There are several crucial legal factors both the landlord and tenant must address before signing a lease in North Carolina. One of the most important ones is dealing with special rental provisions like early terminations.
North Carolina law has certain rules surrounding breaking a lease before it expires, and this page will cover everything that landlords and property managers should know about this process. This will help them avoid legal misunderstandings and concerns in the future.
First, let's address North Carolina's rules surrounding lease notices. While tenants aren't required to provide notice for a fixed-term lease, they must do it for a periodic one.
Here's an overview of each necessary notice period:
- Weekly Lease - Two days of written notice.
- Monthly Lease - Seven days of written notice.
- Yearly Lease - 30 days (or more) of written notice.
Those who want to end a lease for a manufactured home must provide at least 60 days of notice before the next rent period begins. This period of notice applies to any tenancy term involving this type of property.
Breaking A Lease Early
Tenants, technically, can break a lease in North Carolina for any reason. However, not following the terms specified in the lease can cause them to pay a few penalty fees.
However, there are a few scenarios where a tenant may be able to break a rental agreement without paying extra fees.
The following section will cover all of the common reasons for breaking a lease.
Active Military Duty
Tenants starting active military duty will get protected by the Servicemembers Civil Relief Act (SCRA). Specifically, they'll get protected from the day they begin duty until 30-90 days after they get discharged.
In some cases, the tenant may be able to break their lease early if they're able to prove they entered duty after signing the lease. On the other hand, they should prove that they will remain on duty for at least the next 90 days.
Tenants starting active military duty can break their lease in North Carolina by sending a notice letter with an attached copy of the deployment letter.
Those who want to break their lease with this method can only do it 30 days after the next rent period begins.
Now, who is considered a "Servicemember"? It often involves members or commissioned corps of the:
- Public Health Service
- National Oceanic and Atmospheric Administration (NOAA)
- Activated National Guard
- Armed Forces
Early Termination Clause
The "Early Termination Clause" is considered the "healthiest" method to break a rental agreement without any misunderstandings.
Tenants who want to end their lease agreement in North Carolina should first review their document and look for language that outlines what they can do if they want to end their tenancy early.
Typically, tenants may be able to break their lease agreement in North Carolina by paying a fee. Those fees are often specified in the "Early Termination" clause.
Even if there's an "Early Termination" clause in the lease agreement, the tenant may want to negotiate with their landlord to see if they can come up with a mutual termination agreement.
If both the landlord and tenant agree on a mutual termination, they must get everything in writing and then sign the document. This could relieve the tenant from paying penalty fees.
North Carolina has particular safety and health codes all landlords must follow if they want to avoid problems with their rental property.
State law specifies that landlords must include the following:
- Facilities and appliances in good working order.
- Compliance with current applicable housing/building codes.
- Common areas in a safe condition.
- Smoke alarms in good condition.
- At least one operable carbon monoxide alarm.
Furthermore, landlords who are charging their tenants for water/sewer services must evaluate whether they're supplying water that exceeds the maximum contaminant level in the North Carolina Drinking Water Act.
Landlords can get this information from their water system provider or another source they trust. If they find out they're providing water that exceeds the recommended levels, they must provide proper notice to their tenant.
Finally, landlords have the legal responsibility of fixing any hazards considered "imminently dangerous," which include damaged roofs, flooring, wiring, and more.
The state of North Carolina offers protection for victims of domestic violence, stalking, or sexual assault. If the tenant is able to prove they're a victim of domestic violence or any other similar case, they may be able to break a lease early.
To break a lease in North Carolina under this provision, tenants must provide a copy of the document that proves their status. This includes a report from a medical professional, a file from a law enforcement agent or court, or any documentation from a domestic violence program.
Now, keep in mind that tenants can only terminate their lease within 30 days of reporting the sexual assault.
On the other hand, the tenant can request to get their locks changed at their expense. In these cases, the landlord will have 48 hours to do it if the perpetrator lives in the rental property and 72 hours if they live elsewhere.
Tenants can change the locks themselves if the landlord fails to do it within the specified timeframe, but they must give them a copy of the new keys.
Landlords shouldn't enter the property without providing at least 24 hours of notice. On the other hand, they can't change the property's locks without the tenant's consent.
If the landlord repeatedly violates these conditions, they would be "constructively evicting" their tenant, meaning they would be relieved of their lease duties.
The following is a list of additional reasons tenants may use to break a rental unit lease in this state. While these arguments may be valid, they may need to get approved by a court first:
- The landlord repeatedly violated the agreement terms.
- There weren't any accommodations in the rental unit for people with qualified disabilities.
- The landlord or tenant used an illegal or unenforceable contract.
- The landlord failed to follow mandatory disclosure laws.
