Registered: 1490987909 Posts: 13
Reply with quote #1
My husband and I fell into the roles of landlord when he ended up laid off from his work due to company downsizing in a very small town where we own our home. We searched for jobs for him to no avail. I was already commuting 1.5 hours each way to my job. We decided to move. Long story short: we both found employment and housing in the new location. Since it's such a small town, real estate sells VERY slowly. Not uncommon for houses to stay on the market 6-12 months. We put the house up for sale on Zillow, were contacted by someone to rent it, so we sat down, worked out a rental agreement without an attorney, typed it up and we all signed it.
Risky but we had to move to start the new jobs, we knew the person (small town) so we didn't think anything would go wrong. While it wasn't ideal, I did listen to my gut by documenting lease terms (one year lease, outlined rent and due date...) He said he wanted a year to fix his credit so he could buy the house. So we put a negotiated purchase price of the house in the lease and said we would renegotiate after the one year mark should he not buy it. Worst. Tenant. Ever. Every single rent payment has been late. At one point he was three months behind! That was when I retained an attorney. He got paid back up, but again all subsequent months have been late. He almost fell two months behind a few times but managed to catch back up. We are now on the cusp of the one year mark and we know that he will not be able to purchase the house. I refuse to have a repeat of this year where I'm constantly chasing him down for rent payments. So we visited the house and put it on the market. We found out all kinds of things. He made unauthorized "repairs"/modifications to the house such as taking down the banister to the bottom half of the stairwell and moved the washer and dryer upstairs into the room that we used as an office/husband's family growing up used it as a third bedroom. So now it's a laundry room and thus the house can't be considered 3 beds anymore. There is an unauthorized person living in the house (a neighbor took a picture for me) and they are living like pigs. Stuff everywhere...not so much filth but just plain clutter. Everywhere. When my husband and I lived there, we had a lot of stuff but they make it look like we were minimalists. To our surprise and delight the realtor secured a showing of the property this past week. At first the tenant disconnected his telephone to avoid phone calls from the lawyer and realtor. He then reconnected it and said he will allow this one showing, then no more, and he is getting a lawyer. He made the showing uncomfortable by badmouthing me (he thinks I'm the evil one 'cause I'm the mouthpiece as husband is laid back and doesn't address issues) saying there is an "ongoing legal battle". Yeah it's called you don't pay your rent! They had the nerve to say to my husband and I when we were visiting "I thought we were buying the house" to which I said "ok then make an offer to the realtor". They know what they have to do. They just aren't in a financial place to do it. I would be willing to continue to rent to them except that we had to fight so often to get paid the rent and I refuse to do it again for another year. Needless to say, my lawyer sent them a letter stating they need to be out by May 1 (end of lease) unless they buy the house. (We had to put that clause in there due to the terms of the original lease). We anticipate they won't move out on time and we will need to move forward into a holdover proceeding. I'm concerned cause rent is due tomorrow for April (the terms of the lease are that it must be postmarked by the first of the month, so I know I won't receive it till next week if at all). I anticipate he won't pay and am prepared to just pay the mortgage without the rental income. However, I'm also concerned that he will go down kicking and screaming and damage the house on his way out. I understand we can sue him for damages (we didn't charge a security deposit because since we knew him, we trusted that things wouldn't turn out the way they did). I know the lawyer will take care of all the filing etc. I'm just wondering if there's any advice out there. The more I think about this, the more I consider situations that he might try to pull. Ex. the W/D are ours with the house... most apartments out there are W/D hookups so now I'm concerned he will take ours from the house whenever he does move. If you can think of anything else that should be on my radar, it would be helpful. I actually hope that he DOES get an attorney as the attorney would advise him to NOT damage things or take things that belong to the house. We plan to go back up there if we need to show for court (the attorney will let us know if it needs to be just him or if we need to be there too), and then after he's out, to clean the place up, do any repairs and then get it ready for showing. The neighbor and I have been friends for years...she has my back and will let me know if anything suspicious goes on. Thanks everyone
Registered: 1490987909 Posts: 13
Reply with quote #2
What kills me about his rent being late is that HE was the one who chose the due date to begin with!! He picked the first of the month and has not stuck to it ever! I could sort of understand if rent was due on a date that was difficult for him and I'd be willing to change the due date but come on....
Registered: 1415137586 Posts: 314
Reply with quote #3
wish you luck.
you made major mistakes. never rent to friends. always get security deposit. as soon as they are 5 (3 in some states) give a 5 day pay or quit. if you do not receive payment, file eviction. sue for rent and damages including changes they made.
Registered: 1487987694 Posts: 54
Reply with quote #4
Agree with dishroger. Sorry for your misfortune but there was one more cardinal mistake. Always screen your tenants. It sounds like you didn't have many to choose from so it was tempting to take the first tenant who came along. But ask yourself if you would have been better off not renting at all instead of having the hassle and expense of a deadbeat tenant and major repairs.
Best of luck! __________________ Domenick | AccidentalRental - A profitable resource for new landlords
Registered: 1490987909 Posts: 13
Reply with quote #5
Here's what my lawyer recommends (who was referred to me by the state's Bar Association) considering he has already been served with papers saying he needs to either buy the house or vacate by May 1 (and we know he doesn't have the money for the downpayment nor the credit to obtain a mortgage but that language has to be in there so that we aren't breaking the terms of our lease), the lawyer advises we wait till May to proceed. Yes we are aware that we are unlikely to receive April rent. However. If we don't receive the rent by next week (he mails us checks) and we served him with a Pay or Quit, we could drag him to court, but the court would allow him time to pay, and allow him to stay, which could go past May 1. If we wait until May 1, we present to the judge the paper that he has already been served, we simply state that we do not wish to renew the lease due to every single rent payment being late, evidenced by all the records we have from the year up to and including April. The judge will have no choice but to rule in our favor. Lastly, the house is not damaged at this point. But if he damages it on his way out, yes we will have to sue for damages, but we will cross that bridge when we get there. He really likes the house, he wants to buy it. He just doesn't have the means to do so right now. I understand that, but I simply refuse for him to take me for a financial ride for another year. We readily admit we made all the mistakes you stated. We were in a hurry to get a renter in. And I just plain didn't know how to run a background check on someone. Now I do. The end goal is that once he is out, we're just plain going to sell the house to a qualified buyer through a realtor.