New landlord, problems already, need help!

New landlord, problems already, need help!

CA · Member since 2011 · 39 posts · 5 votes

Hi guys, I’m new here and I hope so much you'll be able to help me.

I got a rental house recently (paid $180K) and hired a property manager, let’s name her K., to manage it. K. runs a small property management company with only one employee – herself. It was a “hand shake” deal, no papers were signed but I have a bunch of e-mails where we discussed our deal. Fees for finding the tenants were supposed to be $400 and monthly property management fee was $85 and I was supposed to get rent from K. on 10-12th each month directly to my bank account.

K. didn’t do a good job in marketing the house but probably it doesn’t matter at this point. She found potential customers – boyfriend and girlfriend and their 2 children moving in together from different households.

We asked $1700 in rent for the house and they met 3 times rent income requirement. Both had poor credit though, with no mortgages/houses ever, he had child support issues and she had a few small bills like smud bill unpaid. Also, there was problem with ex-landlords telephone numbers –they didn’t want to give them out to Ann, then they gave fake/non-working numbers. But supposedly finally they gave “right” numbers and K. verified them and was satisfied with the info.

When it came to moving into the house they couldn’t come up with the money... and K. took $600 non-refundable deposit to hold the house for them. I was not happy with all this at all and I e-mailed K. and let her know I do not think taking deposit was a good idea and that we should rent the house out to the couple – simply because they don’t have the money and they don’t have any source to get the money should they need it. In my opinion they were “screaming” potential problems.

Next thing I learn is K. rented the house to the couple. Several times I asked her to mail/e-mail me the lease agreement and K. says sure and “keeps forgetting” it.

Now it’s mid October and no rent and obviously it’s not coming I have hard time getting hold of K. And when I talked to K. last it was something like they told her they mailed the check, then they "forgot" and would mail it tomorrow and then again tomorrow etc. Since I live 3 minutes away from the house I suggested a few times just to go and get the check, and after that K. told me she would contact tenants and… disappeared.

What I have now is Grand Deed for the house and a bunch of e-mails somehow confirming that K. was (is?) managing it. I do not have tenants names or lease agreement and I’m obviously failing to get it from K. Looks like I can’t even post 3-days late rent notice because I don’t know their names.

My co-workers provided me with landlord attorney’s telephone number but he charges $200 for just consultation and then $700+ for eviction. Shall I go to attorney and pay or shall I try to talk to tenants (I don’t have their numbers but I can go to the house… in hope that they will open the door and talk to me).

Anyway, I would very much appreciate if you could advice what shall I do and thank you so very much in advance!

1Reply
66 views

Most Popular Reply

Real Estate Consultant · Bloomfield, NJ · Member since 2010 · 2k+ posts · 1k+ votes
14y

Remove K IMMEDIATELY from the job via email and certified letter. Send certified letter to tenants letting them know that all communication, monies, etc. should go through you. Continue eviction if you don't receive rent PLUS $500 pet deposit.

Your tenants aren't trained. So you have to get control of the situation, train them and give the tenants the impression that you are strict but fair. Pay or get out. Best done face to face so as to get their respect.

Consult an attorney asap.

See this reply in the discussion

102 Replies

Jump to latestLatest
  • Investor · Las Vegas, NV · Member since 2011 · 92 posts · 25 votes
    14y

    Why can you not deliver a letter in person to the tenants? Why are you so fixated on the certified letter?

    Oh, and K is still blowing smoke. "I did send it, let me rescan it?" What?

    If you had it scanned in and sent, she wouldn't need to rescan. She could forward the email from her sent box. She could reattach the scan in a new email.

    Unless you actually believe she deleted the scanned in file AND went to her sent email and deleted that email. Why would she ever do that?

    It's at the point where you basically shouldn't believe anything she, or the tenants, tell you.

  • Orlando, FL · Member since 2009 · 2k+ posts · 282 votes
    14y

    Tatyana, I agree with what George and the others are saying. If you're going to keep this house as a rental you need to get tough and not rely on people you barely know to do the right thing. The phrase "firm but fair" comes to mind. Get rid of K and follow through the eviction.

