Posted by Teresa on January 27, 2012 under Eviction, Tenant Screening & Background Checks | 
Landlords, have you ever been the victim of a scam pulled off by a “professional tenant?” There are always a few lurking around in the shadows. We’ve heard a few stories lately about landlords who have suffered losses because they unknowingly fell victim to a pro.
Jeff is a new landlord who recently arranged with a couple to lease a rental unit he owns. They wrote a check for the first month’s rent and security deposit, which Jeff deposited into his account. A week later, they cancelled the lease because their employer was transferring them out of state. They asked for a refund. Jeff refunded the full amount, only to discover the original check was written on a non-existent account. It was counterfeit. The couple flew the coop and Jeff is out nearly $1300.
Banks don’t typically place holds on every check, so Jeff assumed it had cleared the bank with no problem.
One way to avoid this scam: Ask for the first month’s rent and security deposit in cash. That would have sent these two packing.
A better solution: Run a thorough tenant screening on every applicant. Check their credit history and criminal history. Call previous landlords and their current employer. Remember: scammers do their best work when no questions are asked.
Another story is about a famous scam where the tenant moves into an apartment and proceeds to trash the place. Or he just stops paying rent. He then waits for the eviction notice or sues the landlord for unsafe housing. He’s an expert at stretching out the judicial process though filing complaints, asking for judge recusals and causing postponements. In the meantime, landlords are racking up massive attorney’s fees, he’s living rent-free for months or years, and usually the court decides in his favor.
The only way to avoid this type of tenant scam is through tenant screening. One of the victims of this scammer admitted she didn’t check with any of his previous landlords before renting him an apartment.
Protect yourself, your business and your wallet by keeping your guard up, trusting no one you don’t know, and running a tenant background check on every prospective tenant.
Posted by Teresa on January 20, 2012 under Eviction, Landlord Tips |
Just because you don’t allow subleasing in your rental units doesn’t mean your tenants won’t do it—for a number of reasons. Perhaps they landed a new job in another city, or want to move in with a significant other, or maybe the apartment of their dreams became available. Tenants sometimes want to move before the lease is up; and rather than breaking the lease, finding someone to move in and take it over is a better option. For them.
When your tenants sublease without your knowledge, they have prevented you from conducting your usual due diligence on the people who are living on your property. You don’t know if they have a good rental or credit history. You have no way of knowing if they will take care of your property or be good neighbors. You don’t even know if they have jobs.
How do landlords find out about sublessors? Sometimes, the rent checks keep coming in from your tenant, because the sublease tenant is paying him or her. In other cases, the tenant will have the sublessor send their own checks directly to you. If you accept online payments, your tenant can simply give the sublessor the login and password, and they can pay out of their own account. Depending on the e-pay service, you may or may not have access to the name on the account.
When faced with an unauthorized sublease situation, the landlord holds all the cards. If your lease clearly states “no subleasing,” then you have recourse and can likely start eviction proceedings against the original tenant. And in most sublease agreements, the sublessor only has rights to occupy as long as the original tenant does.
Check with your attorney for all the details, but in most cases, landlords are never under any obligation to accept a sublessor if the lease prohibits it.
Posted by Teresa on January 9, 2012 under Eviction |
The last thing most landlords and tenants want to face is an eviction. For landlords, it’s messy, time-consuming and can be costly. For tenants, eviction can hurt their chances of renting another home, and could even leave them homeless.
There are ways to prevent a landlord-tenant relationship from ending in eviction, including proper tenant screening and conducting thorough tenant credit checks. But even good tenants lose jobs or have unexpected medical bills that can lead to difficulty paying rent. And when they stop paying rent, and won’t move on their own, eviction is the landlord’s legal recourse.
Depending on the state you live in, landlords are typically required to follow a strict protocol and process of notifying a tenant of impending eviction. Whether or not the tenant decides to fight the notice will determine whether the process goes quickly or drags out. The latter will add time and legal fees to the landlord’s case.
Other legal fees a landlord typically encounters in an eviction case include unlawful detainer for each adult in the rental unit, judgment, garnishment and service fees.
If you win your case, you then must remove the tenant from the property. In most states, you cannot just throw a tenant’s belongings out on the sidewalk. Typically, local law enforcement serves a notice and gives the tenant several days to leave. If they don’t, they will be removed by law enforcement.
In a few states, landlords are allowed to dispose of property a tenant leaves behind, but in most places, you’ll need to store the tenant’s property and follow proper notification procedures. In New York and New Jersey, for example, a landlord must store an evicted tenant’s belongings for 30 days, resulting in additional costs that are rarely recovered.
