Good tenant but lost their job 4 months ago

Member since 2018 · 20 posts · 6 votes

My tenant is about to hit the end of my 1 year lease. Great tenant that has paid on time until she lost her job 6 months into the lease.

I gave her 2 months to recover from her financial loss. She was able to get help from the rental assistant program that paid 6 months of her rent.

However now that the lease is about to end, the tenant is saying she will apply for unemployment and for another 6 months of rental assistance.

I am concerned about this because what took her so long to apply for unemployment and will unemployment pay her enough to cover the rent.

Her current rent is 1050 but market rent went up to about $1200.

Should I renew her lease or should I give her the 60 day notice to vacate, fix the unit up and rent it at market rate.

Thank you for all your responses.

1 Reply

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Scott M.

Real Estate Broker · Rochester Hills, MI · Member since 2009 · 2k+ posts · 2k+ votes

60 day notice to vacate, fix the unit up and rent it at market rate.

100% No question about it given the facts as you laid them out.

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Scott M.
Real Estate Broker · Rochester Hills, MI · Member since 2009 · 2k+ posts · 2k+ votes
4y
60 day notice to vacate, fix the unit up and rent it at market rate.
100% No question about it given the facts as you laid them out.
23 Reply
Account Closed
Investor · Scottsdale Austin Tuktoyaktuk · Member since 2021 · 4k+ posts · 4k+ votes
4y
Originally posted by @Joel Betances:
My tenant is about to hit the end of my 1 year lease. Great tenant that has paid on time until she lost her job 6 months into the lease.
I gave her 2 months to recover from her financial loss. She was able to get help from the rental assistant program that paid 6 months of her rent.
However now that the lease is about to end, the tenant is saying she will apply for unemployment and for another 6 months of rental assistance.
I am concerned about this because what took her so long to apply for unemployment and will unemployment pay her enough to cover the rent.
Her current rent is 1050 but market rent went up to about $1200.
Should I renew her lease or should I give her the 60 day notice to vacate, fix the unit up and rent it at market rate.
Thank you for all your responses.

If she can't find a job in 30 days in this market, she isn't looking.
Oh, I get it, she can't find a job she "Likes". Well, it's time to set her back into reality. Give her notice to move and she will find a job really fast, guaranteed.
16 Reply
Joel Betances
OP
Member since 2018 · 20 posts · 6 votes
4y
@Scott M.
Thank you Scott. Will do this immediately
0 Reply
Joel Betances
OP
Member since 2018 · 20 posts · 6 votes
4y
@Mike Hern
Love your response. I will give her 60 day notice
1 Reply
Tim Miller
Rental Property Investor · Laurel, MD · Member since 2016 · 383 posts · 382 votes
4y
@Joel Betances 6 months and no job? Now will apply for unemployment? H E DOUBLE HOCKEY STICKS NO! If you are feeling generous, go ahead and give 60 day notice to vacate but if the law says 30 days. I'd give that and move her out ASAP!
4 Reply
R.J. Lange
Kennewick, WA · Member since 2021 · 30 posts · 34 votes
4y
Agree with @Scott M.
0 Reply
Matthew Paul
Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
4y
Give her 60 day notice and see how fast she gets a job
2 Reply
Debbie C.
Member since 2019 · 118 posts · 74 votes
4y
@Joel Betances
Another thing to consider when looking for a new tenant is do you want to offer a 1 year lease or something less. Check out the laws for your state/area.
I always started with a 1 year lease prior to all this covid and the issues that came along with it. Now I am only offering a 6month lease, then month to month after that. I am sure many landlord's out there are only doing mtm. Just something to think about.
And I agree with the comments above. Give her notice and move on.
1 Reply
Nathan GesnerBusiness Member
Moderator
Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
4y
Quote from @Joel Betances:

My tenant is about to hit the end of my 1 year lease. Great tenant that has paid on time until she lost her job 6 months into the lease.
I gave her 2 months to recover from her financial loss. She was able to get help from the rental assistant program that paid 6 months of her rent.
However now that the lease is about to end, the tenant is saying she will apply for unemployment and for another 6 months of rental assistance.
I am concerned about this because what took her so long to apply for unemployment and will unemployment pay her enough to cover the rent.
Her current rent is 1050 but market rent went up to about $1200.
Should I renew her lease or should I give her the 60 day notice to vacate, fix the unit up and rent it at market rate.
Thank you for all your responses.

