Can I reject an applicants request to withdraw their withdrawal?
Coconut Creek, FL · Member since 2016 · 57 posts · 22 votes
Lol no this is not a riddle. I actually had an applicant that was going through the screening process with the HOA of my community request to withdraw the lease agreement. The applicant did not want to wait any longer for an approval for the HOA and decided they wanted to move on. After informing the applicant several times that they will lose their deposit they kept trying to tell me that I owed them their deposit. The very next day they sent me a request to withdraw their withdrawal. I really do not want this person in my home right now. Am I allowed to reject this last request, legally? I already listed my home for rent again and am receiving inquiries for rent now. I have all withdrawal request in writing.
@Kimberly H. yes I agree it is a really long time. I spoke with the property manager and she told me that is the normal time frame. Obviously everyone disagree with that here. Not sure why the property manager thinks that's a normally time frame for approval.
@Deanna McCormick My agreement does not say anything about the time frame for the HOA to approve. It just mentions being approved prior to lease term date.
Your thoughts are what I assumed were the correct thing to do. Also after speaking with 2 attorney's they also agreed with you after reading through my lease agreement. I see a lot of comments saying otherwise, that I should give the money back and that I would be wrong for keeping it.
@Account Closed Nope your not wrong keep the money.. and if your agreement says being approved prior to lease term date you are within your rights to retain the holding deposit.. that covers the terms of the holding deposit. they cancelled .. you didn't
Cheers
@Deanna McCormick That's exactly what both attorney's told me.
Refund their money and drive on. This isn't worth fighting about. Find another tenant who is more solid and never look back.
I really don't think you're in the wrong to keep it. The applicant canceled the contract, not you. Also I'm assuming you are missing out on rent during this time because now you will have to present a new applicant and wait another 30 days. People bashing you because it's easy to say just give it back, it's another to do it. By the way, how much money are we talking about? And someone mentioned going to the media? PLEASE. The news isn't that slow these days.
Andrew from the legal perspective I think your lawyer friend answered that. But the law isn't what made you go into business. I think the consensus here is that regardless of the law you need to do what is right for your business.
I reached out to a friend of mine who is a lawyer. I had him review all of the documents and he told me that since the tenant decided to breach the contract prior to approval of the HOA before the lease term I do have the right to hold the deposit. He even took it a step further and said I even have the right to ask for the early termination fee which is 2 months rent according to our lease agreement. He explained to me that once someone writes a withdrawal of an offer, the contract is then terminated and no longer exist. So if the person then comes back and says they changed their mind, I can say the offer was already withdrawn and that's it. I had a change of heart and now I've decided not to be nasty and just give the money back and move on to another renter.
If you do decide to keep the deposit, Good luck in court - I have a feeling the judge is going to eviscerate you :)
-Christopher
@Account Closed lets look at generalizations. A few things that I do is to Bold any monies clauses in my agreements. I make sure that I have them initial next to them as well. I have that discussion, usually over the phone/email before they sign anything. At that point I am covered. I have heard of others offering a scale in away that they would get back xx% after x days and so on. That is not for me.
With that being said I dont want tenants that are a potential financial nightmare. We have no idea what is going on and we dont care to a point. Great so lets say they pass HOA approval but 2 months in they have to leave. The signs are there. Listen to them.
As you can see I have little hair. I hope to keep what I got for a while more. Having done what I mentioned above. I would keep the holding deposit. Outside of that I would give it back and wash my hands of it.
@Account Closed
Not sure if you were using the Contract to Lease Form by the Florida Realtors for your initial lease offer. If so, in section #8 where it says Failure to Perform, you would be entitled to the holding deposit if you explained to the tenant it would take 30 days to be approved by the HOA and they withdrew or terminated early. Did you have a similar Failure to Perform clause on a contract written up by yourself that they signed off on?
I think you are entitled to the holding deposit if you used the forms by the Florida Realtors or had a similar failure to perform clause that they were made fully aware of.
