Not sure how to terminate a property management contract? Terminating a contract can be tricky but, with the right strategy, you can come away on top.
You may be dissatisfied with the service you have received. As a property management contract, there are obligations on both sides; to each of the signatories. You must ensure that, in ending the contract, you are not in breach of the stated conditions.
Terminating the contract, as with any other contract, means knowing your rights and responsibilities. Here, we go through the main elements that you need to consider to successfully, and legally, end the contract.
Consult the termination clause
Take out the contract and learn more about the termination clause. This clause may require you to deliver your notice within a defined period, which could be 30 days, 60 days or 90 days. Failure to give notice within these defined periods may result in breach of contract.
If you continue to persist in ending the agreement, you may face a legal battle. If you do not, the contract termination request may be refused. That’s why it’s important for clients to understand the specifics of the termination clause before they sign the contract.
In addition, keep an eye on cost. Terminating a management contract may incur a fee, or fees, as set out in the agreement.
It’s essential that you keep good records. To terminate a property management contract, you may need solid, written evidence to prove that you gave notice within the window of opportunity.
Don’t rely on word of mouth; it stands to no legal scrutiny. Instead, formulate your notice in writing, preferably on certified mail. Request a return receipt, too. Dates matter! Don’t keep records if they are not clearly dated and signed. In addition, be sure to specify precisely when the contract is set to be terminated.
Knowing if you need cause
If you hope to terminate a property management contract, you must know whether you have cause to do so.
There are two possibilities – that you have cause or that you do not have cause. If you do not have cause, you can proceed with terminating the contract at your convenience within the terms set out in the management agreement.
If the contract specifies the need to have cause, you must have a valid reason, as set out in the agreement, to terminate the contract. For example, the reason may be that the property manager did not perform a given duty in line with state regulations. If you have no reason but still hope to terminate the contract, the other party may either side-line your request or file a lawsuit for breach of contract.
Managing tenants and deposits
Tenants must be informed that you’ve decided to switch property management companies. They have a vested interest in this knowledge, not least because their security deposits will be held by the next management agency.
Don’t forget – it’s the responsibility of the current property manager / agency to transfer security deposits to either you or the other management agency. Those deposits must be stored correctly, as stated in local and state legislation.
In addition, tenants need to know who to contact in cases where maintenance issues arise, for instance. Again, don’t rely on word of mouth. Always keep communication in writing, dated, signed and on record.
Severing ties never has to become personal. While there may be valid professional reasons for you to cut links with your current property manager, that should not color your behavior. Stay professional throughout. Be prepared to wait one or two months for funds owed to you. Establish meaningful communication with the outgoing manager to receive the necessary documents and statements now owed to you. Staying professional means reducing unnecessary stress while also ending the relationship in a calm and productive manner. It makes life easier for everyone.
If you want to terminate a property management contract in Las Vegas but are unsure how best to achieve this, contact Triumph Property Management today. Our team are on hand to deal with your request and help you with your investment needs.