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Evening Ted,

As a landlord, you can refer to your the TA, either drafted by you or being used by your servicing agent. Then terms of compensation should be clearly indicated within the TA.

FYI
Mike Lim
 96929209 
m52i@yahoo.com
ERA Read More

Dear Ted,

In most cases, as long as there is a break lease case, the security deposit is usually forfeited, as long as there is no clause allowing premature termination of any sort or applicable diplomatic clause.

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Hi Mr Lim,
Usually in a break lease situation, TA clause will indicate landlord has the right to forfeit the security deposit and tenant would also need to compensate the service fees payable to the agent from the landlord for the full term of lease.
But in some scenarios, landlord allow tenant to find a replacement that is acceptable in terms of price and lease and profile and thus , will not forfeit the security deposit as a new replacement tenant is taking over the lease.
There's always room for negotiation between both parties, your agent should be able to advise you on that.

Have a nice day.
Shoan Siew
GPS
 98216829 
shoan.siew@gps.com.sg Read More

Dear Ted,

Apologies if my reply came late.

All tenancy agreements are as unique as the property itself therefore we have to look into the agreement. Forfeiture of security deposit may not be the rightful compensation.

1st, we need to establish if the tenant is lawfully breaking the lease, for e.g. leaving the country, change in company plans. the landlord may refer to the diplomatic clause stated. Assuming that there is a diplomatic clause in the agreement.

If yes,

Rent compensation:

The tenant to pay the rent from current month (i suppose the tenant is breaking the lease before exercising diplomatic) to the month where the diplomatic clause is being exercised + notice period. Usually up to the 14th month of the lease (assuming the diplomatic clause stated 12+2). Afterwhich the landlord will refund the security deposit to the tenant. A handover form is then sign by both parties to discharge both parties from their respective liabilities.

Other compensations landlord may seek:

- The tenant to reimburse the service fee that landlord paid to agent prior to lease commencement. This will be the pro-rated amount base on the remaining outstanding lease period. For. e.g. remaining outstanding lease period is 11 months.Therefore the the prorated calculation will be service fee (GST included) paid multiply by 11/24. That will be the amount the tenant. Kindly note that the landlord can only pursue this compensation if it's mentioned in the TA.

If it's not lawful lease termiantion, then we will need look into the tenancy agreement (TA) if there's any mention on compensation mention if tenant breaks lease. The landlord may pursue the recovery of the whole 24 months and deposit. I also like to share that If the landlord chose to pursue this route, the landlord might just end up with the disappearance of the tenant, forfeiture of the security deposit and a empty property which require repair.

The other option which the landlord can explore is to allow the current tenant to find a replacement tenant. This process is a much tedious process. The landlord can engage the agent to manage all this. All costs involve in finding the replacement tenant is to be borne by the current tenant. The cost for marketing the property, service fee, any repair cost incurred while preparing the property for the next tenant, or maybe the difference between the current rent and new rent, etc.

Whichever route the landlord decides to pursue, my advise to have this resolve in an amicable manner where the tenant can leave in peace and orderly as definitely it's not their wish to break the lease. And the landlord can also take back the property and rent out the soonest possible again.

Regards,
Edmund. Read More

DEPEND ON WHAT IS WRITTEN ON TENANCY AGREEMENT PREVIOUSLY SIGNED >> WHICH BOTH PARTIES ALREADY AGREED >> IF THERE IS A EXIT CLAUSE //
IF NOT CAN NEGOTIATE BASED ON WHAT YOU PROPOSE //
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