How to tell tenant they have to leave

Question

I am pretty new to RE investing and I am in the process of buying a little rental. There is a tenant in the rental who has lived there for 13 years but is only paying $400 month but there is no lease in place.

The owner has told me that they have never had a problem with the tenant but the owner feels the tenant is vindictive and will trash the place if the tenant finds out they have to move.

According to the owner the tenant cannot pay the $750 - $800 month rent that the house can rent for.
I am putting it under contract today and the tenant still has no clue the house is being sold. How do I go about telling the tenant and getting them to move out of the home they’ve lived in for 13 yrs hopefully without them trashing the place?

Thanks

Paul De Luca · Answer

@Jared Lundy

Is there a security deposit that will be transferred to you at closing? If so, you have some leverage there to ensure good behavior. If not, at some point the tenant is going to find out anyway so if possible you should schedule the inspection to occur when the tenant is there so you can talk to them to gauge their reaction. There's really nothing you can do to stop the tenant from trashing the place, that's out of your control. But I think you could at least soften the blow by telling them in person, giving them enough time to move, and maybe even offer to pay their moving costs to sweeten the deal if you feel it's necessary under the condition that they move out quickly and peacefully.

Jared Lundy · Answer

Thank you all for your responses.

It is a sticky situation.The renter was married to the grandchild of the owner for 11 years. 2 years ago the couple got divorced and the grandchild moved back in with the grandparent leaving the EX to pay rent on the house. The grandparent is 78 and doesn’t want to deal with the hassle of owning the house anymore and just wants to sell it. There is no lease in place but the EX has never failed to pay the $400 rent. Unfortunately the grandparent is losing $200 dollars a month on this property but the EX can’t afford to pay anymore than the $400 they are now.

But the EX still does not know the house is getting sold.

I have the joyous privilege of letting them know on Friday.. :)

Nathan Gesner · Answer

I suspect the Landlord is a typical amateur that failed to increase rent over the years. The longer he procrastinated, the harder it got. He was probably soft on everything, which is why the Tenant feels a sense of entitlement and ownership. The best solution is termination or eviction.

Eliott Elias · Answer

You give them more than enough time to find a new place, tell them you're willing to work with them on price in the interest of keeping them there. Treat this situation with care

Jaron Walling · Answer

@Jared Lundy The BP forums love updates like this! Good luck tomorrow.

13 years at 400 shekels, what a deal. They can afford something... just not your property.

Matthew Bowling · Answer

Ah, a complicated family situation! I would love to know what strategy you went with and how things went. 🙂

Matthew Bowling · Answer

I wonder, after 13 years, what the relationship is between the prior owner and the tenant is. My gut reaction is there needs to be some communication on all sides and estoppel completed with the tenant. This should cue the tenant in on the fact that things are changing in an official way. Is the tenant using any kind of assistance program? Or just getting away with paying below market value rent for 13 years?

Nathan Gesner · Answer

Andrew is correct. If there is no written lease, then the Tenant is considered a monthly renter. Because they've been there so long, they basically feel a sense of ownership and will likely fight you before leaving. Give them a 60-day notice (I believe your state only requires 30) and stick to your guns. Make it clear that you intend to evict through the court if they refuse to leave.

Here's the Missouri law: https://revisor.mo.gov/main/On...

Andrew Syrios · Answer

Most state law (from my understanding, check on this) act as if a tenant living in a property without a lease is de facto on a month-to-month lease. You could give them a 30-day (or 60-day, again, check your state laws) notice to vacate. Or you could simply raise their rent to market or close to market and make them tell you that they can't pay that much and either move out or perhaps they'll surprise you. The main thing is that you simply have to provide a written notice to vacate (or raise rent) in the proper amount of time according to your state laws. And also, in some states, you may have to pay the tenant some if you are giving a no-cause notice to vacate (Oregon, for example, requires this).

How to tell tenant they have to leave

How to tell tenant they have to leave

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