Property Manager · Ladera Ranch, CA · Member since 2016 · 17 posts · 9 votes
Hi All,
I have a future tenant that signed a lease and has given a security deposit already. I just received a call though from one of their references telling me to not let them move in and that they were in his presence when I first called them as a reference. He is from a foreign country and has no real credit/ rental history. I called his work and his income is verified. The reference told me that he will pay the first month and not pay again and that he has children so it will be extremely hard to evict him. I'd rather just not have him move in than go through all the hassle. Any info on this would be of great help!
Property Manager · West Palm Beach, FL · Member since 2012 · 296 posts · 143 votes
9y
I know in our lease we have stipulation that if we find on the application something that was a lie we have a right to cancel the lease. But in your situation I would bite the bullet and let him know that one of the references came back with non pay and if he can verify that it's not true then we have to cancel the lease. Its simple to verify if its true just ask them to show 12 months of bank statements showing rent being paid or voided money orders. if he doesn't have a bank account and no other way to prove that he has paid on time during that lease then you have to side with the reference. Him getting in the property and you having to evict can take a longer time than you telling him verify the allegations that a previous landlord sent to you about him. If its true than its good you caught it now and not later down the road.
Rental Property Investor · The Vampire State · Member since 2013 · 2k+ posts · 2k+ votes
9y
I think you are stuck. You could try and not follow through with the contract, but I expect he will fight you on this, and based on geography you'll won 't encounter much sympathy from the legal system.
Consider your potential economic loss as "tuition" for next time.
You have a legitimate reason to reject the applicant.
You can document that you received questionable feedback from a reference.
You should run it by an attorney. You'd be better paying a few bucks to cancel the lease properly rather than have the tenant move in and potentially stop paying after a month or two...
Property Manager · Ladera Ranch, CA · Member since 2016 · 17 posts · 9 votes
9y
Now would you think its easier to fight them in court for breach of contract or go through the eviction process and possibly have them destroy the brand new unit?
Give the bad reference, you'd be better rejecting them now rather than later. When you tell tenants you're rejecting them due to something in their application, like credit history or references, they usually don't fight it.
Property Manager · Ladera Ranch, CA · Member since 2016 · 17 posts · 9 votes
9y
I am still trying to get ahold of the reference since they talked to another person at our company. I will definably verify everything she is saying is true and it is not caused by any other circumstances. But I was told that he was very adamant about not letting him rent and that one I talked to her when I first called her that the Tenant was in her presence at work and could not say what she really wanted to say. It did make me think back to when I called his references and they all pretty much seemed to say the same thing about him. Maybe they were all his co workers or something? Not too sure but just getting a bad feeling about it and don't want to go through the hassle of eviction.
Rental Property Investor · Seattle, WA · Member since 2014 · 1k+ posts · 1k+ votes
9y
Look carefully through the lease and see if there is any out. My lease has an out in that I reserve the right to sell the property. At least from what I remember. Also, are they on a month to month lease? ALL of my leases are MTM so I can easily get rid of someone compared to a 12 + month lease. Also, I've learned the hard way to check and verify everything, references, employment, where they lived before, etc. I now have a 2 day minimum between when their application gets run and when I will let them move in, partly so I can let things cool and make sure there aren't any red flags.
I had a tenant one time who wanted to move in RIGHT AWAY. Sob story to boot. Turns out they were a professional tenant, and although the passed the bg check, it wasn't until they suddenly moved out in the middle of the night before they were about to get eviction proceedings started against them and they pulled the same scam on the next guy, that I realized this is why they had no address history on paper for 10 years and also no evictions: they never stay anywhere long enough to establish utilities or get evicted.
In the end, the MTM lease and my emails with them saved the day.
Property Manager · Ladera Ranch, CA · Member since 2016 · 17 posts · 9 votes
9y
@Account ClosedThese are all 12 month leases because they are brand new build to keep townhouses and the banks need to see all 12 month leases within 6 months of completion.
Investor · Carlsbad, CA · Member since 2012 · 73 posts · 34 votes
9y
@Derek Bonanni if you really HAVE to terminate the lease, and you're using the standard CA Association of Realtor's lease, it has a clause says "if .... that render Premises totally or partially uninhabitable, either Landlord or Tenant may terminate this Agreement by giving the other written notice." eg. if the place is uninhabitable (flooding, pest, mold etc) before moving in, you can terminate the lease and return the deposit (plus some good faith money). You might have to "create" some proof/evidence to backup your excuse and keep it off market for a while.
@Derek Bonanni if you really HAVE to terminate the lease, and you're using the standard CA Association of Realtor's lease, it has a clause says "if .... that render Premises totally or partially uninhabitable, either Landlord or Tenant may terminate this Agreement by giving the other written notice." eg. if the place is uninhabitable (flooding, pest, mold etc) before moving in, you can terminate the lease and return the deposit (plus some good faith money). You might have to "create" some proof/evidence to backup your excuse and keep it off market for a while.
I was going to mentions this as a potential strategy, as my lease has this too, however; they can also demand that you put them up in a hotel or comparable accommodations until the issue is remedied. It's not fool proof.
