Should I kick them out?

Should I kick them out?

Investor · Washington, Washington D.C. · Member since 2012 · 239 posts · 168 votes

A 3/1 townhouse I own in Baltimore was trashed by a Section 8 tenant who moved out at the end of 2016. I spent more than I expected getting it back in shape. Then had difficulty renting it for several months, for various reasons, some of them my fault. 

Finally brought in a property manager, who immediately placed a tenant, one of his workers, who for some time has wanted to move out of the efficiency he occupied with wife and child. 

So far so good. I liked that the tenant would have a work relationship with the property manager, so would have an extra reason to not mess up the unit. They were set to move in first week of August. 

BUT--the tenant, named Cesar, immediately brought in 2 relatives and their 2 children after he signed the lease for only himself and his wife and child. That makes 7 people—the legal limit for a 3 bedroom house. Had he revealed his plans up front, and had his relatives signed the lease with him, maybe I'd feel differently. But he chose to do it in this sneaky way instead, thereby losing my trust.

Last week he also held a big family party with a lot of yelling and noise that caused a disturbance in the neighborhood (a neighbor called me to complain). I have built good relationships with the neighbors, many of whom are elder homeowners, who watch my property protectively. BTW, it was the neighbor who revealed that there were a great many more people in the house than I'd bargained for. 

Finally, the property manager screened them and I didn't get involved (foolishly, it turns out). But what I've learned subsequently makes me think the family is in the country illegally. Cesar's ID is a provisional driver’s license. His wife’s ID is her driver’s license from Guatemala. 

Now, if they had shown better judgment, their legal status wouldn’t bother me. But the way things are these days, if someone calls the police, say, for a noise violation, they could wind up deported! This is not farfetched under this administration, such things are happening in the community daily. So if they don't have the sense to act responsibly and protect themselves in this insane environment, they put my investment in jeopardy.

Also I have no idea about his relatives—their legal status, their jobs, their income, their credit, their criminal records--the manager has yet to screen them. I also worry about the wear and tear of seven people in the unit even if technically it does not exceed the legal number.

Property manager thinks I should let them stay, all 7 of them, but negotiate a higher rent and a 2-year lease. He thinks we can do quarterly inspections to ensure they are taking care of the unit, and make the tenant responsible for getting them fixed. 

I truly don’t know what to do. Should I let the unit be empty again after all those months? Let this family stay, even if I don't trust them? 

I'm sure I'm missing something obvious in this situation. Please tell me what it is! 

Many thanks,

Nancy Roth

Washington, DC

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Gary NelsonBusiness Member
Real Estate Agent · Branson, MO · Member since 2016 · 141 posts · 93 votes
9y
I vote to replace the property manager. All of this should have never happened in the first place. I wouldn't tolerate it - hold the manager accountable.
Gary Nelson Real Estate, EXP Realty, LLC553 Reviews
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  • Sherman Oaks, CA · Member since 2013 · 3k+ posts · 2k+ votes
    9y
    Originally posted by @Nancy Roth:

    @Matthew Olszak and @David Michael you guys have a great point. But I also think there's value in the point that many have raised, which is about setting a tone early in the relationship. It's not about controlling the tenants so much as controlling the property. They do not get to do whatever they want, even if they pay the rent. They've already shown, at the very outset, that they have no regard for the most basic boundaries and I have no reason to believe they will change that. The manager thinks they can be made to change. But one thing I keep hearing from these comments is, how good a job has this manager done in putting them in there? I didn't even enter the conversation considering that, and the insight is really helpful.

    This has been a great conversation, thanks to everyone for writing.

     I did not see this mentioned but many leases have an additional occupant charge clause. 10% per additional is common I think. 

    Good luck! 

  • Investor · Kalamazoo, MI · Member since 2015 · 30 posts · 5 votes
    9y

    I think @braden downs hit the nail on the head, make an addendum to the lease with an increase and regular inspections of the property if your not local have the "new" management company do a walk though with you on facetime. The ultimate problem here is your management company, they need to be replaced and you should keep a close eye on your current tenants.   

  • Investor · Washington, Washington D.C. · Member since 2012 · 239 posts · 168 votes
    9y

    @Matt R. I hadn't heard of an additional occupant charge in a lease. Sounds like a great idea but the leases I'm familiar with specify who is an occupant, and no one else is supposed to be living there. Wouldn't a clause like that in the lease be counterproductive? Do you have any examples of a situation when that provision can be applied?

    Also it would be problematic in DC, where "familial responsibilities" is a protected class, meaning the landlord cannot prevent a tenant from supporting a person in a dependent relationship, including (but not limited to) parents, children, and grandchildren. I doubt the landlord could increase rent in that situation. 

