Hi BPer's help me out please. We closed on a property July 1. A 'nice' fella came through July 10th and "needed to move in right away, that day." I told him we have repairs lined up and if he'd be patient with me and also passed our application process he could have the place. So the next morning, a Friday, my on-site representative went through the lease and got everything signed between us and him.
Part of the repairs included new carpet for this small place, 496 s.f. and he knew that. It was written into the lease but with no time frame. We had the carpet on hold, the pad purchased and the guy lined up to start the work Monday afternoon with a target of being done Tuesday/Wednesday. The tenant lost his patience Monday afternoon because the installer hadn't started yet (I had been on the phone with the tenant every day tracking the process and keeping in the loop) and now he wants out and he wants his money back.
He signed a 6 month lease and gave first months rent and a security deposit. There are no terms in the lease for backing out with a refund. As a matter of fact if there is a breach in the lease the full amount comes due. What should I do?
give him his money back, there will be many other tenants when the property is ready.
If it takes two days to install carpet in a 496 s.f, you need to get someone else to install the carpet. Give the tenant his money back and move on because you did not deliver, and you should never rent a unit until it is ready to rent.
It's been 4 days and he's freaking out? Has he moved in yet? Regardless, we usually set it up where they sign a deposit agreement that holds the unit for 2 weeks. It is non-refundable, so if they back out, they lose their deposit. Then when they sign the lease, we have a 3 month lease breaking fee (which, if we re-rent the property, we refund whatever difference there is since you can't lease one unit twice). In this case, I would specify these things in your lease and use more date-specific language going forward. I would probably charge him the full deposit and refund the rest if he hasn't move in. If he has, I would probably charge more.
Definitely give him back his money and be glad to see him go. Any tenant that "needed to move in right away, that day" is trouble. There's a reason they are desperate. Don't be a desperate landlord.
I'm not sure how your on-site rep was able to verify everything on a rental application the same day it was submitted, especially a Friday. It can take days to reach previous landlords, verify employment and speak to managers, although the credit/background check is fairly quick. But still....take the time to do thorough screening. And do a thorough walk-through and document anything he may have done while he's been there.
The tenant agreed to take the unit right away and was going to install the carpet himself. Then he called on Saturday to say he picked out the carpet but he changed his mind about installing it. So I scrambled Sunday morning to line someone up to install this on Monday. The carpet that the tenant has on hold at the carpet store that he selected can't deliver it until Thursday. That carpet store is 1.5 hours away where his buddy gave him a deal. So I told the tenant to pick out something locally so it could get done sooner and he said no.
Learning a huge lesson here!!
I did the background check-got his application Thursday. I was able to talk to his references both Thursday and Friday.
You are right-I do feel like a desperate Landlord Aly NA Ugh everyone has a sob story and I am a sucker.
Don't feel bad, it's happened to all of us! I've been a sucker too and have learned the hard way.
I've been down this road before, scrambling to do whatever the tenant wanted, just to get them in and have the place rented. Usually by then, the vacancy had gone on for a month or two and I was certainly feeling desperate. Not nearly so much anymore, and not enough to ever let a tenant do anything like install carpeting or paint. Our leases specifically prohibit them from doing anything like that - although we recently had a tenant that did far more than that.
Anyway...their desperation is their problem. They can crash on a friend's couch or in their car until a unit is ready to our standards. We do take a deposit to hold the unit while we finish painting or whatever, but they know approximately how long that will take. If they can't wait - NEXT!
As others have pointed out, give him his money back, get the keys back and change the locks (just a hint on this last one).
I've had more than my share of folks who contact me with the "must move in now" business. This usually means they've been evicted (or are about to be ) and are/will be parked on moms couch. Sometimes they tell you this with the hope you'll skip your screening process.
One of the things that's rather scary with your tenant is that if he was so desperate to move in you would think he'd be more patient on this carpet business. Sounds like something else is going on here. That's why my suggestion to change the locks once he's out of there.
Yeah, he's sketchy. I would give him his money and be glad to see him go. Some people just need to feel they are controlling the situation, in one way or another, no matter what. He sounds like one of those -- they don't make good tenants ;)
@Jean Bolger that's exactly right. He doesn't want some young woman calling the shots. He was thinking he could move back from FL and live with his aunt (they are both about 65) and I think she threw him out. I am following all the advice. Some of his stuff is still in the apartment so he'll get his money back when he gets it out of there and gives the keys back.
Haha! THAT guy! I think I've met him...
(a couple times, unfortunately)
I just did the same thing. The tenant wanted in right away, said they would do the painting to help me out and speed up the process. Needless to say, it was a poor paint job and the tenant couldn't come up with first months rent. I did an eviction 17 days into the first month. Some lessons you just have to learn the hard way. Be thankful you got this lesson out of the way.