  • Real Estate Investor · Baltimore, MD · Member since 2008 · 1k+ posts · 268 votes
    14y

    Would it makes sense to involve an attorney to get the lease (and all related paperwork including proofs of payment) from your friend K? Sounds like she is not really threatened by you, Tatyana. She doesn't seem to take you seriously. It's clear to me she has an attitude "I'll get to you whenever I want and when I do, I will send you whatever I want to send."

  • Investor · Middletown, NJ · Member since 2008 · 2k+ posts · 1k+ votes
    14y

    I'll chime in with the rest - K has failed to follow through with anything and she knows you're easily pacified. Stop contacting her and post the Pay or Quit notice on the tenant's door, have a friend go with you and take a photo of you in front of the door with the notice on it, plus a close up of the notice.

    Follow through with the eviction. You can contact your local court and ask which attorney does the most evictions. You want an attorney who *specializes* in evictions, not one who is an expert at divorce or adoption. My attorney does over 40 evictions a week in my rental city and has it down to a science. I use a different attorney to purchase real estate, as that is *their* specialty.

    If you have time to deal with this mess, you definitely have time to manage your property yourself. You're becoming educated very quickly! A tenant will tell you anything, they'll yes you to death with a smile on their face and then do exactly what they want. Make sure you're in charge from the start with your next tenants.

  • CA · Member since 2011 · 39 posts · 5 votes
    14y

    I'm sorry I'm a newbie and I'm learning (with your help :mrgreen: ) and "certified letter" came from Ibrahim's advice you all seem to agree was right on the money. Nobody said the letter may be not certified...

    Yesterday I talked to a tenant and she told me that she was not giving me any rent but she was giving the cashiers check to K. If today she learns that the game plan has been changed and I changed my mind and decided to fire K... do you think it will all look professional? Or "who cares"?

    There is a very high chance that I'll not be able to give the letter directly to the tenants, due to their jobs they are usually not home in the afternoons. Maybe I'll be able to give it to their 9 y.o. daughter if she opens the door. Or I can post the letter on the door and hope that they will find it - I believe they get home through garage and not the door.

    Will it work?

    I received the rental agreement from K. As for other documents like credit reports, she promised to fax them to me, we'll see.

    I'm e-mailing K. right now that she is no longer PM - you didn't leave me any choise, guys :lol:

    I also think that cash for keys wont' work, unfortunately. But maybe I need to try.

    And I'm going to review the lease and see what is in there.

    THANK YOU SO MUCH!!!!!

  • Investor · Middletown, NJ · Member since 2008 · 2k+ posts · 1k+ votes
    14y

    You're very welcome and good luck! Real quick though, don't give any documentation to a minor child or even have a discussion with them. If the child says her parents aren't home, just leave or post the notice on the door.

  • CA · Member since 2011 · 39 posts · 5 votes
    14y

    Terminated deal with K. via e-mail. Done.

    Here is the letter I'm going to give to the tenants. Could any of you do me and HUGE favor and review it and tell me whether it's o'kay? English is obviously not my native language, so I apologize for any mistakes in advance.

    Date: XXX
    TO:
    XXX
    (property address)

    FROM:
    Tatyana XXX
    Owner of the house (address)
    resides at:
    XXX (my address and phone numbers)

    Dear Tenants,

    This is to notify you that starting October 14th, 2011 K. is no longer a Property Manager of the house you are leasing in according with Rental Agreement of 30th of August, 2011.

    Starting October 14th, 2011 all communication, payments and other issues in regards to the above stated house are going through me.

    If you have any questions or need any additional information please feel free to call me or e-mail me at XXXX.

    Thank you,
    Tatyana XXX

    I do have an eviction attorney recommended by my co-workers, no problems here. But he will only be able to see me in a week, not earlier. So I'll have to survive for a while on my own and not make more mistakes :D

  • Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
    14y

    Who's name is on the lease as the "landlord"? That's who the check should be made out to. If is K, then it makes sense the tenants would give her (only) a check made out to her. I don't think you're going to be able to just take over from her. Rather, she's going to have to notify the tenant that she's out of the picture and the lease is now assigned to you.