  • Rental Property Investor · Brooklyn, NY · Member since 2013 · 272 posts · 165 votes
    9y

    I had a somewhat similar, somewhat related situation many years ago with a Tenant who operated a daycare in one of our properties, causing our insurance to quadruple. I had the same question: Kick em out, or not? 

    Here's the link: https://www.biggerpockets.com/forums/52/topics/109...

    In the end, we raised their rent significantly (enough to cover most, but not all of the added Insurance cost) but kept them on as Tenants. F-fwd almost 5 years later, they are still with us,  and have proven to be pretty ok tenants. Not perfect, but on balance, after several honest conversations about what was expected of them if they wanted to remain, .. Good.

    Hope this helps.

  • JD MartinBusiness Member
    Moderator
    Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes
    9y
    Originally posted by @Bettina F.:

    I cringe every time I hear a phrase from a LL like "kick them out".  I don't kick people out,  I enforce rental agreement provisions.  When tenants do not follow the terms the rental agreement  I terminate the tenancy.  All 100% legal, and all within my rights as a LL.  I follow the law with regards to Security Deposits.

    LL face enough discrimination and bad press in the eyes of the public without us using terms like "kick them out".    Be careful.  That language and attitude can come back and bite you. 

    I will get off my soapbox now.

     Google "George Carlin and euphemisms". :)

    Skyline Properties
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  • Investor · Washington, Washington D.C. · Member since 2012 · 239 posts · 168 votes
    9y

    @Michael G. Thanks for writing. I just had a conversation with a local buddy of mine, and she would agree with you. She said, y'know, it may work out. You get the extra rent and extra deposit, you rewrite the lease to include everyone who is in there, you make the rules very clear. They may be glad to be allowed to stay.

    I understand that a daycare business is an extremely stable tenant, it's hard to beat that. Good for you that you found a way to make it work. Stability is where it's at for me.  

  • Sherman Oaks, CA · Member since 2013 · 3k+ posts · 2k+ votes
    9y
    Originally posted by @Nancy Roth:

    @Matt R. I hadn't heard of an additional occupant charge in a lease. Sounds like a great idea but the leases I'm familiar with specify who is an occupant, and no one else is supposed to be living there. Wouldn't a clause like that in the lease be counterproductive? Do you have any examples of a situation when that provision can be applied?

    Also it would be problematic in DC, where "familial responsibilities" is a protected class, meaning the landlord cannot prevent a tenant from supporting a person in a dependent relationship, including (but not limited to) parents, children, and grandchildren. I doubt the landlord could increase rent in that situation. 

    For sure the original leased occupants on the lease. This clause would not prevent any class from living there, it just charges accordingly for any new occupants added later. IDK DC, it works in rent controlled LA. 

    Good luck!

  • Investor · Washington, Washington D.C. · Member since 2012 · 239 posts · 168 votes
    9y

    @JD Martin

    Google "George Carlin and euphemisms". :)

    ///

    I did. Hilarious. Wow he was great.

  • altamonte springs, FL · Member since 2014 · 8 posts · 4 votes
    9y

    @Robert C. I couldn't have said it better sir, your experiences with renters tell the same stories as mine.  I've come to learn that face to face meetings tells me nothing more than whether or not they showered before they came to see the house.  As far as what kind of people they are, it always comes out in the screening process. I can't tell you how many times I have left an open house with a great feeling about a prospective tenant just to find out they lied about their criminal history or evictions etc.  STICK TO YOUR PROCESSES! it's the only fail safe I've found.  Trust but VERIFY everything you can.

    @Nancy Roth  I know this is not exactly pertaining to your specific situation but along with what @Robert C. said I think you'd be better served I can't believe so many people are suggesting you leave in a bad tenant. good luck with your situation hope all ends well.

  • Investor · Washington, Washington D.C. · Member since 2012 · 239 posts · 168 votes
    9y

    @Matt Paris @Robert C. You both made great points. I'm really torn about it. 

    The timing makes it hard to empty the unit at this point. We're at the end of summer, once school starts and the weather turns, the rental prospects thin out a lot in Baltimore. Not impossible to get a tenant, but it gets a lot harder. So if I start an eviction now it could be well into fall before we're ready for the next tenant, and it's quite possible I'd be looking at several more vacant months. I have struggled in fall and winter before, with this and other units, and I don't look forward to it again. 

    Sorry to whine on you. I suspect the seasonal factor is a little less pronounced in Florida and California.

    But it's not all bad.

