Tenant claims he's paying the rent to someone else
Provo, UT · Member since 2016 · 55 posts · 15 votes
Tenant claims he's paying the rent to someone else
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Mackaylee BeachPro Member
Real Estate Agent · Kansas City, MO · Member since 2020 · 1k+ posts · 492 votesDo you actually have a lease in place? If no lease, I would definitely consider a squatter. I would begin eviction as soon as possible - especially if rent is not being collected.
13 Replies
- Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes3y
@Stewart VanValkenburg Yeah, from day one I would had to file eviction papers…only way to ferret out the truth.
- Property Manager · Denver, CO · Member since 2021 · 667 posts · 587 votes3y
This sounds very complex and since it's in NY, I would find a good attorney and start the process the right way.
- 3yMackaylee BeachPro MemberReal Estate Agent · Kansas City, MO · Member since 2020 · 1k+ posts · 492 votes
Do you actually have a lease in place? If no lease, I would definitely consider a squatter. I would begin eviction as soon as possible - especially if rent is not being collected.
- Honolulu, HI · Member since 2008 · 3k+ posts · 2k+ votes3yAloha,
Maybe I am not understanding your post correctly...you have one Tenant in a duplex that has been "paying rent" to an unknown person and living there for over a year, and you have not received a dime? And now, that unknown person is trying to get Tenant #2 to start paying him too?
WTH are you waiting for? Give CLEAR notice to Tenant #2 that rent is to be paid only to the place and person/entity that you direct in writing. Do you have a copy of #2 Rental Agreement? If so, reference the Document Name (lease, Rental Agreement, whatever it states at the top); date it was signed; the parties to that document; and reference the paragraph that informs who/where to pay. If Tenant #2 is skeptical, locate your Property Tax website or other State Authority to print out a current report on the ownership of that unit (which shows you/your entity). Further inform this Tenant that you will not be waiting a year to file eviction on him if he fails to make payment as detailed. Also, collect any information he can provide as to contact info, name, vehicle description, whatever regarding the wannabe landlord, so you can make a criminal complaint with regard to Tenant #1.
Fire your current PM if he has not collected a dime from #1 and done nothing to remedy the situation. This sounds like pure fraud of some type, would not surprise me if Tenant 1 and the fake LL are in cahoots.
Alternatively, sell that dog fast...you do not belong in the business based on this scenario if I have understood you correctly. - Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes3y
Quote from @Stewart VanValkenburg:
So I have a duplex in Binghamton NY. Switched out property managers last year because the one I had had sticky fingers. Found there was someone living in a unit who said it wasn't the old PM who put him there or the new one, but someone else. Claimed to be paying rent to this other person. Fast forward a year and he's still there. My new PM wanted to wait till his lease was up (Aug 31st) instead of going to court because court is a multimonth process there and it was trickier than usual with his claim. He's still there and trying to collect rent from the other tenant in the duplex. Have you ever had this happen? Anything in particular I can try besides sic a lawyer on him?
As best as I understand this, you became aware last year that someone was living in 50% of the building and not paying rent, and nothing's been done so far? Holy crap. Yes, you need to start eviction proceedings ASAP. If this guy is telling the truth someone needs to be getting arrested for fraud, and in any case you are losing a boatload of money.
Skyline Properties - Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes3y
Quote from @Stewart VanValkenburg:
I can't believe you would accept this from your property manager. They told you to continue allowing someone to live in a unit for an entire year, for free, because eviction takes multiple months? Did you do the math on that? You doubled, tripled, or quadrupled your losses just so the PM didn't have to do their job!
Start the eviction immediately. Today! I also recommend you start looking for a professional PM instead of a glorified rent collector. Heck, your current PM doesn't even qualify as a rent collector!
Remember: cheaper doesn't mean you'll make more money.
Start by going to www.narpm.org to search their directory of managers. These are professionals with additional training and a stricter code of ethics. It's no guarantee but it's a good place to start. You can also search Google and read reviews. Regardless of how you find them, try to interview at least three managers.
1. Ask how many units they manage and how much experience they have. If it's a larger organization, feel free to inquire about their staff qualifications.
2. Review their management agreement. Make sure it explicitly explains the process for termination if you are unhappy with their services, but especially if they violate the terms of your agreement.
3. Understand the fees involved and calculate the total cost for an entire year of management so you can compare the different managers. It may sound nice to pay a 6% management fee but the extra fees can add up to be more than the other company that charges 10% with no additional fees. Fees should be clearly stated in writing, easy to understand, and justifiable. Common fees will include a set-up fee, leasing fee for each turnover or a lease renewal fee, marking up maintenance, retaining late fees, and more. If you ask the manager to justify a fee and he starts hemming and hawing, move on or require them to remove the fee. Don't be afraid to negotiate, particularly if you have a lot of rentals.
4. Review their lease agreement and addenda. Think of all the things that could go wrong and see if the lease addresses them: unauthorized pets or tenants, early termination, security deposit, lease violations, late rent, eviction, lawn maintenance, parking, etc.
5. Don't just read the lease! Ask the manager to explain their process for dealing with maintenance, late rent, evictions, turnover, etc. If they are professional, they can explain this quickly and easily. If they are VERY professional, they will have their processes in writing as verification that policies are enforced equally and fairly by their entire staff.
6. Ask to speak with some of their current owners and current/former tenants. You can also check their reviews online at Google, Facebook, or Yelp. Just remember: most negative reviews are written by problematic tenants. The fact that a tenant is complaining online might be an indication the property manager dealt with them properly so be sure to ask the manager for their side of the story.
7. Look at their marketing strategy. Are they doing everything they can to expose properties to the widest possible market? Are their listings detailed with good quality photos? Can they prove how long it takes to rent a vacant property?
