The formula to calculate the tenant buyout amount is:
\[ TB = (\text{MR} \times \text{M}) + (\text{MR} \times \text{M} \times \text{P}) \]
Where:
A tenant buyout is a legal agreement where a landlord offers a tenant a certain amount of money to voluntarily vacate a rented property, typically before the lease term ends. This usually happens when the landlord wants to renovate or sell the property or rent it out at a higher rate. The amount offered in a buyout can vary greatly and is often negotiable. It may cover moving expenses, a new security deposit, or even several months’ rent at a new location. The tenant is not obligated to accept the buyout offer and can choose to stay in the property until the lease term ends. If the tenant accepts the buyout, they will typically sign a legal document stating they will not sue the landlord for wrongful eviction.
Example 1:
Step 1: Calculate the base amount:
\[ \text{Base Amount} = 1200 \times 6 = 7200 \]
Step 2: Calculate the penalty amount:
\[ \text{Penalty Amount} = 1200 \times 6 \times 0.10 = 720 \]
Step 3: Add the base amount and penalty amount:
\[ \text{TB} = 7200 + 720 = 7920 \]
Example 2:
Step 1: Calculate the base amount:
\[ \text{Base Amount} = 1500 \times 8 = 12000 \]
Step 2: Calculate the penalty amount:
\[ \text{Penalty Amount} = 1500 \times 8 \times 0.15 = 1800 \]
Step 3: Add the base amount and penalty amount:
\[ \text{TB} = 12000 + 1800 = 13800 \]