    I've been learning a lot in this forum, plus in local conversations, and have now formed a plan. Tomorrow I will meet with PM to discuss and then we will go to the unit. 

    I've proposed the following package: 

    -Lease will be scrapped. 

    -We will offer a very stringent month-to-month lease, with hike in rent and security deposit, requirement that the residents strictly maintain the exterior, front and back. 

    -We review the "quiet enjoyment" clauses with them and ensure they understand clearly what that entails.

    -We follow up with unannounced monthly walk-throughs in the first three months to count beds, and after that unannounced quarterly walk-throughs. 

    -Any additional occupant is grounds for vacating in 30 days.

    -We get 30 days notice to end the tenancy but they have to give us 60 days notice to move out. 

    I've asked for a lease for them in Spanish as well. 

    Being extremely watchful, we'll see if we can get through the next few months, and if we see it's not working, as you warn it won't, we vacate in the spring and start over. 

    If there is no way to avoid vacating, okay we'll do it. That's life.

    The PM is on extremely thin ice as well and may be history before it's all over. 

  • Real Estate Broker · Chicago, IL · Member since 2015 · 1k+ posts · 2k+ votes
    9y

    @Nancy Roth That seems very reasonable and fair. I missed in the beginning that you have a PM - that's nuts that you have to deal with this issue yourself, that's what you pay the PM for! Once you get the issue with the tenants settled I'd ditch this PM. Not because a bad tenant was placed, but rather how it was handled.

  • Investor · Washington, Washington D.C. · Member since 2012 · 239 posts · 168 votes
    9y

    @Matthew Olszak Yep. I hate to, honestly, I really need the support, but it doesn't seem to be forthcoming. Soooo frustrating. 

    Really appreciate your thoughts, thanks for writing.

  • Real Estate Agent · Tucson, AZ · Member since 2014 · 59 posts · 30 votes
    9y

    I have employees from South of the Border and their licenses are often in limbo. They operate on a foreign license and the states allow this. It doesnt indicate their immigration status. It does prevent them from having to content with tickets and points. Its a bizarre grey area that needs to be closed. 

    Id say you should never rent to employees because it weakens the strength of your investments.  Business starts to slide and now the tenants arent paying either.  Better to keep it fully diversified.  

    In the long run you need to decide if these people paying the rent on time is enough for you to tolerate their lifestyle.  It sounds like a cultural thing.  You ever been to a Mexican birthday party?  Man there are tias and tios and cumpa from all necks of the woods.  These cultures are not typically litigious so your probably out of the woods on that issue but you may be better off letting them ride out the year. They may be long long term tenants if you tolerate their style.  One of my employees lives with 6-8 other people (all familia) and they have rented the house for two generations now.  They have no doubt paid the landlords mortgage. Dont over look the potential.   Bueno Suerte.

  • Real Estate Investor · Sacramento, CA · Member since 2010 · 292 posts · 103 votes
    9y

    Normally, I'd say kick them out, but since you've already suffered through vacancy, I'd try to salvage things. Insist on higher rent because of more people, and bigger deposit, too. Their possible illegal status should motivate them to behave themselves to avoid being deported. Being latino is a plus, I think. My experience with latino tenants has been good, for the most part. They usually always work, and pay their rent on time. 

  • Investor · Jasper GA · Member since 2015 · 1k+ posts · 1k+ votes
    9y

    @Nancy Roth Sounds like a good plan. 

  • Sherman Oaks, CA · Member since 2013 · 3k+ posts · 2k+ votes
    9y
    Originally posted by @Nancy Roth:

    @Matt Paris @Robert C. You both made great points. I'm really torn about it. 

    The timing makes it hard to empty the unit at this point. We're at the end of summer, once school starts and the weather turns, the rental prospects thin out a lot in Baltimore. Not impossible to get a tenant, but it gets a lot harder. So if I start an eviction now it could be well into fall before we're ready for the next tenant, and it's quite possible I'd be looking at several more vacant months. I have struggled in fall and winter before, with this and other units, and I don't look forward to it again. 

    Sorry to whine on you. I suspect the seasonal factor is a little less pronounced in Florida and California.

    But it's not all bad.

    I've been learning a lot in this forum, plus in local conversations, and have now formed a plan. Tomorrow I will meet with PM to discuss and then we will go to the unit. 

    I've proposed the following package: 

    -Lease will be scrapped. 

    -We will offer a very stringent month-to-month lease, with hike in rent and security deposit, requirement that the residents strictly maintain the exterior, front and back. 

    -We review the "quiet enjoyment" clauses with them and ensure they understand clearly what that entails.

