Burnsville, MN · Member since 2013 · 13 posts · 0 votes
Hello,
This is out first time renting out our home and after our tenants moved in they never put the utilities in their own name and I am still being charged for them. I plan on sending out a certified letter today stating they need to be put in their own name. I guess I am asking if anyone has gone through this how they handled it or for any suggestions on what to put in the letter. Im thinking it is possible grounds for eviction.
Rental Property Investor · Denver, CO · Member since 2013 · 4k+ posts · 2k+ votes
12y
Melissa quick question. Is it in the lease that the utilities must be in the tenants name? If not, then you are likely to be on the hook for them. Without language in the lease requiring them to pay utilities, you can't just assume that it's their responsibility. What about property taxes? If it's not in the lease that the tenant pays them they you pay them. Same idea with utilities.
Now assuming that you do have it in the lease from here on.
Second question - have you contacted the tenants and reminded them they need to put the utilities in their name? If not, do so before you do the certified letter route. In all the chaos of moving they may have forgotten and just need a reminder. You can follow up with the utility company in a day or so to see that they follow through with it. If not then see below.
Also my utility companies allow me to put the utilities in their name since I have the SSN and a lease. You might be able to just call up the utility company and move the utilities into the tenant's name again.
Now with regards to your notice. Your state probably has forms that are used to communicate to the tenant that they have violated terms of the lease. You need to use those forms so that you can move on to eviction if they fail to pay and are required to pay. Also does your lease have a clause stating the funds received are applied to outstanding items before rent. If that is the case then you apply the money you received to the power bills and they now owe rent. You can file for eviction for non-payment of rent. In many locations it's much easier to get an eviction for non-payment than for some other lease violation.
Philadelphia, PA · Member since 2013 · 8 posts · 1 vote
12y
@Melissa Lenhardt I think the certified letter is a good idea, but tell them when you are going to turn off the utilities. Say they'll be turned off by November 18th and they need to put it in their own name. Further explain that the utilities that have already been used will be added to their rent. The sooner you do this, the better it'll be for both of you.
Is it clearly spelled out in your rental agreement that the tenant is responsible for utilities? Some states may have laws against turning off heat in the winter - it may be worth checking with your attorney.
Fourplex Investor · College Station, TX · Member since 2013 · 57 posts · 3 votes
12y
@Melissa Lenhardt I think it will be grounds for eviction if your contract mentions it.
I used a Texas standard contract and in the contract it does mentioned that "if you turn utilities off of if you do not connect them; then there is a violation of the contract" which a violation gives the landlord grounds for eviction.
Why didn't you turn the utilities off? I turn my off before every tenant comes in to give them time to turn them on in their names. The utility company here does not allow two different names on the accounts so I make sure my tenants do not have any trouble to turn utilities on.
Rental Property Investor · Denver, CO · Member since 2013 · 4k+ posts · 2k+ votes
12y
Melissa quick question. Is it in the lease that the utilities must be in the tenants name? If not, then you are likely to be on the hook for them. Without language in the lease requiring them to pay utilities, you can't just assume that it's their responsibility. What about property taxes? If it's not in the lease that the tenant pays them they you pay them. Same idea with utilities.
Now assuming that you do have it in the lease from here on.
Second question - have you contacted the tenants and reminded them they need to put the utilities in their name? If not, do so before you do the certified letter route. In all the chaos of moving they may have forgotten and just need a reminder. You can follow up with the utility company in a day or so to see that they follow through with it. If not then see below.
Also my utility companies allow me to put the utilities in their name since I have the SSN and a lease. You might be able to just call up the utility company and move the utilities into the tenant's name again.
Now with regards to your notice. Your state probably has forms that are used to communicate to the tenant that they have violated terms of the lease. You need to use those forms so that you can move on to eviction if they fail to pay and are required to pay. Also does your lease have a clause stating the funds received are applied to outstanding items before rent. If that is the case then you apply the money you received to the power bills and they now owe rent. You can file for eviction for non-payment of rent. In many locations it's much easier to get an eviction for non-payment than for some other lease violation.
Rental Property Investor · Denver, CO · Member since 2013 · 4k+ posts · 2k+ votes
12y
@Terence Nicol please do not ever turn off utilities after a tenant has moved in or threaten to do so. I know of no jurisdiction that this is not considered a self help eviction which will land you in serious trouble with the court. Usually treble damages.