Attorney / Multifamily Investor · Houston, TX · Member since 2009 · 173 posts · 136 votes
9y
This is a tough situation and this is not legal advice and I am not your lawyer :), but I'd just tell the guy you've changed your mind about the lease and that you will mail him a cashier's check refunding everything he's paid you (security deposit, application fee, whatever).
Yes, legally you are breaching the contract, but (a) there might be a clause in the contract that allows you to do so (though don't make something up like some are advising), and (b) if he were to sue you, he would still have to prove damages, and how has he been damaged? Unlikely he will suffer any significant loss due to the breach.
Of course, you are in California, so it's entirely possible that the punishment for a landlord breaking a lease is death. Consult a local attorney.
Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
9y
If he doesnt pay and has a history of that , did you check prior landlords ? Court cases ? If you do find you have to accept him , the minute the rent is over due , file for eviction . Hold him to the letter of the lease .
Rental Property Investor · Seattle, WA · Member since 2014 · 1k+ posts · 1k+ votes
9y
Originally posted by @Account Closed:
@Jack B. Landlords don't take checks and why should the tenant take a check just give the tenant cash and call it a day, and most tenants don't trust landlords with their new address.
Most tenants don't trust landlords with their new address? Even the people I kicked out gave me their new address. Not sure where you are getting this from....do you have any credible statistical source to back up this claim?
The tenant should and will take a check because I'm a business, not Joe Public...I'm open to civil liability if I write a bad check. It's kind of like how an employer does a BG check on you, a landlord does a BG check on you, etc. They tenant and employee don't do a BG check on the employer. They are a business.
Last but not least, no reasonable person would meet with a tenant that has this kind of background and give them cash along with bad news face to face. A check via certified mail is what anyone with common sense would send to avoid confrontation and ensure a paper trail.
This is a tough situation and this is not legal advice and I am not your lawyer :), but I'd just tell the guy you've changed your mind about the lease and that you will mail him a cashier's check refunding everything he's paid you (security deposit, application fee, whatever).
Yes, legally you are breaching the contract, but (a) there might be a clause in the contract that allows you to do so (though don't make something up like some are advising), and (b) if he were to sue you, he would still have to prove damages, and how has he been damaged? Unlikely he will suffer any significant loss due to the breach.
Of course, you are in California, so it's entirely possible that the punishment for a landlord breaking a lease is death. Consult a local attorney.
This is inline with what I said, except I would not give any explanation, so that if I do get sued, my attorney can come up with a better defense.
Property Manager · West Palm Beach, FL · Member since 2012 · 296 posts · 143 votes
9y
I know in our lease we have stipulation that if we find on the application something that was a lie we have a right to cancel the lease. But in your situation I would bite the bullet and let him know that one of the references came back with non pay and if he can verify that it's not true then we have to cancel the lease. Its simple to verify if its true just ask them to show 12 months of bank statements showing rent being paid or voided money orders. if he doesn't have a bank account and no other way to prove that he has paid on time during that lease then you have to side with the reference. Him getting in the property and you having to evict can take a longer time than you telling him verify the allegations that a previous landlord sent to you about him. If its true than its good you caught it now and not later down the road.
Rental Property Investor · Red Bank, NJ · Member since 2017 · 1k+ posts · 1k+ votes
9y
Sounds bogus to me. If the guy is a 1 month payer then he would never have given his real landlord as a reference, and I can't imagine his landlord allowing him to stand by as a reference was given. And then the real landlord calls back to say don't rent to him (and I assume leave them stuck with the guy).
how does someone who pays one month rent on a yearly lease not have evictions in his background check?
I say honor the lease, ignore the flake and most importantly improve your vetting process- it sounds like it is a mess.
Or throw it back in the other landlords lap- tell the tenant that you received information from the prior landlord that no rent was paid and ask him to provide you with proof of cancelled checks.
Investor · United States · Member since 2015 · 415 posts · 487 votes
9y
Don't make something up about the property being uninhabitable... terrible advice.
Few people refuse their money back in any setting. Very likely if you just send his money back tomorrow and once it arrives tell him the reason that he'll just disappear. He would have to be very motivated to start a fight about it, especially since he already has his money back first. He'll most likely become busy looking for a new place.
Real Estate Broker · Chicago, IL · Member since 2015 · 1k+ posts · 2k+ votes
9y
@Derek Bonanni So if all the hard-facts, like credit, background, and income are all good, why put so much weight on the statement of this random caller? I'd put my money on there being some sort of falling out between them and this is simply spiteful revenge. I'd share the call with your new tenant as a courtesy so they know they've got a dirty ex-friend going after them. But I certainly wouldn't act against your tenant based on this - and he is now your tenant, you've got an executed contract between both of you.
Investor · Post Falls, ID · Member since 2016 · 606 posts · 699 votes
9y
Did you do credit/criminal/eviction check on this applicant? Did you verify ID? If he has otherwise a clean background, it could be a disgruntled LL (or other person) trying to cause trouble. Verify the owner of his current rental via your county assessor's website, and try to call that person. I like Shaun's idea of having the applicant verify that he paid rent for the past year. Most applications have language where the applicant signs that of all information supplied is true. If it turns out he gave false information, that should be a reason to deny because you offered the lease under fraudulent circumstances.
Look at your applicant verification processes going forward to make sure nothing like this slips through again.