Yes, there are a few reasons that may not be enough justification for breaking a lease in North Carolina. Trying to break a lease under any of these arguments could cause the tenant to pay penalties unless they come to a mutual agreement with their landlord.
These unjustifiable reasons include the following:
- Relocating for another job or school.
- Moving in with a partner.
- Separation or divorce.
- Criminal activity around the property.
- Moving someplace else to be closer to a family member or friend.
- Buying a new house.
- Upsizing or downsizing.
Delivering a Notice Letter Legally
You should always include information surrounding delivery methods for notice letters to avoid problems with your tenant. Here are the most common methods used in the state:
- Serving the letter in person.
- Sending the letter via certified mail.
- Leaving the letter at the landlord's address.
Landlords are free to choose the method they feel the most comfortable with. If the tenant fails to provide proper notice to their landlord, they could pay penalties when they try to break the lease.
Landlords are encouraged to include an "Early Termination Clause" in their lease to protect themselves if the tenant ever tries to leave the rental unit before the term expires.
In that clause, the landlord must include all the requirements/consequences of breaking the lease. As mentioned before, landlords may be able to charge a penalty fee if the tenant fails to break the lease without a valid reason.
Overall, these penalty fees are used to cover all the rent owed at the time and any re-rental expenses the landlord may have to cover.
Some landlords keep the tenant's security deposit to cover their lost money. However, if they can't cover everything with the deposit, they may try to file a lawsuit through a small claims court. North Carolina has a $5,000 limit for these particular claims.
Can Landlords Prevent Tenants from Breaking a Lease Early?
Landlords may be able to avoid early lease terminations if they include a clause that covers all the provisions needed for this case. On the other hand, the tenant may negotiate with their landlord to see if they can come up with a new agreement.
Some landlords allow their tenants to help them find a replacement tenant. In these cases, the tenant would only be liable for the amount of rent that the landlord lost when the property was vacant.
While an early lease termination can get overwhelming for you, keep in mind that tenants can break the lease for any reason. However, if you include penalties for breaking a lease in your agreement, then you may be able to recover some of the money you lost.
Finding a Replacement Tenant
Yes, North Carolina landlords are required by law to make a reasonable effort to re-rent their unit in order to "mitigate damages."
If the landlord fails to re-rent the property to a replacement tenant, the previous one will still be liable for all the rent they owe under the agreement they signed.
Subletting The Unit
Tenants may be able to sublet the rental unit to cover the rent payment they owe to the landlord when they move out. However, they can only do it with the landlord's permission.
If the lease already has a clause that outlines the conditions to re-rent the unit to someone else, then the tenant may be able to start the process right away. On the contrary, they may have to ask for the landlord's approval.
Landlords are only able to refuse subletting requests under reasonable/appropriate arguments.
Tenants who want to sublet the property must send a letter to their landlord that includes everything they should know about the subletting term, including the proposed subtenant's name, their new address (if applicable), their written consent, and their current permanent address.
Even though there are several options for tenants to break a lease in North Carolina, you should be fine as long as you're as clear as possible with your special rental provisions.
Some people, in an effort to make things easier, may decide to work with an experienced property management company to help them come up with an appropriate lease, this isn't necessary if you prepare accordingly. If you take your time, you can do a free rental pricing analysis on your own, draft a comprehensive lease agreement, and more.
The information in this article will help you cover early lease terminations, but if you need more help with your rental process, you can check out our other resources for North Carolina landlords below or download a rental form.
When Do Tenants Need to Give a 30-day Notice in North Carolina?
They need to provide a 30-day notice if they want to end a yearly lease with no specified end date. However, they can provide more notice if they want.
Can Tenants Break a Lease Without Penalty in North Carolina?
Yes, but they would have to meet certain requirements or negotiate with their landlord to come to a mutual termination agreement.
What Penalties Can Landlords Enforce?
Landlords can charge penalty fees to cover some of the owed rent or re-renting expenses, as tenants are required to pay rent for the full lease term. Some landlords may decide to take the security deposit or sue the tenant.
The most appropriate penalty will depend on the case and whether the landlord and tenant negotiated a mutual termination or not.
What Happens If the Tenant Refuses or Fails to Send Proper Notice Before Leaving the Rental Property?
The landlord may be able to file a lawsuit against the tenant, as not providing notice in time would count as breaching the law and the lease's terms.
- North Carolina Eviction Laws: The Process & Timeline In 2023
- North Carolina Landlord Tenant Laws & Rights for 2023
- North Carolina Security Deposit Laws | Deductions & Rights
- General Statute Sections - North Carolina General Assembly
- NCGS - 42-14
- NCGS - 42-42
- Drinking Water Act for North Carolina
- Servicemembers' Civil Relief Act (SCRA) | United States Courts