George Mason University Antonin Scalia Law School

Early Lease Termination: Security Deposits, Service Members, and Landlords

Written By Spring 2024 M-VETS Student Advisor Dan Perszyk.

Moving is often a part of life for service members. In fact, due to deployment or a Permanent Change of Station (PCS), many active service members need to find new housing every few years.[1] Annually, around 400,000 service members undertake a PCS for their next two (to four) year term.[2]

In addition to a new job, new commute, and new surroundings, service members new to an area must locate acceptable housing for the next few years. And then, if the timeline for their next PCS or deployment doesn’t align with their lease term, the service member will need to update their landlord regarding their early lease termination.

In a perfect scenario, the service member provides an update to their landlord who then confirms the new lease end date. The landlord conducts the move-out inspection, notifies the tenant of any issues with the property that warrant a deduction from the security deposit, and then returns the remainder of (or the entire) security deposit.[3]

Unfortunately, this “perfect scenario” doesn’t always come to fruition. From the landlord’s perspective, an early termination moves their timeline up; requires an early inspection, tenant interviews, and property showings; and may require additional property listing costs. Whether unintentionally or otherwise, the landlord may retain more of the security deposit than the terms of the lease agreement would appear to permit.[4]

Under these circumstances, the tenant has options (discussed in more detail below). They can:

  • communicate with the landlord and request their security deposit be returned,
  • work with an attorney to draft a demand letter,
  • file a complaint for a return of their security deposit, or
  • decide to do nothing.

Option One has the benefit of being relatively low-cost, financially (and, potentially, emotionally). The tenant may be able to convince the landlord that returning the security deposit (or an agreed-upon portion) is the right, fair, and legal thing to do. This may also allow the landlord to explain the reasoning behind retaining the security deposit so that both parties leave with a better understanding of the property’s condition at move-out. This scenario may be ineffective, however, if the tenant’s frustrations or communication skills are not sufficient to appeal to the landlord’s reasonability. It may also be that the landlord is simply not willing to return the security deposit on any terms. Finally, this interchange may inflame both party’s frustrations, and result in the landlord invoicing (or even filing a complaint against) the tenant for claimed damage done beyond what the security deposit would cover.

Option Two may be useful to show that the tenant feels they have a valid claim, and that they feel the situation is serious. This may recommend to the landlord that they should likewise consider whether they made a fair decision in withholding the security deposit. However, attorney’s services are generally not free, a demand letter is not service of a complaint,[5] and a landlord may treat that demand letter as nothing more than an empty pressure tactic. Finally, the landlord may be even less likely to engage with an attorney than they would with the tenant directly (see Option One).

Option Three has the benefit of using the legal system to resolve the party’s disagreement. Because the amount at issue relates to security deposits (which are limited to two month’s periodic rent by Virginia statute),[6] landlord tenant disputes are generally heard by a general district court judge (in Virginia, at least),[7] who will take evidence from both sides and make a ruling based on their findings.[8] This scenario has the benefit of vindicating one of the parties and gives the result an air of authority and finality that a simple handshake or email agreement might not.

Option Three also brings challenges. The legal process takes time, and the service member may have moved far enough away that they would have to buy a plane ticket and rent a hotel room just to defend their claim in the local court (such costs cannot be passed off to a landlord, even were the landlord found to be liable for the complete return of the security deposit).[9] Once in court, the tenant may find that they do not have all the evidence necessary to prove their claim – even if that evidence did, at one time, exist.[10] In these situations, a judge may not have enough evidence to find for the tenant; they may then simply split the difference of the disputed amount between the two parties (if they award the tenant anything at all). Finally, landlord tenant disputes of this nature involve deposit money to which both parties may feel they have a legitimate claim. As a result, tensions and frustrations can run high, and a tenant under these circumstances may not appear as sympathetic a party as they actually are. This provides an additional challenge for a factfinder, who may be looking at a sympathetic, calm landlord compared to a frustrated, tense, or nervous tenant unfamiliar with legal proceedings and uncertain how much help they are likely to receive in court.

In Option Four, the tenant can choose to do nothing. The benefits of this approach are that there is no investment in litigation – no gathering of evidence, no documenting communication, no reaching out to attorneys or legal aid funds. There is also less chance that the landlord will respond with a legal complaint of their own. The downside of this approach is that it will result in the loss of a deposit (or portion thereof), and there is no guarantee that the landlord will not still file a complaint for additional damages to the property.

So, what is a service member—or, really, any tenant—to do?