Burnsville, MN · Member since 2013 · 13 posts · 0 votes
12y
Yes it is in the lease they are to pay all electric and gas bills and I did take them out of my name when we moved. Due to the fact that I am listed as a landlord and it is still our property because they were never put in their name they still billed me. My husband is calling them to clarify the situation and what we expect and I will follow up with a certified letter of expectation.
I do want to give them the benefit of the doubt but I don't want it to go on too long and so forth. Thanks for all your great suggestions William! I will see if I can have them put in their name and will check my state forms.
Investor · Louisville, KY · Member since 2013 · 139 posts · 43 votes
12y
I agree, don't shut them off. I had this happen lat month. We discussed utilities at move in, and I gave them a sheet of how to get them set up. I was a bit surprised when I got the bill a few weeks later. I called immediately and explained that utilities are not included in the rent and that they needed to be changed over immediately. They put the utilities in their name that day. The following day I called again to verify that they had done so, and emailed a copy of the bill and instructed them to include payment along with their rent, and they did. I also called the utility to verify that they were switched out of my name. I think more communication is always better than less, most people are rational and want to do the right thing. I always try to maintain a positive upbeat attitude with tenants, but never become friends with tenants.
Investor · Union, NJ · Member since 2011 · 838 posts · 295 votes
12y
MElissa,
There has been great advice given here... One questsion I have and I apologize if I didn't see it mentioned already, how long have they been living there with the utilities in your name?
Personally, If it has only been a month I would just call them and mention it to them. PErhaps it was an oversight. You can even ask them to pay the utilties if they have occupied the property for the billing period of the latest bill. If it was truly an oversight they should gladly oblige.
Burnsville, MN · Member since 2013 · 13 posts · 0 votes
12y
That is part of my frustration @ Chris it has been 2 1/2 months. They moved in august 18th and I am just now finding out that I am still being billed for it. Stupid on my part I overlooked the billing that I was stilling being charged for it. I will call and remind them and then follow up with a certified letter explaining what needs to take place and if not what action will be taken. I just called too see if I could put it electric in their name and I couldn't. I did however get gas put in their name as of today. To get my back payments back I will have to add it to their rent.
Investor · North Wales, PA · Member since 2013 · 116 posts · 44 votes
12y
I'm not sure why exactly, but you seen quite keen on this certified letter. I'm relatively newmto this as well, on my second set of tenants, but people give pretty good advice here.
I find that talking to your tenants, as regular people, is often the best way to resolve things. As you indicated that you just noticed this yourself, it seems that you have not notified them in any way yet. If they refuse your offer to have a discussion as reasonable people, then move onto the next step.
Real Estate Agent · Virginia Beach, VA · Member since 2012 · 2k+ posts · 1k+ votes
12y
My PM in Raleigh makes them show printouts of confirmation of new service for gas, electric and water before they hand over the keys. Might be a good idea for you in the future.
Investor · Riverside, CA · Member since 2011 · 2k+ posts · 3k+ votes
12y
If they signed a lease agreeing to transfer the utilities into their name and didn't, I'd just call and shut them off. It has happened to me several times. There is no law against it as far as I am aware of. It is illegal if you are supplying utilities and you shut them off in retaliation or in an attempt to get your tenants out.
You probably want to notify your tenants, but I would do it with a simple phone call. The letter I would send would have copies of the bills and a notice that they need to remit payment ASAP. If they don't pay, I'd deduct it from their security deposit later.
Rental Property Investor · Denver, CO · Member since 2013 · 4k+ posts · 2k+ votes
12y
@Aaron Mazzrillo , It doesn't mater what your lease says if you have the utilities shut off after the tenant has lived there you will loose if you end up going to court. It's like this
Tenant to Judge: I didn't pay rent because the LL shut of the utilities.
Judge to You: Self help eviction - treble damages.
You are now paying the tenant to live in your property.
Sure you have gotten away with it and will likely get away with it in the future but that doesn't make it legal.
Investor · San Jose, CA · Member since 2012 · 2k+ posts · 3k+ votes
12y
Hi Melissa,
I may be wrong, but I think you're blowing things out of proportion here. I'd just call them up and say I just realized that they haven't transferred the utilities under their name and please do so ASAP. I will also show them the utility hills and ask them to reimburse you. That's all.
This has happened to me before, and I never have any problems collecting the back utility bills. The tenants would apologize and happy to reimburse me. It's a team effort. No need to get frustrated. Some municipalities send out the bill every 2 months instead of monthly.