    Its unfortunate you can't get any advice from that lawyer, you really need some advices sooner than next week.

  • Orlando, FL · Member since 2009 · 2k+ posts · 282 votes
    14y

    good luck Tatyana. I hope you can get some decent tenants (or sell the place?) once these duds are out of there.

  • Joel OwensBusiness Member
    Moderator
    Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
    14y

    Let me say that buying a house for a rental DOES NOT make sense for everyone.

    Please everyone really think if this is the best course for yourselves.

    I am a broker with knowledge and own many apartment units and it is still not easy even with a live on site property manager and maintenance person to deal with tenants.

    You are not just dealing with collecting a rent check but their lives and drama on a continual basis.

    In your case Tatyana there are many things you could do to generate income without the headache.

    1.Triple net lease from a corporate tenant.You get a 8 to 9% annual return on your money and they take care of taxes,insurance,upkeep etc.

    2.Lend money to a hard money company for great returns

    3.Lend and invest money with someone like Brian's company an equity group.

    4.Invest in REITS.

    There is risk no matter what you do but there are even more ways than above to get the returns you want,work your job,and spend time and provide for your mother without owning a rental.

    I just think from what you have posted there is much better choices you could be making.The 600k equity you speak off is not all available from a bank as they will not cash out equity to 100% of the value.

    You keep wanting to believe in this K person but it is not there.

    You might want to look at selling that property and getting into something else.You need to do the financial planning aspect of it and see if your purchase or way of investing meets your goal and your lifestyle.

    Good Luck

  • Orlando, FL · Member since 2009 · 2k+ posts · 282 votes
    14y

    180K may well be a good deal for a house in most parts of CA (I don't know), but as others have stated it's not a good rental at $1700/month. If you own it free and clear it would give a better return than parking the money in a CD at today's abysmal rates, but that doesn't mean it's the best use of your money. You would take a hit paying the realtor commission fee to sell it, but if you can sell it for not much less than you paid for it it might be worth it to cut your losses at this point and use the money in the lower hassle ventures people have suggested here.

  • CA · Member since 2011 · 39 posts · 5 votes
    14y

    No doubt that I'm not going even to consider selling the house, why? :D It's not just cash right away, it's also long-term investment and passion, I love real estate, I really do :mrgreen: And I was very successfull in RE before - how do you think I got most of cash to buy all these houses? :wink: Yes, another country, but still...

    I'm sorry if I made an impression being weak and soft - I bet my PM and some others had the same impression of me. And when I came to you I was in shock and... I hate to say it but I was lost. Thanks to you I am not lost anymore and in a much better mood.

    And hey, I can be tough and strong, too :D . And I'm sure I'll be able to manage the house,

    As for HELOC, I know very well what is it because I have one already. Treat is as emergency cash.

  • CA · Member since 2011 · 39 posts · 5 votes
    14y

    I'm sorry I have a quick question about credit reports.

    I have credit reports on my both tenants from Experian. Let's say report should have 25 pages (pages go from 1 of 25 etc.), and first let's say 10 pages are collections, then go accounts in good standings, and then I have nothing. Something like page 10 of 25 is the last page.

    My concerns is about eviction history. Will I see it in the reports on the first pages if they have any or not? Is there any other way to find out whether they have evictions or not?

    Thank you and sorry if it's a dum question. I'm just learning.

  • Investor · Cary, NC · Member since 2008 · 78 posts · 14 votes
    14y

    Tatyana:

    You sound like you are scared to make a move. I have been there, and I know (had trouble firing a maintenance crew- what if I cant find anyone else?). The situation you are in now, you need to act fast. Take a day off from work, find an attorney who will talk to you today. You let this drag any more and you will have tenants well settled into your home that no amount of cash-for-keys will get out. Do not agonize about antagonizing any one. The credit report does not sound good. Concentrate on getting these tenants out. Don't dawdle any more. Talk to an attorney, we dont have the full picture to tell you what will work (who is the landlord on the lease and so on). Get a referral to an attorney who will see you today. There are many technicalities of the law involved that you will not be aware of. A good attorney is so worth their fees. Good Luck!

