California call for class action lawsuit on Eviction Moratorium

California call for class action lawsuit on Eviction Moratorium

Newport Coast, CA · Member since 2014 · 95 posts · 73 votes

So I owe two homes that I'm renting out, one tenant is paying just fine but the other tenant owes me two months of non-payment and are not paying since she's been unemployed. If she applies for unemployment, she'd be getting about $4,000 a month in California, which is more than enough for the rent payment. But she isn't cooperating and I believe is abusing the system.

I wonder, what is better to do? With California's judicial council law, you have to wait another 90 days after the governor lifts the eviction moratorium (that means July 28, 2020 plus 90 days afterwards so we are looking at October 28, 2020). That's a potential of 5 - 6 months where the tenant doesn't have to pay me a single dime and will be squatting in my house for free. Not to mention any damages to the property I will have to suffer as well. And it could get extended to 2021.

What's the chance of me getting the rent back-pay owned to me? The tenant can simply delay and move out or get evicted in November and it could end up in small claims court if I want to get any money back or a collection agency will have to go after the tenant (and the collection agency gets 40% of anything they can collect on). 

Should I gamble on this or look into how to file a class action lawsuit against the State of California and the Judicial Council?

Any other people in California having these issues and would like to get together to file a Class Action Lawsuit or offer suggestions on joining local Landlord associations who are already looking to do so? Strength in numbers is the way to do anything about this. 

Do other landlords have problem tenants that are not paying as well?

Let me know your thoughts.

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Investor · wilmington, NC · Member since 2012 · 3 posts · 28 votes
6y

Absolutely you need to sue them. I own several hundred rental units in other states, otherwise I'd join you in helping cover the costs. California needs businesses to start putting a lot of pressure on it. The good news is that most of the businesses are moving to Texas which is the biggest hurt that they can put on the state. Without businesses it loses its revenue and becomes a trash heap. Sue them. They are violating your constitutional rights and probably violating the takings clause. They are usurping your property for the benefit of the public. They must reimburse you for taking your private property and using it. Start reaching out to landlords, you can get all their contact info using reonomy which only cost about $100 per month to get direct owner contact points. Get a handful together to start, so you have some cash to initiate the class action. If we can get more landlords across the country to take action we have the possibility of 30 million housing units suing the federal and state governments! Federal Cares act alone is causing over 5 billion in damages for it's moratoriums imposed on landlords.

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  • Realtor · Oakland, CA and a Real Estate Investor with Multi-Family Units and a Self Storage Facility · Member since 2016 · 2k+ posts · 2k+ votes
    6y

    @Debbie Farmer   Yep, screen screen, screen.  I advertised on Go Section8 a few months back and on CL for a tenant. It was a rare instance when a Section 8 tenant moved out of one of my rentals in Oakland. Interestingly she called back about a month ago asking if she could move back in to the vacant unit if it was available since things weren't working out with where she moved to. I had to tell her that the unit she moved out of was filled with another Section 8 tenant less than a month after she moved out.

  • Rental Property Investor · Blackhawk, CA · Member since 2012 · 46 posts · 14 votes
    6y

    Yep I advertise on Gosection8 and CL, too.  But this month I just used Gosection8 for two vacancies since I only wanted section 8 tenants.   I had over 50 responses and 20 applications.   One more vacancy to go next month and hopefully everyone will stay put for a while. (except for the deadbeats of course) 

  • Rental Property Investor · San Diego, CA · Member since 2014 · 1k+ posts · 2k+ votes
    6y

    I can attest with my buddy @Brian Garlington I have found recently that my best properties are the ones with 50% section 8.  At this time I really like the guaranteed money!! 

    Swanny

  • Rental Property Investor · Lancaster, CA · Member since 2015 · 103 posts · 55 votes
    6y

    @Brian Garlington  Appreciate your information on Section 8, very informative. 

  • The Plaza · Member since 2014 · 15 posts · 14 votes
    6y

    I am an advocate for Section 8.  For some properties it does not work because Section 8 will only pay a certain amount.  Otherwise it is a good option.  

  • The Plaza · Member since 2014 · 15 posts · 14 votes
    6y
    I hope more lawsuits will be filed.  I think rental property is being taken without compensation because by-in-large the real estate community is not putting up a fight.  Other industries are getting billions and the government has not even implemented polices that amount to theft of their property.  I write and call my local and state political representatives weekly about this.
  • Member since 2018 · 51 posts · 10 votes
    6y

    does anyone know if they also extended the forbearance too? it seems like they would go hand in hand here but I cant find any info on the subject. Im really at a loss for word on how this situation is unfolding. 