Investor · San Jose, CA · Member since 2012 · 2k+ posts · 3k+ votes
12y
If you turned off the utilities, you will lose when you go to court. Don't do it. Again, the tenants are your business partner, but you will get all the benefits at the end. Handle it professionally and not let your emotion gets in the way.
@Aaron Mazzrillo , It doesn't mater what your lease says if you have the utilities shut off after the tenant has lived there you will loose if you end up going to court. It's like this
Burnsville, MN · Member since 2013 · 13 posts · 0 votes
12y
Just so that everyone understands Im not blowing this out of proportion. I am calling them first! and Im not shutting of their utilities. I will follow up with it in writing IF.... they don't change them. They have had 2 1/2 -3 months to have done it and have not. Its not simply they haven't changed them yet. I am going to give them the benefit of the doubt.
Thanks again William for your advice and well put help.
Investor · Narragansett, RI · Member since 2013 · 8k+ posts · 4k+ votes
12y
We always ask the utility be shut off on x date and tell the tenants that. If the tenants don't put it in their name by that date the utility company sometimes does leave the electric on but they have never billed me (but no one has gone 2 months without paying).
As a tenant I once gave a date to shut off the utilities and the utility company did not shut them off as my landlord said to leave them on. I told the utility company I ordered a shut off , bill the landlord if you left it on. I guess they did because I never heard from them.
I am not sure if you said discontinue service how they can keep billing you (except water which is not allowed to be in the tenants name here). Could be some state law. Good luck.
Investor · Riverside, CA · Member since 2011 · 2k+ posts · 3k+ votes
12y
I emailed my legal dept and here is their response:
"If you did not turn the utilities off prior to the tenant moving in then you cannot turn them off now as you’ve now made yourself responsible for them and if you decide to turn them off, the tenant can sue you for $200 per day and they will win. All utilities need to be shut off prior to handing the tenant keys so something like this doesn’t happen. If you can convince them to change it into their name, great, but if not, you legally cannot turn them off. Also, you cannot evict for the tenant not turning the utilities into their name regardless of what it states on your lease as you would easily lose the case simply for not doing your own diligence and turning them off prior."
Thanks @Willaim Schaffer for making me look further into this. I kinda knew it was not the right thing to do, but I kinda didn't care I guess you could say. Now that I know the consequences, I certainly care a whole lot more!
@William Schaffer <- @mention Doesn't appear to be working.. :(
Rental Property Investor · Milwaukee, WI · Member since 2013 · 6k+ posts · 4k+ votes
12y
I only had one time where a tenant moved in and forgot to transfer them into her name right away. She explained that she just got caught up in the move and forgot. She contacted the utility company and since the meters are electronic, they can back-date them to any date they want and so she had them back date to when she moved in. I got an adjusted bill and she gets the bills going forward. Problem solved.
If it's a written lease signed by the tenant and landlord and clearly states that the tenant needs to pay the utilities but they won't, well then you probably have a case for small claims and the judge will look at the contract and see that the tenant is responsible. Unless there is a law stating that you are now responsible for the utilities then this should be an easy case as the contract is the binding.
NEVER mess with a tenants essential services. That's a rule of thumb.
Rental Property Investor · Denver, CO · Member since 2013 · 4k+ posts · 2k+ votes
12y
Easy solutions regarding tenants not paying utilities. Make sure your lease has that any money received from tenant first goes toward other items owed landlord by tenant. So if they owe you $50 for utilities then rent becomes short $50 which is universally the thing you can evict for.
If you require them to put the utilities in their name make sure there is language stating that if they fail to do so and you pay the utilities then the tenant owes you the money you paid. You then revert back to the previous clause where the money coming in goes to outstanding items first and rent last.
If you ever get into this situation, be sure to clearly communicate your accounting to the tenant to let them know they are behind in rent and where the money went. Incidentally if you take this route then you are also due late fees if allowed by the lease and/or your state laws.
Investor · Middletown, NJ · Member since 2008 · 2k+ posts · 1k+ votes
12y
Exactly as @Bill S. said. My lease states that utilities are to be put in the tenant's name prior to move-in. If any utility that they are responsible for is not paid, it is considered "additional rent", and a Pay or Quit notice can be served. When a tenant moves out, I call the utility company and have the utility billed in my name until a new tenant has a scheduled move-in date. I then call the utility and let them know that as of that date, the bill will no longer go to me.
If the tenant doesn't transfer the service to their name, I don't get billed (unless it's water/sewer in NJ) and the utility company will notify the tenant occupant of imminent shut off. Or so they're supposed to...it's never gotten to that point.