About to close on a duplex with tenants who are being evicted.

About to close on a duplex with tenants who are being evicted.

Austin, TX · Member since 2011 · 9 posts · 0 votes

I'm waiting on a return call from an attorney, but I wanted to see if there were any quick opinions/thoughts on this: My wife and I are buying a duplex, and the existing tenants are 3 months behind. The current property manager told us they were being evicted and would be out by the time we closed (Wednesday). Now, it doesn't look that way.

We had a provision in our contract that states it would "be vacant or proof of eviction proceedings shall be provided"... and so far, all we got was a letter the manager sent, telling them to vacate the premises. And in the email, he said we could files with the court whenever we wanted. Eventhough he told us before that HE was going to file. I just don't know if that one letter constitutes "proof of eviction proceedings" or not.

The problem is, I think the tenants are waiting for us to get the house, hoping they can "reset" the deal, so to speak.

So how would you handle this? When we put the contract in, we were thinking we'd get a vacant duplex to fix up, live in one side, and eventually rent out the other side to tenants of our choosing. Now, we're faced with the hassle of evicting previous tenants. And I assume there are fees we'd have to pay with filing the paperwork, and eventually having to physically remove them from the premises.

And with their deposit, does that go to US... or do the sellers keep it, since they haven't gotten the rent? (we're in Texas... if that matters)

Thanks!

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

Don't close until its empty.

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  • Austin, TX · Member since 2011 · 9 posts · 0 votes
    14y

    I'd also like to point out, we've never received the original lease agreement. Is that required, or does it need to explicitly stated in the contract?

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

    Don't close until its empty.

  • Curt DavisBusiness Member
    Flipper/Rehabber · Memphis, TN · Member since 2008 · 5k+ posts · 2k+ votes
    14y

    Exactly what Jon said. Even if it means loosing the deal, its not worth it. Unless you get some type of agreement from the sellers I would hold off.

    Curt Davis - KAIZEN Realty538 Reviews
  • Investor · Cincinnati, OH · Member since 2010 · 1k+ posts · 928 votes
    14y

    You shouldn't specify "or eviction proceeding started..." in the contract, the place needs to be empty and verified through inspection to be subantially in the same condition as when you signed the contract. These disgruntled tenants could destroy your place when they find out you're not stupid enough to just give them a "reset". Once a deadbeat...

  • Austin, TX · Member since 2011 · 9 posts · 0 votes
    14y

    Thanks everyone!
    Our agent put in the "proof of eviction proceeding" because he said something about not being able to force the seller to evict the tenants, or something.

    And to be honest, the tenants are a very nice family, so I don't think they'll trash the place. They just got in over their head. I just really don't want our first experience as landlords to be filing eviction papers with the court... especially when we were under the impression the sellers were going to do that. We're actually looking for ways to back out of the deal... especially since the sellers have dragged their feet on a LOT of things, like getting us the disclosure, and signing/initialing certain documents.

  • Austin, TX · Member since 2011 · 9 posts · 0 votes
    14y

    Now I'm wondering, and Google isn't helping, if they DO pay the back rent after/if we close... do WE get the rent?

  • Lender · Fort Pierce, FL · Member since 2009 · 825 posts · 486 votes
    14y

    This is a nightmare 7 days (or 9 days) after Halloween.

    At the very least, it is a headache for you already and you have not even taken possession.

    As other suggest, do not close until it is in the condition that you contracted for ... EMPTY.

    At the very least, the ill will that these tenants will have will not be directed at you until you are the owner. If you let them stay, they will give you the exact same sob stories they gave the current owner (the seller).

    Why buy headaches?

  • Investor · Southern CT, CT · Member since 2010 · 211 posts · 41 votes
    14y

    Goes to prove to you that some agents really don't know anything about sound investment principles. That clause of "eviction process has begun..." may bite you in the rear. You never take possession of a rental property with bad tenants in it. your 'CYA" is to ask that it be 100% vacated and your do a property condition walkthrough X amount of days prior to close to make sure everything is as it was when the contract was signed. You should also ask that locks be changed once the tenants vacate. You can never be too cautious in such scenarios. It could be a costly mistake both emotionally and financially.

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

    Terry I don't know your contract or your agent but based on what you have posted they are not a very skilled agent and missed many protections on your behalf.

    It sounds like to me based on the verbage the sellers have not started eviction AT ALL.The simply sent an e-mail or some other junk asking the tenants to leave.

    You will have to go when you buy and do the whole process.Generally this time of year the court system takes off about a month between Thanksgiving and New years with various days off.

    This causes a backlog of eviction hearings and writs being executed once a judgement is in your favor.You might not get these people out until January or February depending on the back log of evictions taking place.

    I would find a contingency to terminate the agreement on and then go under contract under different terms and protections.If you are not satisfied with the agent and their mistakes you need to talk to the head broker and demand help.

    I spent about 45 minutes on the phone today helping one of my agents review an offer for their buyer and the agent missed about 15 different tips and tricks because they did not have the experience I do so I helped them out.

    Just because it is a family and they seem nice doesn't mean they won't trash the place.I have seen people go from nice to crazy in a split second.

    Until that place is empty and the locks are changed and you know what condition you are buying in I wouldn't touch it.

    No legal advice.

  • Syracuse, NY · Member since 2011 · 53 posts · 47 votes
    14y

    I agree with Joel on this. As a property manager, I've seen "nice" people do some not nice things when they realize the BS isn't working and they are really getting evicted.

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

    I also agree with Joel. Never assume anything because someone "seems nice". Until you've gotten to know them over a period of months (at a minimum), you can't be sure what they will do.

  • Austin, TX · Member since 2011 · 9 posts · 0 votes
    14y

    Thanks again for the advice.
    They had technically started eviction proceedings, since the first step is hand-delivering a Notice To Vacate. But they never went beyond that.

    To update: I called the Title Company lawyer, just to assess my options. While he wasn't able to help much, since he's not able to be my representative, I guess he did put the screws on the Seller's agent since I implied that I was looking for ways to break the contract. The agent ended up paying for a truck and got the tenants to move that night. Besides some trash left behind, there really wasn't any damage... so we caught a break.

    Now we're waiting for the seller to sign the closing papers and wire their closing costs. If THAT doesn't happen by midnight, they'll be in breach of contract... and I get to call another lawyer tomorrow. Fun.

    I may not be cut out for the real estate investment business.

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