Expenses for cleaning and repairs add to the losses experienced by the landlord, since any security deposit paid by the tenant has likely been offset by loss of rent and legal fees.
By properly pre-screening tenants, offering an iron-clad lease to qualified applicants, and requiring strict adherence to rent due dates, landlords can establish a business model that lessens the chances of eviction—and saves them significant money and time.
Posted by Teresa on July 8, 2011 under Eviction, Lease and Rental Agreements, Rents and Deposits |
Whether you accept actual checks or electronic rent payments from your tenants, you may face a time when the tenant lacks funds to cover their payment—and your account is hit with a fee. Bounced checks cause loss of time and productivity, and landlords should not allow tenants to treat a returned rent check as anything less than the serious situation it is.
How do you handle bounced checks from your tenants?
Many landlords we know demand immediate full payment from the tenant for the rent, any applicable late fees, and a separate handling fee. The handling fee should cover both your bank’s returned check charge and your administrative time. If the full rent payment comes in after late fees have been assessed, be sure to add them to the total due.
Check your local and state laws regarding the amount of late and returned check fees you can charge. You may be able to charge a tenant penalties and interest; or you may be limited to a flat fee.
In addition, check local and state ordinances or with a landlord/tenant attorney regarding whether late and returned check fees must be spelled out in lease agreements. In some states and localities, fees must be clearly stated in the lease or the landlord may not charge them. In others, whether or not the lease includes the fees has no bearing.
Of course, including all applicable terms and fees in the lease is always a good idea. If your lease clearly spells out the consequences for bounced checks, including late fees, repayment requirements and time limits before eviction proceedings begin, your tenants should have no questions or surprises if and when they do write a rent check without having sufficient funds to cover it.
Protect your rental property and assets through tenant background checks. Proper tenant screening will ensure you are leasing to the best possible tenants.
Posted by Teresa on July 1, 2011 under Eviction, Lease and Rental Agreements |
While a lease agreement and landlord/tenant relationship is a strictly business arrangement, landlords sometimes have to deal with a tenant’s personal problems. Loss of a job, a need to break a lease and move to another city, and other life situations cross the line into a personal nature.
When tenants have protective orders against spouses, partners, or acquaintances, the landlord may not even know. However, when the other party violates the order and enters the rental property, problems can ensue all around.
One tenant in California was faced with eviction when her husband, from whom she was separated, threatened and stalked her at her apartment. Police were called and the tenant obtained a restraining order, but the property manager informed her she needed to move to avoid upsetting her fellow tenants.
In California, and most other states, a protective order protects tenants from repercussions such as eviction. Domestic violence that has been documented, as in this case, is not a reason for terminating a lease. But what if the tenant had allowed the stalking troublemaker onto the property? That’s another story. If the tenant is voluntarily subjecting other tenants and the property to possible harm by allowing a dangerous person onto the premises, eviction may be warranted.
Under Federal guidelines for Section 8 owners, landlords may not refuse to rent to an applicant solely because he or she is a victim of domestic violence, dating violence or stalking. Nor can the tenant be evicted, even if criminal acts (such as property damage) related to the domestic or dating violence or stalking, are caused by the tenant or a guest. There is an exception for cases in which there is an actual or imminent threat to other tenants or employees of the property if the tenant is not evicted.
Many states follow the federal guidelines, but if you need guidance on a situation, it’s best to check with a local law official or landlord/tenant attorney for advice.
It’s not easy to be privy to the personal problems of tenants, but at times a landlord can’t avoid it. It’s important to know what is and is not allowed when dealing with legalities such as restraining orders.
Legal disclaimer:
The contents of this article are intended for general information purposes only, and should not be relied upon as a substitute for obtaining legal advice applicable to your situation.
Posted by Teresa on May 31, 2011 under Eviction, Lease and Rental Agreements |
A young college student in Orlando moved out of a shared apartment before the lease was up. She left several pieces of valuable stereo equipment behind because she had no room for it in her new apartment. When the lease expired, her roommates moved out and left her property in the unit. The landlord then discovered the stereo equipment and that she’d painted her bedroom without permission.
The landlord informed the former tenant that she would not get her property back because she left it for so long and had painted her room. She offered to give the equipment back if the former tenant repainted the room to match the rest of the rental unit.
What was this landlord thinking?
In most jurisdictions, it is not legal to hold a tenant’s property in return for back rent or repairs. Nor is it the landlord’s responsibility to serve as a storage business for a former tenant’s property. This landlord could assume the property was abandoned. And that the tenant never read the lease clause where she agreed to ask for permission before painting. Still, holding property for ransom is not allowed.