  • Orlando, FL · Member since 2009 · 2k+ posts · 282 votes
    14y
    Originally posted by Tatyana E.:
    I'm sorry I have a quick question about credit reports.

    I have credit reports on my both tenants from Experian. Let's say report should have 25 pages (pages go from 1 of 25 etc.), and first let's say 10 pages are collections, then go accounts in good standings, and then I have nothing. Something like page 10 of 25 is the last page.

    My concerns is about eviction history. Will I see it in the reports on the first pages if they have any or not? Is there any other way to find out whether they have evictions or not?

    Thank you and sorry if it's a dum question. I'm just learning.

    There are no dumb questions....

    Your county should have a free website where you can look up the tenants' civil and criminal records...evictions will be under civil. It will probably ask you for the tenant's birthdate, but you may be able to get the civil data without that (at least that's how it works in my county).

  • Real Estate Investor · Baltimore, MD · Member since 2008 · 1k+ posts · 268 votes
    14y

    You have the SSN and you can order your own credit report (provided you also have the rental application and/or rental agreement indicate that the LL can run credit when necessary). But again, they're already in, you aren't going to evict them if you find out they have a bad credit and a bunch of evictions, right? Although not confirmed, their crappy credit and eviction history is a fact.

    I would also ask K to forward you the tenant's security deposit; make sure you verify the amount with the tenant and ask the tenant for documentation in case of disagreement. Any way they paid K any money - they gotta have a proof of it, especially if they paid with certified check.
    Tell the tenants to have a proof ready before they make any claim regarding past payments.

  • CA · Member since 2011 · 39 posts · 5 votes
    14y

    Thank you so much!

    No, I'm not scary to move at all and sure I'm not scary I won't find other tenants.

    I have all documentation from K. (credit reports, applications, lease agreement etc.), K. faxed the tenants Change of Tenancy notice and as I posted another notice yesterday on their door.

    According to the previous arrangements tenants were going to make payment to K. today. They didn't call me yesterday to make arrangements about payment, and if I don't have the full amount of rent from them today,I'll move forward with eviction process.

    I believe it was Ibraghim's advice "to re-train tenants" and everyone here agreed with it, right? Now I'm following every word of it.

    So if they pay I'll have some time to see what's going on, what I am dealing with, consult attorney, try to communicate to tenants about "cash for key" deals or maybe they'll manage to come up with rent every month, who knows.

    If they don't pay today, I'm putting eviction notice on their door and hire attorney immediately.

    I thought it was your advice, did I miss something?

    I have their deposit $1700 already, name on the lease is K.'s company, situation with money paid is clear, K. is very cooperative at this point.

    If I find out there was eviction on their history I'll immediately request all the money from K. I paid her and then I'll figure out my further actions with her.I was extremely specific about evictions when I hired her, and our communication was by e-mail.

    Another issue. I described situation with their ex-landlords, supposedely in the end they gave their numbers and K. talked to them.

    I looked this up yesterday. Both numbers are way out of area (over 2 hours drive). I looked up owners - names didn't match, and if it was PMs, then "out of area" doesn't work very well.

    I do have owner's numbers but I can't use them because I got them through my job.Can I get them more official way and call them and see what I am dealing with just to be prepared?

    Thank you for all your help!

  • Orlando, FL · Member since 2009 · 2k+ posts · 282 votes
    14y
    Originally posted by Tatyana E.:

    I believe it was Ibraghim's advice "to re-train tenants" and everyone here agreed with it, right? Now I'm following every word of it.

    They may not have the money to afford the place. K may not have screened them properly for income, etc. In that case they can't be retrained--you need to go ahead and begin the eviction process.

    I can't remember if you said the lease named you or K as the person they have the agreement with. If it's K, you may have a bigger problem and it's probably time to contact an experienced lawyer to find out what to do.

