orders can legally break their rental contracts. However, state and/or local laws dictate notice requirements aand must follow a specific protocol.

Landlords must ensure the service member provides a written termination notice and a copy of their military orders.

Domestic Violence

Victims of domestic violence, sexual assault, and stalking are legally protected and can break a lease early without penalty in Michigan. MCL 554.601b requires the victim to follow specific procedures, like obtaining a restraining order or police report, and provide it to the landlord.

Landlord Harassment

If a landlord violates a tenant’s privacy, intimidates, threatens, or harasses their leaseholder, the tenant may be able to leave their rental contract prematurely.

Examples of this type of harassment:

• Using force or threatening force to prevent a tenant from entering or leaving the premises.
• Boarding up the premises to prevent tenant entry
• Changing the locks to prevent entry into the unit.
• Removing, withholding, or destroying tenant property
• Shutting off essential utilities like water, gas, or electricity.
• Michigan laws prohibit retaliation by landlords when their tenants make complaints to government agencies.

Inability to Live Independently

If the tenant becomes unable to live independently, they may break their lease but must provide the landlord with a certified statement from their physician.

Uninhabitable Unit

Even if it’s not written into your lease, Michigan Law MCL 554.139 states that upon entering into a rental agreement, the landlord implied that the premises are habitable for use. This concept is called the Implied Warranty of Habitability.

If a landlord fails to address essential maintenance safety issues or allows the property to become uninhabitable, the renter may have grounds to break their lease.

Here are some examples of issues that, if not addressed by the landlord promptly, can constitute an uninhabitable dwelling:

• Mold
• Essential utilities are not functioning properly
• Bad furnace
• Plumbing and septic issues
• Holes in the roof not caused by the tenant
• Electrical problems
• Unsafe conditions

You may feel you have a right to break your lease because of one of the conditions above (or another safety or maintenance problem).

Most tenants seek relief in the following two ways:

• Repair and Deduct: Under common law and Michigan Housing Law MCL 125.534(5), tenants can repair the building themselves and deduct the amount from any rent or unpaid rent. The tenant must give the landlord ample notice of the fault beforehand and give them reasonable time to cure before taking action.

• District Court: Tenants must request permission to terminate a lease early due to unsafe conditions. If denied, they can seek relief in court by claiming the landlord violated the Implied Warranty of Habitability.

You must provide proper documentation and follow any associated timelines when invoking your rights and breaking your lease.

Make sure to provide the landlord with written notice. Here are some expected timelines:

• Weekly Leases: 7 Days
• Monthly Leases: 30 Days
• Yearly Leases: 1 Year

How to Break a Lease in Michigan Without Penalty

In Michigan, breaking a rental contract without incurring penalties typically requires adhering to specific legal grounds and procedures. Here’s a step-by-step guide:

• Review your lease agreement: Carefully read and examine your rental contract for any early termination clauses or provisions that outline the conditions under which you can terminate the lease without penalty.

• Identify a legal reason: Determine if you have a legal or valid reason for breaking the agreement, such as the reasons outlined in the previous section.

• Talk to your landlord: Notify your landlord in writing of your intent to terminate your contract. Make a special note to include the reason and the effective date of the termination. Even though these situations can hit close to home, remember to keep all communications professional and refrain from allowing emotion to be a factor.

• Keep thorough documentation: The party that keeps the best records usually wins these disputes. Keep a copy of all notices, emails, and requests or complaints you have lodged. You never know when you’ll need that information later.

• Mitigate damages: To minimize your financial responsibility, you should find a new tenant to take over your lease or sublet the unit. You’ll hedge your losses if things don’t go your way with the landlord.

• Negotiate: Positive, cordial communication will help you negotiate a better exit for both parties. Your landlord may be willing to work with you, especially if you help find a replacement tenant.

How to Minimize Your Financial Responsibility When Breaking a Lease

Here are some practical tips and strategies for lowering your financial liability and potential consequences when you end a lease agreement early.

• Subletting: Sometimes, your lease allows for subleasing to a third party. That means you have to find someone to lease the rental from you.

• Finding a replacement tenant: While not always an option within the language of your contract, finding a replacement tenant can aid in negotiating early contract termination.

• Negotiate with your landlord: Landlords are often more understanding than you think.
  Negotiate with them early to reduce penalties or forfeit part of the rental deposit.

Pro Tip: The less painful your situation is for your landlord, the less inclined they’ll be to pursue rental penalties.

Consequences of Breaking a Lease in Michigan

As a tenant, you need to understand the impact ending your rental agreement early will have on your life.

Here are a few ways that your decisions can affect you:

• Financial penalties: The landlord can typically charge you for unpaid rent, advertising costs, and other expenses associated with re-renting their unit.

• Credit score damage: Unpaid rent and fees don’t just disappear. Legal judgments resulting from a broken rental contract can negatively impact your credit score.