Recently, a landlord in Minneapolis ranted about a tenant on his Facebook page. While he didn’t use any names, the description was clear enough—especially since the complaint was about hearing loud outbursts from a tenant’s developmentally challenged child. Not only was this heartless, it was not smart. The description narrowed the possibilities down to one.
What was this landlord thinking?
There is no substitute for discretion when you’re a landlord. Tenant issues should be confidential. And of course this landlord chose the wrong venue to discuss a tenant problem! Facebook posts have a way of going beyond your circle of friends. Plus, there’s no way to know who your friends’ friends are. In this case, the tenant caught wind of the rant and consulted a lawyer.
A landlord in California did not require a tenant to sign a new lease when her boyfriend and his toddler son moved into her apartment. She completed a new lease application and paid the fee, and assumed he had been added. However, she didn’t question that no new lease ever appeared for her to sign. Her rent checks were paid from a joint account under both her and her boyfriend’s names.
Eventually, the tenant discovered some peeling paint and, because the building was old, she tested it with a home lead paint detection kit. The results were positive. She filed a complaint with the landlord, who claimed she was not entitled to action because the boyfriend was not on the lease, and that he and the young child were squatters. The landlord threatened eviction. The tenant countered that she filled out an application and paid a fee, but had no copy of the application or of the $35 payment.
What was this landlord thinking?
Especially in California, every interaction with tenants should be in writing. In this case, the tenant probably has a case that she is being retaliated against because of the lead paint complaint. Both sides should have kept better records, but when it comes to eviction, a landlord should have documentation to back up every claim.
Legal disclaimer:
The contents of this article are intended for general information purposes only, and should not be relied upon as a substitute for obtaining legal advice applicable to your situation.
Posted by Teresa on May 28, 2011 under Eviction, Lease and Rental Agreements |
The Chicago Housing Authority is proposing a new rule that all adult tenants will need to be drug tested, and if they test positive, eviction proceedings will begin. While some private landlords would welcome the opportunity to test and then evict illegal drug users, more have to deal with tenants who smoke pot.
If you’ve noticed the distinctive smell of marijuana wafting out of your rental properties, how did you handle it? Some might think that smoking pot is as harmless as drinking a beer, but it’s still illegal. And if you’re ignoring a tenant’s drug use, you could be putting your business at risk.
Did you know that illegal drug use by tenants in your rental units could subject you to related property damage and personal injury suffered by other tenants or the public? Is it worth it to you?
Your best move as a landlord is to include a clause in your lease agreement that tenants agree to not violate any applicable laws, including the possession, use or sale of illegal drugs. If and when a tenant violates the lease by choosing to smoke marijuana, you have the grounds to evict.
Some landlords might think evicting over pot smoking is overkill. But allowing it can leave you open to litigation; the potential for harm is just too great. Besides, if you can smell marijuana, your other tenants probably can, too. What message are you sending if you fail to enforce the law, as well as the terms of your lease agreement?
Posted by Teresa on October 22, 2010 under Eviction, Landlord and Tenant FAQs |
Have you ever needed to break a lease with a tenant? We’ve heard from a few landlords who did just that, for different reasons:
Nancy rented out her home in Virginia when her husband was transferred to San Jose, CA. Six months later, he was laid off from his job and they returned to their hometown. Financial difficulties kept them from buying another house. Nancy and her husband wanted to move back into their home, but their tenant still had several months left on the one-year lease they signed when they moved.
Jerry rented an apartment above his business to the son of a friend. At first, everything worked out well—but soon, the tenant started paying rent a few days late, didn’t keep the apartment clean, and made way too much noise during Jerry’s business hours. He didn’t want to evict his friend’s son, but realized he made a mistake signing a one-year lease with him.
Steve’s situation was the opposite—he had a tenant who purchased a home and wanted to break the lease three months early. Steve’s first inclination was to say “no” and require the tenant to pay all three months’ rent. But the tenant had been great—never late with rent, quiet and no trouble—and he didn’t want to punish her. He was just concerned about renting the unit again.
Nancy and Jerry handled their problem with the same solution—they incentivized their tenants to voluntarily break the lease. Nancy calculated how much she and her husband were willing to offer before picking up the phone and calling the tenant. She explained the situation, offered to help the tenant find another place to live, and then asked if he would be willing to move out early. He accepted her offer of assistance and cash, and all was well.
Jerry also offered his friend’s son an incentive to move out. He had a talk with him, explained that it wasn’t working out but he didn’t want to evict him, and gave him the rest of the month (about 20 days) in free rent if the tenant agreed to move out. (And Jerry never rented to a friend or a friend’s kid again.)