This isn't inclusive but should give you a good start. If you have specific questions about property management, I'll be happy to help!
The DIY Landlord Book4.7247 Reviews - Rental Property Investor · Member since 2020 · 1k+ posts · 1k+ votes3y
I have a strong suspicion that you are going to court either way. It seems naive that someone willing to commit this kind of fraud is going to just up and leave when the lease is over. They are playing you for a fool and are going to continue to do so after the lease is over. If you haven't taken action up to this point why would they believe you when the lease is over. It is posts like this that make me laugh when certain individuals response to everyone's question is that you should just give up and get a property manager, obviously this is not going to solve all your problems. In fact picking the wrong one can be worse than messing up yourself in many instances.
- 3yMichael SmytheBusiness MemberReal Estate Agent · Metro Detroit · Member since 2023 · 4k+ posts · 3k+ votes
You have either an incompetent or lazy PMC.
Fire them ASAP and hire a new one!
Encourage you to learn from the mistakes of others - by reading posts here on BiggerPockets about owners not having their expectations met by their current Property Management Company.
To avoid going through the same poor experience, keep reading.
Even if someone give you a referral, don’t make the mistake of assuming that PMC will meet your expectations, just because they met the expectations of the referral source.
We also can’t believe how many owners hire the first PMC they speak with!
Then they complain their expectations aren’t being met!
In our experience, the #1 mistake owners make when selecting a Property Management Company (PMC) is ASSUMING instead of CONFIRMING.
It's often a case of not doing enough research, as they don't know what they don't know!
Owners mistakenly ASSUME all PMCs offer the exact SAME SERVICES and PERFORM those services EXACTLY THE SAME WAY, so price is the only differentiator – and they often select the first PMC they call!
So, the first question they usually ask a PMC is about fees - instead of asking about services and HOW those services are executed.
EXAMPLE: PMC states they will handle tenant screening – what does that specifically mean? What documents do they require, what credit scores do they allow, how do they verify previous rental history, etc.? You’d be shocked by how little actual screening many PMC’s do!
This also leads owners to ASSUME simpler is better when it comes to management contracts.
The reality is the opposite - if it's not in writing then the PMC doesn't have to provide the service or can charge extra for it!
We have a 14-page management contract that we've added our real experiences to over the years, with the intent of protecting both us AND the landlord. Beyond the Monthly Management, Placement & Maintenance fees, all other fees in our contract are IF EVENT -> THEN fees.
We don’t know any PMCs to recommend in the area mentioned, but since selecting the wrong PMC is usually more harmful than selecting a bad tenant, you might want to read our series about “How to Screen a PMC Better than a Tenant”:
We recommend you get management contracts from several PMCs and compare the services they cover and, more importantly, what they each DO NOT cover.
EDUCATE YOURSELF - yes, it will take time, but will lead to a selection that better meets your expectations & avoids potentially costly surprises!
P.S. If you just hire the cheapest or first PMC you speak with and it turns into a bad experience, please don’t assume ALL PMC’s are bad and start trashing PMC’s in general. Take ownership of your mistake and learn to do the proper due diligence recommended above😊
Logical Property Management4.9454 Reviews - 3yTheresa HarrisPro MemberMember since 2019 · 15k+ posts · 11k+ votes
How did he get the keys to the unit and who is he paying rent to? As soon as the PM found out, he should have told the person to stop paying the other person the rent and pay him if the PM wasn't willing to do an eviction.
Did I read your post right that the 'tenant' is trying to collect rent from the other tenant living in the other half of the duplex? If so, I'd say screw the tenant who is paying someone else, and serve him with an eviction. You could also get the police involved as what he's doing (trying to collect rent from a unit he doesn't own/manage) is illegal.
- Investor · CO · Member since 2016 · 757 posts · 1k+ votes3y
Sorry to hear you are going through this.
I agree with the other folk here.
1. Get the legal process process started as soon as possible
2. Fire your PM.
3. Pray the tenant move out at the end of the lease to by pass the legal process.
I would not depend on #3. What they sign a new lease with the fraudulent landlord?
- 3yStephanie JacobsonBusiness MemberReal Estate Agent · Ithaca, NY · Member since 2016 · 429 posts · 324 votes
Call Rachel Miller at Aswad & Ingraham, she'll send you in the right direction.
- Provo, UT · Member since 2016 · 55 posts · 15 votes3y
Update, the tenant claimed to have signed and payed a whole year upfront to this other person, again. The PM told him she called up the city and they have no such person in their records. Tenant said he won't pay until someone takes him to court. I told her to jump on that. For a clarification, the PM suggested letting him stay until his 'contract' was up at the beginning of summer, so 3 months away from it being done. An eviction takes a few months, then you have to hold onto their 'stuff' for 30 days, so it made sense timeframe wise.
@Nathan Gesner I did check narpm.org but they don't have any members in that area.
@Theresa Harris I assume he got in when I was firing the last property manager and hiring this one.
@Mackaylee Beach Unfortunately NY treats squatters pretty much the same as tenants. If they stay at least 30 days they legally count as tenants for some reason. I've tried to get the cops involved in kicking out squatters before that 30 day time limit but they say it's not their job, all the squatter had to say was that she was renting there and the cops took her word for it.
- 3yTheresa HarrisPro MemberMember since 2019 · 15k+ posts · 11k+ votes
Tell the PM to start the eviction process and if they are trying to get the other tenant to pay them rent, call the police and get him arrested for fraud. hopefully the other tenant has half a brain in their head and knows you pay the PM.
I also doubt the one tenant has any proof that they paid a year in advance to a random person.
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