Even though we don't know the full situation of events that led to the tenant wanting to withdraw their offer when they knew it would take 30 days to get approved. I think people are questioning if is the right thing to hold their funds considering that the tenant might be out of money they could use to find something else. It doesn't mean she is entitled to the funds because I get that you lost out on time and getting someone in there. However, you don't want to be known for holding tenants money if they don't have a place to move into.
Also keep in mind that word could spread about how you do business on social media or you could end up getting bad reviews about how you conduct business. I personally do not like bad karma or energy coming back to me. I would refund the money, make steps to prevent it from happening again and move on.
@Michaela G. I understand what you are saying. if the condo had declined the tenant I definitely would not keep the deposit as it states in the lease agreement. What i'm trying to ask is if prior to signing a lease agreement, the applicant was made aware that the hoa approval process takes up to 30 days, (it's in writing on their application form for the HOA.) then on day 26 or day 27, the applicant says the HOA is taking too long I want to withdraw my offer. Everyone is saying return the money, which I said I would, but just for learning and understanding, why is she entitled to receiving her deposit back?
Piggybacking on what Michaela and Michelle both said technically the condo was not "held". On day 30 the HOA could have very well declined the lease and this person would have had no choice but to move on anyways. Just from what I read the holding deposit could only be used if the tenant was approved and then moved in let's say 2 weeks later. Just as it's frustrating to you as a landlord having a tenant wait 30 days just to find out if they are accepted into a place it's frustrating to the tenant. I understand you say the tenant knew upfront the wait but if they were in dier need of a place to live and they found a for sure apt can you blame them for choosing that? Of course then they would then need their deposit for the new place. Just a different perspective to put yourself in their shoes. For future reference consider screening the tenant better to insure they are in the position to wait for a 30 day approval process and speak with your HOA to see if there is any way to streamline the process. Most importantly for the next rental property you buy consider 1 that does not have an HOA or that will accommodate your needs better. Hope this helps.
**not a lawyer this is not legal advice**
If you don't want them in the property you have every right to deny them but you have to give the deposit back.
@James Wise Doesn't sound like he has to according to his contract.
@Samuel Awosolu It doesn't matter that the tenant could use those funds to find something else. They broke the contract, they suffer the losses associated with that. If we all got our money back every time we had buyers remorse there would be no point of contracts.
@MarieChele Porter If the tenant was in dire need of a place to live then they shouldn't have signed a contract saying they would wait the 30 days to be vetted by the HOA.
I see the pity side of it towards the tenants, but they signed a contract and then decided to cancel twenty something days later. There are costs that go to towards the OP due to the loss of rental income, why is nobody throwing him a pity party? He didn't do anything wrong.
@Account Closed Are you running a business with a website and all that advertises rental properties where people can leave reviews? If so you could have a negative review, so compare that to how many positive reviews you've had and see if it's worth $860 to have a bad review. If you're just renting a single property I wouldn't worry about it. Show the old prospective tenants the contract and highlight why they aren't getting the hold money. It's not exactly going to make headline news or tarnish your name because you stuck to a contract.
In my experience of knowing the right course to take, I have come across a fairly common truth:
"The right choice never needs a 'context' or 'justification'. Right is right."
Meaning that if you need to find support from others as to why you are justified in your actions or have some conflict with your decision, you may need to check your premise.
That may be a little deep, but it always steers me toward the right answer.
@James Wise Doesn't sound like he has to according to his contract.
@Samuel Awosolu It doesn't matter that the tenant could use those funds to find something else. They broke the contract, they suffer the losses associated with that. If we all got our money back every time we had buyers remorse there would be no point of contracts.
@MarieChele Porter If the tenant was in dire need of a place to live then they shouldn't have signed a contract saying they would wait the 30 days to be vetted by the HOA.
I see the pity side of it towards the tenants, but they signed a contract and then decided to cancel twenty something days later. There are costs that go to towards the OP due to the loss of rental income, why is nobody throwing him a pity party? He didn't do anything wrong.
