Lease Guarantee: Protecting Inland Empire Property Owners From Duplicate Fees When Tenants Break Their Lease

Lease Guarantee: Protecting Inland Empire Property Owners From Duplicate Fees When Tenants Break Their Lease

Part 7 of 8: Service Guarantee Series

Life happens. Even to great tenants.

They signed a lease. You had a stable resident. Everything was going according to plan. Then suddenly, life throws them a curveball – a job loss, a family emergency, a health crisis – and they need to break their lease early.

Now you’re facing thousands in lost rent, turnover costs, and potentially duplicate placement fees. But should YOU be the one bearing all those costs when you didn’t cause the problem?

The Reality of Lease Breaks

First off, lease breaks are actually pretty rare.

In our experience managing hundreds of Inland Empire rental properties over the past 20+ years, the vast majority of residents honor their commitments. They either renew their lease or give proper notice when they’re ready to move on.

That’s what good screening is supposed to produce – stable, responsible residents who understand and respect their lease obligations.

But sometimes, life gets in the way:

• A resident loses their job and needs to relocate for new employment
• A family emergency requires them to move across the country to care for an aging parent
• A health issue forces them to downsize or move closer to medical care
• An unexpected divorce or relationship change makes the current housing situation untenable

These are legitimate life circumstances that no one could have predicted or prevented. Even a resident who passed thorough screening with excellent credit, stable employment, and great rental history can face these challenges.

But while these situations may be understandable, they still create a significant problem for you, the property owner.

The Real Costs of a Broken Lease

When a resident breaks their lease early, you face several financial hits:

1. Lost Rent Every day the property sits vacant is lost income. Even if you find a new resident quickly, you’re likely looking at a minimum of 15-30 days of vacancy. At $3,000/month rent, that’s $1,500-$3,000 in lost income.

2. Turnover Costs The property needs to be cleaned, repaired (if needed), and prepared for the next resident. Even if the departing tenant left the property in decent condition, there are costs involved in getting it rent-ready again. Typical turnover costs in the Inland Empire run $500-$5,000 depending on property condition.

3. Placement Fees If you’re working with a typical property management company, they’ll charge a leasing or placement fee to find and screen a new resident. In our market, these fees typically range from 50%-100% of one month’s rent – that’s $1,500-$3,000+ for most properties.

Total potential loss: $10,000 or more.

Now, the repair and maintenance expenses would occur eventually anyway – just probably farther in the future at the end of a normal lease term. But the vacancy loss and leasing fees? Why should you have to pay again when you didn’t cause the problem?

This is why we created our Lease Guarantee.

How Our Lease Guarantee Works

Here’s the simple promise: If a resident WE placed breaks their INITIAL lease, we go back to work to find, screen, approve, and move in a new resident with NO additional placement fee to you.

To clarify:

Who’s Covered: This guarantee applies to residents that WE placed. If you had an existing resident when you hired us, this guarantee wouldn’t apply to that resident. But any resident we screen, approve, and place is covered.

Time Period: The guarantee covers the INITIAL lease term only. If we placed a resident five years ago who’s now on their fourth renewal and they break that lease, there would be a standard placement fee. But if we place someone on a 12-month lease and they break it in month 8, you’re covered.

Legal Exemptions: There are a few legally protected situations where this guarantee doesn’t apply:

• Active-duty military members who receive official change-of-station orders (protected by federal Servicemembers Civil Relief Act)
• Victims of domestic violence who cannot safely remain in the property (protected by California law)
• Properties that become legally uninhabitable due to landlord-caused issues or deferred maintenance

These situations are rare, and in most cases, you’d want to release these residents from their obligations anyway for ethical and legal reasons.

What You’re Protected From: You won’t pay a duplicate placement fee. We’ll absorb that cost and find you a new qualified resident at no additional charge.

What You’re Still Responsible For: Standard turnover costs (cleaning, repairs) and any vacancy loss not covered by the departing tenant’s obligations. But when a resident breaks their lease, there’s usually a penalty structure built into the lease agreement that helps protect you financially.