Drop her like a hot potato. She sat on her keester for six months with free rent and didn't apply for unemployment or find a new job? In this economy? My 15-year-old can earn enough at McDonalds to afford almost any apartment in my town, where too many people under 30 sit around complaining how expensive it is to rent. There's just no excuse.
She's bad news and you'll dodge a bullet by getting rid of her.
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4 Reply
Scott M.
Real Estate Broker · Rochester Hills, MI · Member since 2009 · 2k+ posts · 2k+ votes
4y
I know you loved @Account Closed comment but I would respectfully disagree. Unless you don't have the capital to do a turn right now there is no way I would accept this tenant back if she got a new job because of your notice.
You are far better off to start over fresh.
5 Reply
Joe SplitrockPro Member
Moderator
Rental Property Investor · Sioux Falls, SD · Member since 2015 · 9k+ posts · 18k+ votes
4y
@Joel Betances you have to apply for unemployment when you lose your job and you have to provide proof you are looking for a new job. The rules vary by state, but the maximum period you qualify is 26 weeks (6 months) and that is with regular recertification. She may be eligible for rent assistance, but given the facts, I would not renew.
2 Reply
Colleen F.Pro Member
Investor · Narragansett, RI · Member since 2013 · 8k+ posts · 4k+ votes
4y
@Joel Betances give her 60 days notice. While she may have had difficulty finding a comparable job in her field it will give her the incentive to relocate or take something else. And if she doesn't it isn't your issue. People hit rough spots but that is when you go to friends and family for help, not your landlord.

If you do decide to keep her (that is your choice) I advise a M2M lease in case in hindsight you think I should have let her go.
2 Reply
Mary M.
Rental Property Investor · Portland OR · Member since 2018 · 2k+ posts · 3k+ votes
4y
be absolutely sure you read the local laws as it pertains to covid. You may or may not be in an area where if she applies for assistance she will need a grace period of x days (here is 60-90) ....
0 Reply
Adam Martin
Rental Property Investor · Member since 2020 · 1k+ posts · 1k+ votes
4y
Just out of curiosity the title states good tenant lost job 4 months ago but I’m struggling to see what makes her qualify as good in your book. You forgave 2 months rent for a tenant who had been with you less than a year who is getting free rent from grants. In a time when employers are begging for help she hasn’t got a job in 4 months and didn’t even have the motivation to apply for unemployment for 4 months. I’m really not trying to be mean but am curious outside of cooperating with the rental relief process what has gone well that would make you want her to stay.
6 Reply
Theresa HarrisPro Member
Member since 2019 · 15k+ posts · 11k+ votes
4y
What is preventing her from getting a new job? She's had time to find a new job (sometimes easier said that done I know). I'd tell her you aren't renewing the lease. There is a limit for how long she can get unemployment.
1 Reply
Gary L Wallman
Rental Property Investor · Beavercreek OH · Member since 2018 · 422 posts · 970 votes
4y
Originally posted by @Joel Betances:
My tenant is about to hit the end of my 1 year lease. Great tenant that has paid on time until she lost her job 6 months into the lease.
I gave her 2 months to recover from her financial loss. She was able to get help from the rental assistant program that paid 6 months of her rent.
However now that the lease is about to end, the tenant is saying she will apply for unemployment and for another 6 months of rental assistance.
I am concerned about this because what took her so long to apply for unemployment and will unemployment pay her enough to cover the rent.
Her current rent is 1050 but market rent went up to about $1200.
Should I renew her lease or should I give her the 60 day notice to vacate, fix the unit up and rent it at market rate.
Thank you for all your responses.