@Account Closed Are you running a business with a website and all that advertises rental properties where people can leave reviews? If so you could have a negative review, so compare that to how many positive reviews you've had and see if it's worth $860 to have a bad review. If you're just renting a single property I wouldn't worry about it. Show the old prospective tenants the contract and highlight why they aren't getting the hold money. It's not exactly going to make headline news or tarnish your name because you stuck to a contract.
Like I said I understand that he said the client was informed of the 30 day wait and no he shouldn't have put the deposit down if he wasn't in the position to wait the 30 days, however do you think it would be worth the trouble of fighting with the tenant over the $850 some odd dollars or rejecting the tenant and keeping the deposit as he previously asked? As a landlord I do believe it's important to uphold strict rules but at the same time I think it's still smart to pick your battles. It would be different if it was a problem after the tenant had already moved in but this person seems like they would have been a problem anyways and he probably dodged a bullet. For me yes he missed out on at least 2 months rent as he has to restart the process, but I don't see it for me being worth it to even fight with this person over the deposit.
Be careful. Whatever you do, do it consistently and with the utmost consideration for people's circumstances. The last thing you need is a lawsuit. I vote to return their money, and change your policy about collecting funds while the app is still in need of approval.
Have a first come, first serve policy so that you can collect other applications up until you an HOA approved tenant. Give them 24 hours to put down all fees AFTER HOA approval, and then move on to the next applicant.
In regards to not renting to them just because they rubbed you the wrong way, I get that. I really do. BUT, while its within your rights to not rent to them, it's within their rights to sue you because of some sort of discrimination, whether they have proof or not. Trust me, it happens. Be smart, be nice, keep excellent records, and stay consistent in your habits.
Good luck!
Thanks @Patrisha Leybovich. Interesting idea of the first come first serve policy.
Since this is my first rental property, I am trying to be very careful of what I do, that's why I posted this question here, and asked so many people outside of bigger pockets as well, what can I and should I do in this situation. I'm not just trying to go after someones money for no reason.
I understand that a tenant may have the right to sue for discrimination. And for that very reason I asked if I had to rescind an applicants withdrawal when they tell me to a day later. To me that was strange behavior and I was unsure about this persons character at that point. I did pre-screen this person before passing them over to the HOA and everything checked out ok. So in that situation, would you say I could be sued for discrimination If I decided not to rescind the withdrawal?
First off, I'm not an attorney. I am, however, well versed in landlording. Yes, you can be sued for discrimination by anyone at anytime. Sometimes when you least expect it. Your best defense is solid practice and excellent record keeping so that you're ready if it/when it hits you.
Best to not treat rental applications for SFRs like a contract you can enforce. Its just an application, and according to your requirements, not even a fully accepted one since the HOA has to sign off on it.
I would recommend reviewing your application procedure to be considerate of the applicant's situation. Put your procedures in writing and include them in the app.
Follow the guidelines religiously. Good luck!
@William Walker This is my first rental property. It's the home I lived in for 3 years with my wife. We don't have a website or anything like that since we are just starting out. Since I am a new to land lording, I try to ask a lot of questions before, after and especially when I get into things. I also tell my applicants that I do everything based on what the documents say. So whenever they ask me something and I'm not sure I actually tell them I'll have to look over the documents. So all of these comments are helpful. I definitely agree it is not worth $860 and I've already agreed to give the money back.
@Ethan Atkinson Yes I did. I thought that's what you are supposed to do when someone gives you a deposit to hold and says I will wait over 30 days to move into your home, signs a bunch of paper work holding them contingent to approval. Lesson learned, maybe I should just keep taking the applications.
@Patrisha Leybovich I am trying to follow my guidelines religiously, That's what a lot of people seem to be disagreeing with. In my case, how can I be more considerate to the applicant with my application procedure? I don't make the rules on the HOA approval process.
Just don't take any money upfront. Continue taking apps until you have both and HOA approval and all funds received with 24 hours of HOA approval. Make sure everybody knows you are first come, first serve. Apps need to pass you, then HOA, then all funds received before the property is off market. This is just the honest reality of it anyway.