WHOA! 17 days in!? That's rough. Must be one bad tenant.
newbie mistake. did you call previous landlords? hope you dont allow yourself to get burned again.
The above advice is great and I hope this guy goes away quickly for you. Definitely never rent a place until it's ready. Don't agree to let tenants do work in your units either because that can cause problems if they decide you somehow owe them money for all their work painting/carpeting/whatever the place.
Repeating also about a person who needs to move asap...especially "that day". Oh, and don't give in on an applicant who doesn't make the 3X the (pretax) amount of rent per month. I recently had an applicant who really wanted the place, but they didn't provide one bit of proof of income. When I asked for it, they said they'd get it over to me, but just never seemed to be able to follow through. It was as if I was asking for the world. I declined their application. The desperation to rent from me was also a red flag.
Good luck! Take some great pictures of the place finished, and watch the interest to rent come in. :-)
Thanks to everyone! I want to give an update-I did call previous landlord (it was the manager of the mobile home place where he rented and she said he was wonderful and always very timely with his rent (his credit score was VERY high). This was his previous address.
I have asked him to write a statement explaining that he wants out of the lease (up to this point he has only told me verbally.) I told him I need this to track the history of the situation and he told me more than a week ago he would mail that to me notarized (I didn't ask for the notary but he volunteered that.) I have not received this, I still have his money and he still has a few odds and ends in the house. I will be calling him soon to check on the status of his written document. I do not have a new tenant but have had the carpet replaced and am going to start showing it.
Did he at least give you some kind of written notice that he was vacating? Don't wait on him to initiate it. At this point, give him a standard form to sign. Did he give you a clear date that he would be out of the unit? Date should be on the form. Since he still has personal belongings there, he is still occupying the unit. He paid first month rent (July), so he has rights to tenancy at least to the end of the month and you have rights to that rent money.
As for the security deposit.... after you account for chargeable cleaning, damages, unpaid utilities, etc, then return the remainder. Do a full accounting of any security deposit withheld and mail it according to the requirements of your local landlord-tenant law.
Looking forward to hearing how quickly you rent up the unit with more promising tenants!
He has access to it until August 12th based on what he's paid, yes. We have already switched the utilities back into my name. I will fill out a form and send it to him since I have not heard from him and his stuff is there.
If he is renting the unit until August 12 and has not yet returned possession of the unit to you, why did you change the utilities back into your name already? Also, since he is still technically occupying the unit, I hope you are giving proper "Notice to Enter" in compliance with the landlord-tenant laws in your jurisdiction before you enter the unit to do maintenance or to show.
At the end of tenancy, when a tenant returns the keys to us, we ask them to sign a "Return of Possession" form so there will be no question that they are returning the unit to us. If the tenant takes off and hasn't given us written notice that they are vacating, leaves possessions behind, and doesn't return the keys, we must follow the procedures for abandonment before we can regain possession. Your landlord-tenant law will govern what you need to do.
@Marcia Maynard technically the utilities never changed. He said he switched the power to his name but when i called about it the power company said he didn't switch them. Everything is still in my name.
I will use the techniques you have outlined here. We aren't accessing the unit now since the work is done and I did give him proper notice, I called him and let him know when we'll be there and when we'll be done. I know his things are in there because I can see them through the window. I have been contacted by his attorney and they are claiming that he was not able to take possession of the property and they want a full refund. Meanwhile his things are there and we can't do anything with the unit until this is all resolved.
I highly recommend you out a buy out clause in your lease. I had this happen. An out of state applicant wanted the house because he got a job. They put everything down, signed the lease and than 5 weeks later 2 days before move in. They got a better job offer and move somewhere else. Well I told him the buy out clause was invoked. Thank goodness for that! Otherwise we would have been screed.
I think a buy out clause should work both ways not one sided.
Not many tenants will go the attorney route so quickly. Those that do are usually up to no good. How well do you know the landlord-tenant law for your jurisdiction? Is a phone call really enough to enter? Documented? I thought written notice 24 hr in advance is the norm for Ohio. Do you have a local mentor that can guide you through this?
Once attorneys get involved, it is usually the attorneys that fair the best. His attorney may be legit, or a friend writing a letter to you on letterhead that looks like an attorney. Either way, until the tenant has removed his belongings and returned the keys to you, he is still occupying your property. Let them know you are prepared to settle once the tenant has returned possession of the property back to you. I would be prepared to return all monies except rent for the days he occupied the property and for any damages that he may have caused to your property. If you want to negotiate beyond that, it is up to you.
Join the Largest Real Estate Investing Community
Basic membership is free, forever.