    -We follow up with unannounced monthly walk-throughs in the first three months to count beds, and after that unannounced quarterly walk-throughs. 

    -Any additional occupant is grounds for vacating in 30 days.

    -We get 30 days notice to end the tenancy but they have to give us 60 days notice to move out. 

    I've asked for a lease for them in Spanish as well. 

    Being extremely watchful, we'll see if we can get through the next few months, and if we see it's not working, as you warn it won't, we vacate in the spring and start over. 

    If there is no way to avoid vacating, okay we'll do it. That's life.

    The PM is on extremely thin ice as well and may be history before it's all over. 

    Perhaps change additional occupant is grounds for vacating...what if they have a baby? That would be discriminating against families. 

    Change to " Added per Occupant Rent $ 10% " or pick a dollar amount 10% or less.

    This above line goes just below listed names of original occupants. Like this below. 

    Occupants- Jose Aldo, Roberta Duran. Then next line " Added per Occupant Rent $ 10%. 

    Good luck!

  • Investor · Washington, Washington D.C. · Member since 2012 · 239 posts · 168 votes
    9y

    @Jason K. Thank you. What we have in Maryland and I think in DC is "provisional" licenses explicitly for what I'd call non-legal (not "illegal") residents. Maybe they've been here a very long time, own property and business, have had kids (citizens) here and are in line to become citizens. Or maybe they are very newly arrived. Whatever. Their residential status is unresolved, so they can't get licenses, but the state believes they will drive if they have to, and it's better to make them learn the rules and pass a drivers test, so it gives them this provisional license. It's controversial, with a lot of people protesting that nonlegal residents shouldn't get any kind of license or accommodation at all. 

    I'm ignorant of all the specifics but I do know what that provisional license is for. And in Maryland at least, although the provisional doesn't reveal where they are in the messed up system we have, it does indicate they are not legal residents. 

    I agree with everyone here, including yourself, that if they are good tenants their status shouldn't matter. I do have to think of it as an additional risk for my investment, though. Especially if they act like fools and upset the neighbors. 

    It also sounds like a lot of LLs on this forum are ambivalent about hearing from the neighbors, and I can understand why. But to me they are important allies, and it makes a lot of difference to me that their eyes and ears are on my property. They get my respect, and they haven't ever abused it.  

  • Investor · The Creek, WV · Member since 2014 · 890 posts · 1k+ votes
    9y

    I never care how many people are staying there as long as I get my rent money and they take care of the place.

    Either way, I would find a new property manager. You are paying someone else so you don't have to deal with headaches like this. 

  • Investor · Washington, Washington D.C. · Member since 2012 · 239 posts · 168 votes
    9y

    @Matt R. Yes it would be discriminating on familial status, if the property could legally accommodate another person. But we are at the legal limit. The max a 3-bedroom home can legally house is 7 residents, 2 per bedroom plus one more. 

    So we tell them, we are at the maximum number of people this unit can legally house, and if you add anyone we are breaking the law to house them here. If you have another baby, you need to find a bigger house or someone in the home has to move out. 

    Don't you think that would work?

  • Sherman Oaks, CA · Member since 2013 · 3k+ posts · 2k+ votes
    9y

    I am not sure. I think it is 2 per room vs bedroom out here. I think folks can legally use a living room for occupancy purposes as well for example. So out here 4 or 5 could legally be in a one bedroom. Two parents plus one baby in bedroom, then two more in living room. Room/space is 70 sqft+ and not kitchen or bathroom. If you are maxed out occupancy to start maybe different type case or lease conditions.  Good luck!

  • Investor · Washington, Washington D.C. · Member since 2012 · 239 posts · 168 votes
    9y

    @Matt R. thanks. Back East (in DC and MD at least) the number is 2 per bedroom plus one--and it doesn't matter where they sleep. Two parents and a baby can sleep in the one bedroom, or they can arrange themselves however they want, but the number of people in the unit overall is limited by that formula. Similarly a 2 bedroom unit can host a maximum of 5, again 2 per bedroom plus 1. It's a fire code thing. Too many in a unit pose a safety hazard.

    But no regs that I know of say where people must sleep. Friends of mine went through a phase of putting their baby to sleep in the laundry room b/c the dryer soothed her to sleep. Why not? 

  • Investor · Chicago, IL · Member since 2016 · 1k+ posts · 930 votes
    9y

    @Thomas S., your response is a bit harsh. I'm sure when you started out you had questions about things that you were second-guessing. I know I did. Many times in real estate you only need to ask once! Saying the original poster should rethink this business is asinine!

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