Can you deny tenant that has already signed the lease?
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!
Thanks!
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.
first, I would say that walking away from your mortgage is not breaking civil law. The contract says pay or lose the house...they choose the 2nd option. So the contract was enforced. The courts don't even have to get involved, you can just hand the bank the keys and go. I would also point out there is a difference between not being able to perform (no money) and just choosing not to perform.
Second, I agree that civil law is different than criminal law. However, it is still law. And I imagine that you are a big civil law fan when it comes to enforcing the parts of the contract you like such as paying on time each month and other provisions of the lease. So if the shoe was on the other foot, and the tenet had signed the lease, and an old tenet of the landlord said how "mean" the landlord was, would you be ok with the person breaking the lease and not moving in...without penalty? If you expect people to operate with integrity, you need to operate with integrity
Which brings me to my most important point. I would not sell my integrity for $5000 or $8000 for that matter. And it is not even a guaranteed $5000, this is all supposition, there is no proof the caller was even the actual reference or that they are telling the truth. This is a simple elementary school lesson, You gave your word, you signed a contract, you do your level best to meet the contract. If you are willing to break your word for a POSSIBLE $5000 savings, what does that say about you.
I understand the temptation, my argument is to hold onto that integrity and keep your contract
Breaking a contract is not breaking the law. There is no breach of contract jail. It is not ILLEGAL to breach a contract. In fact, any contract worth the paper it is printed on CONTEMPLATES that either or both parties might breach it.
And spare me with this talk of integrity. If the tenant induced the landlord to sign a contract under false pretenses, that's fraud at worst. And at best, it's incomplete information.
@John Nachtigall Let's say you're the landlord in this situation and the tenant shows up on move in day with a flame thrower attached to his back. When you inquire, the tenant says he's going to torch his new house as soon as you give him the keys. He just likes to watch things burn. Do you still hand him the keys? He hasn't done anything yet, and you after all, you signed the contract. AT WHAT PRICE, YOUR INTEGRITY?!?
This is a business arrangement. If the landlord has credible evidence that letting the tenant move in will cause him untold financial hardship, he would be... well, I don't want to say stupid, so let me say "not smart" to let the guy move in.
So the only law is criminal? Well you are a lawyer, so you would know, what do you call the system of rules that enforce civil contracts. As a layman I always thought it was called civil law, but perhaps I just watch too much TV. What do they call it in Texas?
As for integrity, do you remember this? (I bolded the words of emphasis)
The State of Texas.
I,____________ , do solemnly swear that I will support the Constitutions of the United States, and of this State; that I will honestly demean myself in the practice of law; that I will discharge my duties to my clients to the best of my ability; and, that I will conduct myself with integrity and civility in dealing and communicating with the court and all parties. So help me God
Now that is not my oath of office...that is yours. I assume you swore (solemnly no less) to have integrity. Perhaps yours was the a lesser oath where you only promised to "mostly be nice".
Now myself, I did not swear an oath. I actually just work in private industry, the medical device industry. We make stuff like pacemakers, stents, aortic implant, spinal implants, diabetes monitors and the like. The kind of stuff where if you mess up people die.
I work in the quality part of the business (Director of Quality), making sure the devices work and meet the law and such. It is mostly a civil law, or I guess I should not call it a law right, because it is civil? Not that it matters right...because it is just business. So the next time you and/or your family get a medical device do you want to wonder if I had integrity? Or would you just like to assume that I can't be bought. Your call.
I have scrapped millions of dollars of product on the POSSIBILITY that a single device could be defective....don't presume to lecture me on integrity. When you sell it, you can't get it back. It is not a joke or an abstract concept, it is real.
I agree with you Shaun. If there was a misrepresentation on their application, you don't need to accept their lease. Do what Shaun said!
I had a similar situation except it was a neighbor who saw me doing a move-in walk through with a tenant and called to warn me away. The tenant's girlfriend and the neighbor were in a hostile conflict and when the neighbor saw them moving in, the neighbor got really stressed. I had a meeting with my tenant and we talked it out. He explained why they didn't like each other and was very honest and straightforward with me. He is now moving out after month's of peaceful tenancy and just sent me a note thanking me for giving him a chance. Bottom line, have you thought about just having a conversation. If you do be completely open and honest with the applicant and emphasize that you care about their well being and peaceful occupancy. People tend to respond really well when you talk to them directly and are candid. My advice is to avoid a situation where you're seen as the bully bringing in lawyers or being dishonest about the livability of the unit. The applicant will be easier to deal with if they're not in a defensive position.
And to answer the question of credit report it came up as "NA" since he was from a foreign country I guess.
Read the information on the US Secretary of State's website. Foreign nationals who are in the country legally, with a work visa, apply for a SSN before they leave their home country. They are issued a SSN within 2-3 weeks of entering the United States. It is a different process for foreign students here on a student visa.
Woops -- I just realized that you did not say that he did not have a SSN -- just no credit report. I suppose it is possible that he has never used credit. Dave Ramsey fan perhaps?
Geez, anyone consider the possibility that this is all a very elaborate scam, designed to get the LL to cancel the contract, so the applicant can sue?