While no approach is perfect, there are a few guidelines that service members can follow to ensure as smooth a tenancy transition as possible – no matter which option they pursue:

  • Read the lease agreement. Inclusion of a service member transition section is a plus (while Virginia has its own statute to protect service members who terminate early due to PCS,[11] inclusion of such a section in the agreement at least provides that the landlord has considered this possibility). Make sure that the tenant’s—and landlord’s—duties are clearly described and seem fair.
  • Communicate with the landlord. If the service member knows before signing the lease that a PCS is possible, inform the landlord and assess whether they seem amenable to this. Discuss the terms of the lease, and make sure all parties agree on the difference between negligent damage to property and normal wear and tear. Where possible, document these communications. After a verbal conversation, follow up with an email that summarizes the main points, and ask for confirmation of receipt and agreement.
  • Keep documentation. Make sure all documents related to the lease—lease agreement, addendums, renewals, communications about repairs or other matters, invoices, etc—are kept in clear, legible formats. If a landlord provides only partial documentation, request fully-executed, complete versions of the documents.
  • Read reviews. See what other tenants have said about the landlord or rental property management. While older reviews may be outdated (particularly for locations with a front office that experiences some amount of staff turnover), reviews can provide information on how responsive the landlord is, how fair they seem, and how communicative they can be when dealing with tenants. Be sure to read critically – a five-star review may greatly overstate the landlord’s positives, and a one-star review might just as easily have come from a disgruntled tenant who requested return of the full security deposit after demolishing their apartment far in excess of the security deposit.
  • Be an excellent tenant. Follow the terms of the lease. Communicate issues with the landlord. Be upfront. Check in with the landlord before making changes, even small ones. Again: follow the terms of the lease!
  • Be respectful. Landlords are people too. They will have a much easier time returning a security deposit if they had a good relationship with a pleasant tenant who did what they said they would do and took good care of the property. There is no guarantee, of course, but being respectful goes a long way.
  • Follow the early termination agreement in the contract; if the contract does not have such agreement, follow Va. Code § 55.1-1235: Early termination of rental agreement by military personnel. When ending a rental lease early, be ready to provide written notice of intent to end the lease along with a copy of the relevant military orders. To be eligible under Virginia law for a non-penalized early termination, the relocation must be more than 35 miles from the rental property, the service member must be released from active duty, or the service member must be ordered to report to government-supplied quarters.[12] The service member must provide their military orders to the landlord at least 30 days before early lease termination, but there is no harm in providing this documentation as soon as possible.[13] Confirm with the landlord that they have received the documentation.
  • Attend the walkthrough. The walkthrough is the landlord’s review of the property after the tenant’s lease ends. They will check to make sure that the property is in order, note any issues, and itemize those issues accordingly.[14] Under Virginia law, there is no requirement that the tenant be present for the walkthrough,[15] but this is something that the tenant can contract into the lease agreement and, barring a written agreement, make this request to the landlord prior to move-out.
  • Be prepared for the possibility that the security deposit may not be returned. It may be hard to admit, but there are times where, either because of valid property damage or because the landlord never intended to return the security deposit, the deposit will simply not be returned. It’s never happy news when this is the case but becomes much more difficult to handle when unexpected. It is always better to prepare for the worst and be happily surprised by a different outcome than it is to expect that everything will work out perfectly and find that that is not the case.

In all, even the perfect tenant may find themselves in a difficult situation after transferring before the original lease ends. Landlord tenant disputes may not always allow for perfect solutions, but there is a lot a service member tenant can do to increase their chances of a fair outcome after an early lease termination.

[1] Supporting your service member before a military move, Military One Source, (March 14, 2024).

[2] PCS: The Basics About Permanent Change of Station, Military One Source, (April 18, 2023).

[3] Va. Code § 55.1-1226.

[4] See, e.g., Genesis Props. V. Wright, 59 Va. Cir. 256, 3 (Cir. Ct. City of Richmond, July 12, 2002)(landlord withheld security deposit after tenants terminated lease with sufficient notice; landlord was required to pay back security deposit less property damage).

[5] Va. Code § 8.01-296 (service of a complaint is the process of legally notifying someone that they are a party in a legal dispute).

[6] Va. Code § 55.1-1226(A).

[7] Va. Code § 16.1-77 (general district courts hear all cases where the amount in controversy is less than $4,500. Cases with disputed amounts between $4,501 and $25,000 can be brought before a general district or circuit court judge).

[8] Va. Code § 16.1-122.5 (the judge has “discretion to admit all evidence which may be of probative value” even if formal rules of evidence are not followed).

[9] See Va. Code § 55.1-1226 (note: under section (f), tenants may be able to recover damages and attorney’s fees, if the court finds that the landlord willfully failed to comply with a valid request for security deposit return).

[10] For example: evidence of repairs, evidence of a successful walkthrough, lack of evidence of itemization, evidence of an updated lease after renewal.

[11] Va. Code § 55.1-1235.

[12] Id.

[13] Id.

[14] Va. Code § 55.1-1214 (the landlord must complete their walkthrough within 5 days of occupancy end).

[15] See Virginia Code Chapter 12: Virginia Residential Landlord and Tenant Act.