Tenant wants to back out from moving in

9 Replies

Their current landlord will allow them to stay after all due to his own housing situation. They gave me a 2K deposit a month ago. I have nothing in writing other than our emails about the lease and moving in, but he called me today he wants to back out and stay where he is at. He wants part of his deposit back if I find a new tenant in time. He did just say via text that he understands if I don't find a replacement in time, but wonders about if I do.

I told him no, and that it's unlikely that would happen as it took me 2 months to find him. Now I have less than a month to find a replacement for a class A property....

Thoughts?

ETA: I will go by the book for every little receipt with tenants from now on.

We had a potential tenant start waffling one whether they were going to move in or not.  We had them sign a binder agreement stating that if they did not sign the lease by a specified date we keep the deposit.  Going forward we will be doing this with tennants immediately after they have passed background check.  

Sounds like it is too late now for that now unfortunately.

If there was a deposit to hold agreement signed and dated stating the monies given will be non-refundable if certain requirements are not met by said date, etc. then you might have a nice solid case in not refunding anything back.  You also might have something to work with though if there are specific expectations in the email detailing how one would not receive the deposit back if they fail to move in on said date.  

Signed and dated deposit to hold agreements really help clarify each others expectations and responsibilites.  But I am newer and do not have the experience of others on BP so I am interested in what they have to say.  

Good luck though. 

in my state of vermont , for a lease we must try to re-rent it , if not we keep the deposit . i tell my tenants that i really don't need to keep the deposit , i hopefully will return it all if they abide by the terms. i charge for my time and effort to re-rent and return the rest . i think as long as you make an effort , you have done your part .

Let them go with a full refund and a smile. It's one thing if they want to break the lease after moving in, but before? One less headache in my opinion. Happy transactions occur between ready, able, and willing parties. I'd be ecstatic to know my tenant was unwilling before moving them in. You've probably saved yourself thousands in repair costs and premium increases by not holding their feet to the fire.

He seems to be offering to help find a new tenant. I could just offer him $500 back in the event I find a new tenant to get him to accept it via writing/text message. He has already agreed that if I can't find a tenant he understands me keeping the full deposit. But if I offer him $500 if I do find a tenant and he accepts it, I can clean my mistake of not getting it all in writing upfront.

I have applicants turn in a $400 holding deposit with their completed applications, etc. The holding deposit is only non-refundable if the tenant is selected and fails to occupy the unit (bails out at the last minute). Otherwise, if they are not selected for any reason it is fully refundable. When they move in, it applies toward their security deposit.

I have found this helps cut down on unnecessary showings from those who may not be completely interested. It also helps weed out those who don't have enough money to move in possibly. And, when the move-in date is approaching, I can rest easily knowing that if they do bail out on occupying the unit I get some payment for the trouble.

Quick question: Why did it take 2 months to find this potential tenant?  I you need/want some screening / advertisement advice, PM me. I can share some resources that helped me.

Good luck up there in Seattle!

Dave

Elma, WA

I continue to market the property for lease until I have a signed lease and the deposit.

Prospects are advised of this (creates a sense of urgency) and the full force of the lease is in effect if they don't take possession.

It's different in my world as an agent, because once the lease is signed and deposit paid, there may be commissions to pay for co-brokerage (leasing/buyers agents), etc. The deposit would go to satisfy those obligations.

I would say give the him his deposit back as he didn't sign anything.We try to sign the lease within 3 days upon approved application, don't stop marketing until it is.

Originally posted by @Jack B.:

He seems to be offering to help find a new tenant. I could just offer him $500 back in the event I find a new tenant to get him to accept it via writing/text message. He has already agreed that if I can't find a tenant he understands me keeping the full deposit. But if I offer him $500 if I do find a tenant and he accepts it, I can clean my mistake of not getting it all in writing upfront.

I think my strategy above is favorable to all parties and allow me to secure in writing an agreement to that effect via email.

He get's some of his money back, I get to keep some of the money for my time and hassle as well as risk of not finding a tenant in time and I get something in writing. He has already agreed in writing that I keep the full amount if I can't find a tenant in time, but I think it would help my case to offer some of his money back if I find a tenant and get agreement to that now in writing, so that there is no legal issue.