Depending on the circumstances and the terms of the lease, the departing resident may owe:

• Remaining rent through a notice period
• Early termination penalties
• Costs to re-rent the property
• Forfeiture of all or part of their security deposit

In some cases, you could continue receiving rent payments from the departing resident while we market the property. Your actual out-of-pocket costs may be minimal.

But regardless of how the lease-break penalty plays out, our Lease Guarantee removes a significant cost – the duplicate placement fee. You won’t be paying thousands for a problem you didn’t cause.

Why This Guarantee Benefits Everyone

Over the years of offering this guarantee, I’ve seen it deliver value in three distinct ways:

1. Aligned Interests We want residents who stay long-term just as much as you do. Long-term tenancies are better for everyone:

• The property owner gets stable income and fewer turnovers
• The resident gets a stable home and community
• We get to manage a property without constant disruption

This shared interest means we work hard to place the best, most stable residents possible in your properties. We’re not just checking boxes on an application – we’re looking for people who have the financial stability, lifestyle fit, and commitment level to honor their lease.

2. Financial Protection Losing a good resident unexpectedly is frustrating enough. The disruption to your cash flow, the uncertainty about how long it will take to re-rent, the hassle of another turnover – these are all stressful even before you consider the costs.

You shouldn’t have to absorb additional unnecessary fees on top of that disruption. Our Lease Guarantee keeps your costs down during an already challenging situation.

3. Demonstrated Commitment Our guarantee shows that our word matters. We keep our promises. We do what we say we’re going to do.

When we guarantee our placement results, we put real pressure on ourselves to perform well. If we DON’T perform – if we consistently place residents who break their leases – we lose money, we lose clients, and our business suffers.

That accountability makes us better at what we do.

Core Values in Action

Three of our five core values apply directly to this guarantee:

Own the Outcome – We take responsibility for our work and the results we deliver. Resident placement is one of the most critical services we provide. This guarantee shows we’re confident enough in our screening process to back it up financially.

Put the Client First – We look after our clients’ financial well-being, not just our own bottom line. We could easily collect another placement fee when a resident breaks their lease – most property management companies do. But that’s not what’s best for you, so we don’t do it.

Treat People Right – This value applies to both our relationship with you AND with the departing resident. We work with residents during their difficult time professionally and honestly, helping them understand their financial responsibilities while also assisting them with their transition. We don’t rebuke or berate people who are already going through a challenging life situation.

Real-World Impact

After years of offering the Lease Guarantee, I can tell you with confidence: It has strengthened our client relationships and improved our screening processes.

Our clients trust that we’re working in their best interests because we’ve demonstrated it with financial accountability. And guaranteeing our results makes us better at what we do – we’re constantly refining our screening process, our resident education, and our lease structures to minimize the risk of early terminations.

For us and our clients, that’s a Win-Win.

Our Comprehensive Risk-Reduction Approach

This is Part 7 of our 8-part Service Guarantee Series. Over the past several weeks, we’ve detailed our comprehensive approach to reducing risk and providing peace of mind for rental property investors:

Part 1: Why Service Guarantees Matter – Our philosophy of risk mitigation and professional accountability

Part 2: Communication Guarantee – How guaranteed response times reduce stress and improve decision-making

Part 3: Satisfaction Guarantee – Why we’ve offered penalty-free cancellation for 20 years

Part 4: Performance Guarantee – How we align our financial interests with yours

Part 5: No-Hidden-Fees Guarantee – Complete pricing transparency in all relationships

Part 6: No-Upfront-Charges Guarantee – Risk-free trial without upfront investment

Part 7: Lease Guarantee (You Are Here!) – Protection from duplicate fees when residents break leases

Part 8: No-Eviction Guarantee (coming next) – How we handle the worst-case scenario

Together, these eight guarantees create a comprehensive risk-mitigation system designed to address the fears that keep property owners from hiring professional management, or staying trapped them with poor-performing managers they’re afraid to leave.

Questions About Our Lease Guarantee?

If you have questions about our Lease Guarantee or any of our other service guarantees, I’m happy to discuss how they work in real-world situations.

Call me directly at 951-314-5402. You can also find more information about all our service guarantees at dreambigpm.com.