• Eviction record: A formal eviction can be filed if you don’t follow the proper procedures. That is true even if you leave your lease agreement voluntarily. Evictions carry long-term implications.

• Legal action: In some circumstances, landlords may sue you for damages and unpaid rent. A legal judgment can mean wage garnishment.

As a landlord in Michigan, you cannot terminate a lease early without a valid reason, such as the tenant’s breach of the lease. Potential consequences include:

• Financial penalties: The tenant may be entitled to damages, including the cost of finding a new place to live, moving expenses, and any rent they have already paid for the remainder of the lease term.
• Legal fees: The tenant may also be entitled to reimbursement for their expenses if they have to take legal action to enforce their rights under the lease.
• Damage to reputation: A landlord who breaks a lease early without justification may damage their reputation and make it easier to rent out their property in the future.
• Loss of future rent: If the landlord cannot find a new tenant to replace the one they evicted, they may lose out on future rent payments.
• Eviction: In some cases, the tenant may be able to file a counterclaim for eviction against the landlord, which could result in the landlord being evicted from their property.

Enforcing Penalties for Breaking a Lease

Landlords in Michigan have a few options for enforcing the penalties associated with breaking a lease.

They can:

• Deduct the penalties from the tenant’s security deposit.
• Sue the tenant for breach of contract in small claims court.
• Report the tenant to a credit bureau, which could damage their credit score.
• Obtain a court judgment against the tenant, which could result in wage garnishment.

To increase their chances of success in enforcing lease penalties, landlords should:

• Have a well-drafted Michigan lease agreement outlining the penalties for breaking the lease. Take time to understand every provision.
• Give the tenant written notice of the penalties before they break the lease.
• Keep detailed records of all communications with the tenant.
• Consult an attorney if they have questions about enforcing the penalties for breaking a lease.

Landlord Rights and Responsibilities

As a landlord, when a tenant breaks a lease, you have the right to seek compensation for any financial losses incurred.

This includes:

• unpaid rent
• Advertising or listing costs for finding a new tenant
• any repairs or costs associated with restoring the property to its original condition

Landlords may keep the renter’s deposit to offset some of these costs and take the tenant to small claims court to collect the remaining balance.

The landlord has some responsibilities in this situation: you must mitigate your damages by making reasonable efforts to find a new tenant as soon as possible.

Additionally, you must comply with all applicable Michigan laws and regulations when terminating a lease agreement.

Tenant Rights and Responsibilities

Tenants have specific rights and responsibilities when a landlord prematurely nullifies a lease.

• Tenants generally have the right to receive their security deposit back minus any unpaid rent or damages.
• Tenants may also be entitled to compensation for moving expenses and other costs related to finding a new rental property.

Tenants have specific responsibilities when a landlord terminates their lease early. Some of these responsibilities include:

• Paying any outstanding rent or fees.
• Leaving the rental unit in good condition.
• Returning the keys to the landlord.
• Tenants must comply with any other requirements outlined in their lease agreement or Michigan law.

Preventing Tenants From Breaking The Lease

To discourage tenants from breaking leases, landlords can:

• Screen tenants carefully before signing a lease
• Offer long-term leases with incentives
• Provide a clean and well-maintained rental property
• Be responsive to tenant requests and concerns
• Build a good relationship with tenants

Effective communication prevents disputes and fosters positive landlord-tenant relationships.

Legal Help for Landlords and Tenants

Michiganders seeking legal assistance should refer to the resources listed near the bottom of our Michigan landlord-tenant laws page or consider visiting the following websites:

• Michigan Legal Help: Provides free legal information and resources for Michigan residents with housing issues and connects those who qualify with low-cost and pro bono lawyers.
• Michigan State Bar Foundation and Legal Aid of Western Michigan: Offers a free legal hotline for Michigan residents facing housing and landlord/tenant disputes.
• Michigan Attorney General’s Office: Provides information and resources on landlord-tenant rights and responsibilities in Michigan.

How TurboTenant Can Help

Let’s be real: Nobody wants to deal with a broken lease. TurboTenant helps landlords avoid that drama.

Here’s what TurboTenant’s rental management software can do for you:

• Screen those applicants: Find reliable renters who will keep you from ditching you mid-lease.
• Generate ironclad lease agreements: Set the rules and keep everyone on the same page.
• Manage repairs like a pro: Happy tenants are less likely to bail.
• Receive payment on time, every time: Digital rent payments make it easy for tenants to keep up.

Sign up for a free TurboTenant account today and say goodbye to Michigan lease-breaking headaches.

Disclaimer: TurboTenant does not provide legal advice. This material has been prepared for informational purposes only. All users are advised to check all applicable local, state, and federal laws and consult legal counsel should questions arise.

Breaking a Lease in Michigan FAQs