Joel,
Great tenant? NOT! 6 whole months of paying on time. You can't be serious. Drop her like a hot potato.
I just don't understand how anyone can provide hundreds of thousands of dollars in capital to provide a home for someone else and think this is a great tenant. Sorry.
Respectfully,
Gary
2 Reply
Quincy Lockett
South Holland, IL · Member since 2017 · 376 posts · 432 votes
4y
@Joel Betances
As uncomfortable it may be, you HAVE to cut the cord and let her go. You’ll feel MUCH better about your decision 3 month from now when you replace her with a tenant just as reliable and happy to pay the $1,200/month
0 Reply
Michael Noto
Real Estate Agent · Southington, CT · Member since 2008 · 5k+ posts · 3k+ votes
4y
You are in the business of collecting rent and you know the tenant does not have a means to pay. This is a tough situation for your tenant, but it will probably be better for them to get into a place they can afford also. The issue you are likely to have is the tenant will have no where to go so the sooner you give them notice the better.
1 Reply
Dave PoeppelmeierBusiness Member
Realtor · Maumee, OH · Member since 2015 · 491 posts · 722 votes
4y
@Joel Betances unfortunately she's not a "good tenant" anymore. In this rental market, there are lots of people with steady income looking for a good place to live. I agree with everyone else: notice to vacate, clean up the unit, rent at your higher rate. I would even say not to take her back even if she finds a job. People don't change, and you'll be back in this same situation in 6 months. Yes, it's a calloused view, but we've all been there and you have to look out for yourself.
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1 Reply
So Da
Member since 2020 · 28 posts · 10 votes
4y
I agree with giving her a notice to vacate, but what would be the grounds of the notice? What is the reason to vacate if you received rent from her each month.
Asking in the hopes of learning the nuance here.
0 Reply
Todor Ialamov
Real Estate Agent · Burlington MA · Member since 2018 · 114 posts · 142 votes
4y
Everyone on Earth is hiring right now. If she can't a job in today's economy means she is not looking. Uber would give her a car, she could start immediately and make more than enough to pay her rent in a weekend!
1 Reply
Curtis Mears
Property Manager · Raleigh, NC · Member since 2014 · 729 posts · 596 votes
4y
@Joel Betances
Interesting because with almost every business desperate for employees, getting a job should not take more than a day. Sounds like she is playing you
0 Reply
Curtis Mears
Property Manager · Raleigh, NC · Member since 2014 · 729 posts · 596 votes
4y
@Joel Betances
Interesting because with almost every business desperate for employees, getting a job should not take more than a day. Sounds like she is playing you
0 Reply
David Dachtera
Rental Property Investor · Rockford, IL · Member since 2014 · 4k+ posts · 2k+ votes
4y
All of you chiding the tenant for delaying applying for unemployment likely do not understand the process.

First off, in that situation, the tenant must manage her financial resources carefully. Deferred income can keep one alive and in one's home beyond the current resources.

There is also severance pay to consider. In some states, one cannot apply for unemployment until AFTER the end of the severance period.
There could also the "base period" which may determine the amount of benefit you get. It could be the 18 to 24 months prior to the year you became unemployed, or some such. Delaying filing can shift that base period calculation in your favor.

Another consideration is the new discussion about stimulus and additional unemployment supplement.

Timing is everything.

Also, while job openings are plentiful, jobs that pay enough to support you with decent benefits and working conditions are still rather a dear commodity. Corporate America and many small businesses haven't "got it" yet.

My $0.02 ...
0 Reply
Soraya Bloom
Specialist · Monterey, CA · Member since 2021 · 7 posts · 1 vote
4y
My concern with your tenant is the procrastination to fix her financial situation. Unemployment only pays about 60% of earnings. Is she depending on rental assistance to take care of rent and unemployment to cover the rest of her bills? Will she save money along the way? There are too many questions and frankly, it's not your job to handhold along the way. I would address my concerns and ask if she has a plan but let her know that the 60 day notice will have to be implemented.
Rental properties are an investment. It's your income and your priority is to generate on the property. Business is business right? As humans, empathy can sometimes hinder your focus but in the end, your success is based on your hustle.

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