Just a quick update: I finally got ahold of the reference and she stated that he is using someone else's name (maybe the reason for no Credit Score?). She would not give me the name she needs knows him by. But insisted that we should not rent to him. I tried multiple times to get ahold of the future tenant but no response and went straight to automated voicemail. Was unable to get ahold of the previous landlord and when searching for the owner of that rental the names did not match and it is not ran by a manegement company. I did a little digging into the items that I have received from him. Both the SSN card and Drivers license are both hard to make out most of the information other than the #s and name. Also I took a hrder look a the bank account info he sent over and the account was opened only 2 month ago and had strategically spread out deposits of $2000 in total of $10000 with very few transactons. In addition he provided a credit report with 2 open credit cards but the info is hard to see because it was faxed over.
Everything is pointing to this guy being a fraud.
@Derek Bonanni This is a big screening mishap. Even before you signed the lease you should have seen all of this. Depending on what software you use you can verify SS and DL are valid. Just take this as a Learning experience and get your screening up to A+ I'm putting together a blog for screening and ill make sure to put a section in regards to catching fraudulent tenants and screening foreign nationals.
On your application, is there anything that states that the tenant needs to be in good standing? If so, although you have a signed contract, let him know that you are canceling the contract unless he proves that he is in good standing, which can be defined as having the rent paid with proof of those payments.
If you don't have a statement in which he needs to be in good standing, ask him to sign a paper with that statement and give proof and all will be ok.
If he refuses, document everything, including getting an affidavit from the reference. You will need this evidence should it go to court.
If he cannot prove he is currently in good standing, give him his check back.
On the MEMO of the check, write in "Tenant Agrees to Cancel Lease." If he actually deposits the check, you have at lease some evidence in which you can fight in court that the Tenant was asked to prove he was in good standing as per your application that was signed by the tenant, that the tenant did not show such proof, and lastly, that the tenant agreed to cancel the lease as is evidence from this canceled check's memo which was purposely deposited by the tenant.
I don't know if any of this will work for you, but this is what I would do if I was in your shoes.
Some comments here seem to think you are morally obligated as well as legally. Your tenant is morally obligated to pay their rent. As a landlord, you cannot go on hearsay, you need verification that he is as moral as yourself.
Bottom line is that yes, you are legally bound to your contract. BUT, that being said, if I were you, I would NOT rent to him AND I would try to build enough evidence to reduce the damage as much as possible.
As @Drew Shirley mentioned earlier, then plaintiff can sue for breach of contract, but can only sue for damages.
I am not a Lawyer nor do I have any legal expertise other than being a NYC Landlord and Investor, so take everything I say here in that light.
I know in some courts they can be awarded treble damage. If he can prove he was damaged in the amount of say, $2k, then he can win $6k of damages.
One has to weigh the risks and rewards, of which the rewards would be preventing a bad tenant's occupancy.
Give him his money back, write in "Tenant Agrees to Cancel Lease", let him take you to court, have him prove he was damaged, and make sure you know if the Court will award him with any extra damages.
Weight it all before you decide to accept him without evidence of good standing.
You are the integrityest person I've ever known. God bless you, sir.
If you haven't talked to a lawyer yet, I don't know what you're waiting for. A Lawyer will tell you what the worst case scenario is for breaching this contract. You can then decide if breaching is more financially beneficial than going through an eviction.
If the reference info is fictitious or fraudulent, an attorney can also tell you if you are able to void the contract based on that. The question is, do you have documentation supporting information was given fictitiously or fraudulently?
Everything is pointing to this guy being a fraud.
My original comment was based upon clean screening results, however I see that's not the case. I agree, big time fraudster. Someone who has done this before based upon the depth of his fraud like structuring the bank account transactions. A quick call to a landlord/eviction attorney should get you the answer you need on how you can prevent this move-in. Even if you have to pay for an hour of the attorney's time, it'll be well worth it.
Any chance he gave
You a hot check and is pulling a confidence scam where he has given you a bad check and is hoping you will send him a valid check back to cancel the lease?
Very good point - don't return any funds until they have truly cleared. Ask your bank but I think its like 2-3 weeks. Even then verify the name on the check matches the name on the account and that its really his account.
Shaun, that makes the most sense to me. Ask the tenant to provide proof that the rent was paid. My girlfriend is in underwriting right now, on a new rental, with a lender out of Cali and they asked her for money orders or checks yesterday to show payment on her rental home before she moved in with me. She did not have it (girls..ha ha ...be nice!) So the loan processor is calling the landlord and taking it over the phone for the underwriters. Back to the point, if they paid, there would be ways they could prove it and they will not sue you if you return funds and tell them the truth with the option of producing stubs, document it all with times and dates. You could also ask for additional deposit or last month's rent and that should chase him away.
Give the guy all his money back and say you decided not to rent the unit.
Interesting situation. I agree with @christopherphillips. Don't let him move in! Letting him move in almost guarantees you're going to go to court. Not letting him move in only means there's a chance. And I'd think a Judge would be sympathetic to your situation if he tried to go after you.
Also definitely talk to an attorney. In some states, I think a lease isn't actually considered valid until the tenant moves in, in which case you're good. But that's probably not the law in Cali.
1. Check with an attorney. 2. If they move in serve a Pay rent or Quit the day the rent is due.
Any updates? How did this turn out?
We ended up going with our gut and telling the tenant that we had to cancel their lease due to false information in their application. The potential Tenant was bummed but didn't ask what the false information was and didn't try to straighten it out. We thought that was a sign that he knew what he was doing and we have not heard from him since.