ANSWERS: 2
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The question isn't really whether or not your landlord can break the lease, it's whether or not YOU can. Your lease is with your landlord, not anyone else. If you are able to buy the house, I would suggest that you speak to your landlord as soon as it seems very likely that the deal will go through. Explain that this was an unforeseen circumstance, and offer to help find tenants. Even if he holds you to the lease, you're going to still buy the house, right? I hope so. Good luck!
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Yes, however, he will be liable for whatever penalties he agreed to... if you found your landlord a new tenant, the landlord might go easy on you.
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