Q: In January, my grandson and three of his friends agreed to rent a four-bedroom apartment near the campus starting in August, when school was supposed to resume. They signed the lease in January. The four students each signed separate leases (with parents co-signing), and each student put up two months of rent upfront, totaling $1,600 each.
In April, during spring break, the university announced that due to the COVID-19 pandemic, it would finish out the semester with online-only classes, which my grandson did from his home in Dallas. Meanwhile the university recently decided that the fall semester would be the same, so my grandson and his fellow students will all be at their homes, in Dallas, Denver and Chicago.
All four students are trying to cancel their agreements, but the landlord insists nothing less than 12 months rent ($9,600 each). My grandson is in a high-risk category for COVID-19 because of asthma and a heart condition, so he will not return to Arizona at all this year. Is there any advice you can give us that will allow us to cancel these leases?
A: You raise an interesting question. Should your grandson (and his friends) be allowed to break their lease because the university has switched to online learning? Your second question, whether your grandson’s special health issues should give him special dispensation to break the lease, is also interesting.
While your son or daughter co-signed on renting an apartment for your grandson, we assume that nothing in the lease ties the lease to the school year calendar or anything to do with the university.
The landlord doesn’t know whether your grandson is a student, works for the university or has other responsibilities that are completely outside the university’s purview.
If he had leased housing from the university, we’d assume that entry to and occupancy of the housing would be specifically tied to your grandson’s studies and to the school calendar. If so, many (but not all) universities are refunding some or all of the housing costs to students because they won’t be on campus for some, most or all of the next school year.
The issue of paying for housing and on-campus activities and amenities when students are only attending classes virtually is sticking in the craw of almost every parent and student we’ve heard from or talked to over the past few months. Every college and university seems to be handling the issue differently, and the situation is fluid. When it comes to online classes, some colleges and universities have said they won’t charge room and board if students stay at home, while others are simply offering only a slight discount on the full cost of tuition, room and board for the next school year. The best advice we can give to any parent (or grandparent) who hopes to send their child off to school in the next few weeks is to check in with the administration before you pack up the car.
We understand your grandson and his friends (and their parents) want to terminate the lease, but look at it from the landlord’s perspective. The landlord assumes he has rented an apartment for a year. When the students and their parents signed the lease, they became obligated to pay their rent to the landlord for the next 12 months. In exchange, the landlord took the apartment off the market and may have lost out on other potential tenants.
Someone is going to lose out in this arrangement due to the pandemic. The question is, who bears the risk and responsibility for the payment?
We’ve seen stories in the news of retailers telling their landlords that they won’t pay rent and have been forced to close up shop permanently. We know of landlords who are out hundreds of thousands of dollars from tenants who simply didn’t pay rent. Your grandson and his friends, on the other hand, have the ability to live in the apartment regardless of the pandemic. They could do classes virtually from that apartment, instead of from their family homes.
Let’s look at it from the reverse perspective: What if your grandson wanted to live in the apartment and the landlord suddenly didn’t want them there for some reason and wanted to kick them out? In that case, you’d vigorously protest.
Ultimately, the rights and duties of the tenant are contained in the lease agreement your grandson and his friends and their families signed. It contains provisions that cover what will happen if you terminate the lease early, fail to pay rent or walk away from the deal. That same document may contain provisions that will help you in case the lease provides that your son has to be a student, must attend classes on campus or somehow states that the lease is valid only as long as your son is a student on campus.
So, have your grandson and his parents take a close look at the lease, and perhaps engage the services of a local real estate attorney (in Arizona) to help. That attorney can help you see if there’s anything in the lease that would give you the right to terminate the lease early. For example, it’s possible that the town in which the university is located has mandated that school housing and apartments close during the school year, giving you the opportunity to terminate the lease. It’s unlikely, but you’ll have to talk with an attorney who understands the current state of COVID-19 regulations to get more information.
You’re lucky that your grandson has an individual lease with the landlord. We know many others who have co-signed with their roommates, so that each set of parents is responsible for the entire lease payment in case someone doesn’t pay. If that’s how your lease was structured, your grandson and his parents could be on the hook legally for the entire $38,400 due under the lease, not just their $9,600 share.
We’re sorry your grandson has health issues, but unless a landlord has it in their nature to let a person out of a lease, the tenant is stuck and has to abide by the terms and pay the rent due as stated under the lease. Good luck.
(Ilyce Glink is the author of “100 Questions Every First-Time Home Buyer Should Ask” (4th Edition). She is also the CEO of Best Money Moves, an app that employers provide to employees to measure and dial down financial stress. Samuel J. Tamkin is a Chicago-based real estate attorney. Contact Ilyce and Sam through her website, ThinkGlink.com.)