I recently purchased a 2 unit MFR in NJ. My first MF purchase; and hopefully, not my last. My family lives in 1 unit, and I have rented out Unit 2 to a family that gets SSDI, plus rental assistance from an agency called Alternative.

Long story short, tenants pay for their utilities, and are on a M2M lease.  I have a separate meter for electric & gas, and the water is divided based on percentage.  Usually I would provide a copy of the water bill, with explanation of the breakdown of the costs.

The last 2 months they have elected not to pay the water bill. 

My lease states that the tenant is responsible for those utilities, but I do not have any wording that states unpaid utility can be treated as unpaid rent.

Additionally, I've had some issues with the tenants.  Generally it's due to the loud bass coming from their car stereo system.  The most recent was when a verbal altercation occurred with my wife.  My wife usually stays out of the matter, but she lost her cool.....

Just before Thanksgiving, I gave the tenants a 30 Day Notice of Non-Renewal.  Their agency, Alternative, asked for an extension to mid-January or later because they have located a new apartment for the tenants, but it will not be ready till Feb 1st.  Originally, I gave them to Jan 5.  The case worker informed me that regardless of the 30 day notice, I still have to file eviction. 

I am aware of this, but due to the most recent altercations I decided to accept the tenants till Jan 31.  The Case Manager (to make the peace) also added additions such as their car is not allowed on the premises and the tenants must be respectful of inside noise after 10pm.  The case manager and I came to a verbal agreement, and I wrote an email to her and her manager confirming the agreement.  I am in process of waiting for it to come in writing.

Additionally, one of their kids damaged my garage.  The damage was minor and only $150 to repair.  The kid has a part time evening job and he pays me about $20 every 2 weeks.  He still owes me $100, and hasn't paid me the last 4 weeks.  The tenants also owe me $150 in back pay for a non-refundable pet deposit.  They have paid $250 of the $400 that I charged. 

My concern is, I have zero faith the tenants will move out on Jan 31. Should I proceed to start an eviction process based on the fact that the tenants are in violation of breaking the lease, which is they haven't paid their water bill and take out the rest of the money owed from the security deposit? or is there something else I should be doing. 

@Danny Minhas Greetings and welcome to BP!

I would say start the eviction process now. If they are out by the end of the month, no harm, no foul. If they are not, and you have not started the eviction process you are now 30+ days behind.

I wish you the best! Peace!

Danny,

Can the case worker assure that they have another rental, have signed a new lease and that will vacate on or before Jan 31st?

If not, I would file for eviction 

The utilities, is something I always put in my leases and they are infact included with the basic rents.  Any amount not paid will be assessed a late fee and the late fees are also spelled out in my lease.  I do not know that you can use this as grounds to evict if you were not clear.  That being said, they are on a month to month so how about you just not renew?  Give them a 30 day notice of non-renewal and call it good.  If they try to fight you start eviction proceedings and just do not collect any rents from them and do not (including your wife) engage them.  Tenants can try to push your buttons and you will need to be extremely careful when dealing with them once an eviction process has been initiated.  As far as deduction from security deposit, that is something I suppose you could do.  On the next lease, be sure to include utilities as part of rent and do not collect separately, I collect under one ledger and my payments are made online which also makes it easier for me to stop receipt of rents should I start eviction process.

Personally, I would never want to share a residence with people that can't foot the bill themselves. The area you are in might warrant it, but if you can; I would try and rent the unit to someone that can pay rent on their own and you might (and probably) will avoid situations like this in the future.

All valid and good points.  Thank you friends.

I will be looking to reach out to a lawyer to begin eviction process as a backup. 

Additionally I will update the Master Document of the Lease to include unpaid utilities is equivalent to unpaid rent. 

Can't thank you all enough.