  • Real Estate Investor · Baltimore, MD · Member since 2008 · 1k+ posts · 268 votes
    14y

    Pull credit report and check the addresses where they lived in the previous 5 years, and see if these addresses match with what they gave K.
    If names/numbers do not match with what you have from them, they might have pulled an old trick and gave K their friends' numbers. Don't you think friends gave them the best reference?
    If this is the case, you might have hard times getting your $400 from K cause she can say it wasn't her obligation to do background investigation on numbers/names provided by tenants.

    You might want to pull eviction report and save yourself time and not call previous LLs. They might not disclose all the info to you. Not many LLs do. The eviction report will show all you need to know.

  • Investor · Middletown, NJ · Member since 2008 · 2k+ posts · 1k+ votes
    14y

    I doubt your lease says this, but you can add this for future tenants - if any information on the application proves to be fraudulent (if they say they've never been evicted or have a criminal record and you find that they do), that can be grounds for termination.

    When I get an application with landlord names and numbers, I first check the county tax records and see if the landlord name and the property owner names match. They don't always, but it's a good sign if they do. The property could be in a spouse's name only, etc.

    When I call the "landlord", I don't say that Joe Tenant put them down as their landlord. I tell them that they were listed on a rental application, and how do they know Joe Tenant? I learned this from another post on Bigger Pockets. When you ask the "landlord" how they know the tenant, if they're not really the landlord, they may trip themselves up and not remember if they're supposed to be playing the landlord, the employer, or the friend.

    Then ask the landlord if they owned the property the tenant rented from them. If they say yes, but they're not on the tax records, ask why. I caught a recent applicant with this one. Her previous "landlord" was actually a relative who couldn't explain why someone else's name was on the tax records when he said it was his property. Next!

  • CA · Member since 2011 · 39 posts · 5 votes
    14y

    I took your advice (thank you!) and looked up eviction history. 3 cases, 2008, 2009 and recent 2011.

    Called the attorney my co-workers highly recommended and tried to move my appointment with him to an earlier date. He is all booked but his assistant promised to call me at once if he has a cancellation. I told her it was urgent.

    None of the co-workers who worked with this attorney are in the office today.

    I e-mailed K. with information. When I was hiring her I made myself very clear that I pay her $400 for proper screening of tenants and that evictions is my very special concern, and this is no.1,2 and 10 reason I was hiring her.

    I paid her $400 for screening and processing only, I marketed house myself - pictures, text etc., and I paid for this out of pocket.

    So I sent her an e-mail with cases #s and told her that if I was her I would immediately transferred back the money she got from me.

    I really didn't think everything was that bad.

    Looks like being a landlord is not as much fun as I expected

  • Rental Property Investor · Taylor Mill, KY · Member since 2011 · 105 posts · 24 votes
    14y

    Wow Tatyana, you got the worst end of every deal on this! I hope you can get all of this ironed out and are able to turn this into a positive.

  • Investor · Middletown, NJ · Member since 2008 · 2k+ posts · 1k+ votes
    14y

    Hi Tatyana,

    Being a landlord isn't exactly fun, but at least you're working for youself! And when your tenants pay and don't give you grief, it's a good gig. It only takes one bad tenant to make your life hell though, and right now you've only got one. The odds are that most tenants want a decent, peaceful place to live and won't thrive on drama. Hang in there.

  • CA · Member since 2011 · 39 posts · 5 votes
    14y
    Originally posted by Aly L:
    Being a landlord isn't exactly fun

    The more I'm involved the more *fun* I have lately :lol:

    I searched a bit deeper, and she has 4 (!) evictions in just past 3 years, and also a civil case, and had *only* 3 evictions and 1 civil case.

    And it's not that I'm a newbie and made a mistake - no, I paid to a professional to do the the job, so those tenants were not free for me by any means :lol:

  • Orlando, FL · Member since 2009 · 2k+ posts · 282 votes
    14y

    I hope K refunds your $400 -- you certainly deserve it back at this point. If she doesn't, I'm not sure whether it's enough money to make it worthwhile pursuing in court. It sounds like you've got "professional tenants" on your hands and getting rid of them will be your main priority.

Join the conversationCreate a free account to reply, vote on answers and follow this thread.