Homefront: ‘I lost my job and can't pay the rent. Can I end my lease early?’

The tenant will have to pay the landlord a penalty, but they could ask for a waiver or payment holiday

A rental contract will determine whether a tenant is able to end the lease early and if any penalties will apply. Getty Images
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I have just lost my job. However, I am on a 12-month lease for my apartment and my next rental payment is due at the end of this month. My employer is only paying me up to today, which means I may not have enough money to cover the next rent. Can I end the lease early? Please advise me on what to do next. LC, Dubai

I would urge you to first look carefully at your rental contract, which will determine whether you are able to end your lease early and if any penalties will apply.

Talking about being charged a penalty for early termination is not helpful in your situation, but if this clause is in your contract, it will not just disappear. I suggest you try to have a face-to-face meeting with your landlord to explain what has happened and see if you both can come to a compromise.

Perhaps the landlord can offer you a payment holiday, allowing you to seek alternative employment during the time, or perhaps give you a discount or waive the penalty amount altogether.

I bought an off-plan villa on an instalment basis. The villa is now ready for possession and half of the instalments are yet to be paid. The developer is asking me to take possession of the property.

I have sufficient money in my bank account to pay the full amount in advance instead of paying in instalments and the contract allows me to do so. However, the developer has levied a condition that I am not allowed to rent or sell the villa until the full payment is completed. The company says if I do not take possession, there will be a monthly fine imposed.

Is it a good idea to pay for the villa in full or continue paying in instalments? I am worried about a second wave of the coronavirus pandemic and the possible need for cash in a worst-case scenario. QM, Abu Dhabi

The terms and conditions of your villa purchase will be outlined in total via the sales and purchase agreement (SPA) that you have presumably signed. It is clear that your agreement allows for you to continue to pay for the villa on a post-handover payment plan basis. Therefore, the answer to your question whether you should pay for the villa in cash now that you have enough funds remains your personal choice.

Ask the developer if there is some form of discount from the sales price should you pay it off now rather than follow the post-handover payment plan

To help you make this decision, I would ask the developer if there is some form of discount from the sales price should you pay it off now rather than follow the post-handover payment plan? If not, the only advantage to you would be that you can rent or sell it after the 100 per cent payment has been made, assuming this is still a relevant clause.

I understand your concern about liquidity during these uncertain times. I would suggest you keep to the payment plan and, therefore, your cash stays with you. However, if you need to rent the villa or sell it, you will have to pay the 100 per cent to be able to do so.

Mario Volpi is the sales and leasing manager at Engel & Volkers. He has worked in the property sector for more than 35 years in London and Dubai. The opinions expressed do not constitute legal advice and are provided for information only. Please send any questions to mario.volpi@engelvoelkers.com