Steve wanted to end his relationship with his tenant on a good note. He calculated the three months’ rent, inspected the unit and found that it was in good shape, and offered to let the tenant out of the lease in exchange for keeping the security deposit and one month’s rent. She quickly agreed, and recommended the apartment to a co-worker, who signed a lease with Steve soon after.
It is possible to break a lease with a tenant, whether it’s you or the tenant who wants it broken. Usually a little incentive does the trick—but it doesn’t hurt to be reasonable, polite and open-minded! The next time one of your tenants wants to break a lease, think about solutions rather than problems. You might be surprised to see that it can work out for both parties.
Posted by Teresa on October 20, 2010 under Eviction, Landlord Tips |
Eviction is typically the last step a landlord wants to take with a tenant. But it’s a reality in the real estate investment business. Most experienced landlords say the biggest mistake they make around eviction is waiting too long to start the proceedings.
So if you’re a landlord who is heading down the road toward evicting a tenant, here are 5 things you should know:
- Eviction comes after you legally terminate the tenancy. The requirements for giving a tenant notice that the tenancy has been terminated varies by state; every landlord should know the regulations in his or her state. Usually, a written notice is required, for example, a notice that the tenant pay the rent due by the 5th or the eviction lawsuit will proceed. (This is a “pay or quit” notice.)
- Every state has its own requirements for how eviction papers are written and served, too. Look up your state law on eviction; read it thoroughly. Ask an attorney to explain it if any statute or requirement is unclear.
- Many rental property owners advise new landlords to hire a landlord/tenant attorney to handle your first eviction to make sure that everything is done correctly. You don’t want your case thrown out of court because you’ve missed a legal notice or mixed up the number of days you are required to give the tenant to correct the problem.
- If your tenant fights the eviction, your case could take many weeks or months to go through the courts. Every notice, every complaint, and your history as a landlord could be scrutinized. It’s vitally important that you keep excellent records, treat every tenant equally and abide by your state and local laws throughout the entire eviction process.
- Depending on your state, you may have responsibilities after an evicted tenant moves out. In some states, the property owner is required to store a tenant’s left-behind property and notify them for a minimum time period before disposing of it.
It’s not easy to evict a tenant—for a reason. Forcing a person or family out of their home is not taken lightly. Be well-prepared if you must evict—and to reduce the probability of needing to evict, be sure to order a thorough tenant screening before you sign a lease with a potential tenant.
Legal disclaimer:
The contents of this article are intended for general information purposes only, and should not be relied upon as a substitute for obtaining legal advice applicable to your situation
Posted by Teresa on June 8, 2010 under Eviction, Tenant Screening & Background Checks |
Elaine is a responsible, no-nonsense landlord. Her leases are clear and thorough, and her tenants generally live by her rules. Every now and then, however, Elaine signs a lease with a tenant who unexpectedly starts causing trouble—despite her checking the tenant’s rental history, criminal background, and credit.
This time it’s a young woman who is simply too loud. She plays her TV at top volume, listens to bass-busting music late at night, and has way too many parties with her also-loud friends.
Elaine has reminded the young tenant about her rules on disturbing the peace. She’s asked her to discontinue the behavior. And now, other tenants are complaining. Elaine is ready to issue a Three-Day Notice to Quit. Is that her best option?
According to our sources, no. This non-conditional notice is generally used when whatever is happening to breach the lease cannot be corrected. Examples include illegal behavior like selling drugs, irreparable damage to the property, or subleasing the property without permission. The notice tells the tenant that if they are not out in three days, eviction proceedings will begin.
In this case, Elaine’s tenant could still correct her problem—just by quitting the loud parties and turning down her stereo equipment. Therefore, a Three-Day Notice to Perform Covenant or Quit is the better recourse. It must specifically state the behavior that breaches the lease so the tenant can correct it.
Then if the problem continues over the three-day period, Elaine can start eviction proceedings. But what if the tenant quiets down for three days, and turns up the volume again? Hopefully, the threat of eviction is enough to inspire behavior modification in this tenant. If not, another Three-Day Notice to Perform Covenant can be issued. After a few of these, it might be time for the Three Day Notice to Quit!
Legal disclaimer:
The contents of this article are intended for general information purposes only, and should not be relied upon as a substitute for obtaining legal advice applicable to your situation. Always consult your legal advisor for your particular situation.
Landlords, have you ever been the victim of a scam pulled off by a “professional tenant?” There are always a few lurking around in the shadows. We’ve heard a few stories lately about landlords who have suffered losses because they unknowingly fell victim to a pro.