  • LakeWood , CA · Member since 2018 · 268 posts · 331 votes
    6y

    @Heather Collins trump did say he was going to help tenants,landlords and homeowners but I don’t think he clarified on to how and when to do it. 

  • The Plaza · Member since 2014 · 15 posts · 14 votes
    6y

    Below is information on what Trump order does. 

    Trump has said many times in recent days he wants to prevent evictions, but his latest executive order does not ban evictions. Instead, Trump calls for Health and Human Services Secretary Alex Azar and Centers for Disease Control and Prevention Director Robert Redfield to “consider” whether an eviction ban is needed.

    A federal eviction moratorium has ended. Here’s what renters should know.

    Trump also didn’t provide any more money to help renters. The executive order calls only for Treasury Secretary Steven Mnuchin and Housing and Urban Development Secretary Ben Carson to see if they can find any more funds to help out. It doesn’t promise more aid.

  • The Plaza · Member since 2014 · 15 posts · 14 votes
    6y

    To me forbearance is poor consolation for what is essential government take over of private property.  If the government is going to say tenants cannot be evicted, which is essentially the same as you do not have to pay rent, the government should provide funding to pay the rent.  Forbearance just delays the mortgage payments for missed rent property owners will likely never receive from tenants.  If you have multifamily commercial loans, you will likely have to repay the loan in the near future instead of having the payments applied to the end of the loan.  I also read forbearance negatively affects your ability to buy more property.  

  • Rental Property Investor · Dallas, TX · Member since 2019 · 88 posts · 55 votes
    6y

    @Dan Heuschele I'm glad you're happy in California. Please tell your friends to stop coming to Texas! We're full! 🤣🤣

  • San Antonio, TX · Member since 2019 · 930 posts · 836 votes
    6y

    @Albert Hall

    Everyone is talking about how section 8 is recession proof, but presumably HUD can't print their own money. Can section 8 run out of funds in one location?

  • The Plaza · Member since 2014 · 15 posts · 14 votes
    6y
    I would put not getting paid though Section 8 under "anything is possible, but highly unlikely".  Housing agencies have an annual budget and issue vouchers based on that budget.  Where I live there are many benefits to the voucher program in addition to guaranteed payments. 
  • Member since 2018 · 13 posts · 8 votes
    6y
    Originally posted by @Ama Ols:

    We have about 5 percent of tenants who had valid covid issues. But now 50% are not paying. Have many accounts with 5-8k owed now. $200,000 of rent not paid over the last 4 months. Why pay rent when your landlord gives you free housing, free maintenance team, free mortgage, free electricity, free water, free trash? 90% of these tenants are scammers. Housing is apparently a human right that's owed from the owner to the renter. Why can't I go into whole foods and steal their food without getting the police called on me? I guess food isn't a human right... What a ****ing joke. They better supply a massive amount of federal bailout funds to landlords after Trump's little act today, which  he used to buy the voting base.

    Totally agree. I'm a small landlord with one tenant (I have two tenants total) in San Bernardino County who stopped paying rent since June 2020, making different claims--work hours reduced and that he's "having difficult times because his coworker died from COVID". I asked him for proof of financial hardship as required by law and he has not provided any. Aside from a couple texts and emails, my tenant has ignored all attempts at communication even though I offered to work out a rent deferral or reduction plan at the beginning of the pandemic if needed. Such BS. 

    It is the laziest governing I've ever seen to just issue a blanket moratorium on evictions. Is it so difficult to still allow courts to process evictions to evict non-paying tenants who aren't showing proof of financial hardship and are obviously trying to take advantage of the system? If I don't have money to pay for food because of COVID, why can't I just go into a restaurant, order food, leave, and then have one year to pay them back? Boggles my mind that politicians are focused on this myth that the real estate market is a fight between rich corporate landlords vs poor minority tenants. 

    Anyway, I've set aside one year of expense for that rental property to be conservative, but debating whether to take mortgage forbearance or deferral in a few months if it seems that there is no end in sight for the moratorium. Still waiting to hear more on how mortgage forbearance really affects people's credit scores and ability to obtain financing in the future. I've already planned to sell my rental property once I can get my tenant to vacate. I was told that if you take forbearance and then pay that amount back or sell the property and pay off the loan, then it may not affect your ability to obtain future financing as much or at all... Does anyone know how lenders will view that situation? 

  • Member since 2020 · 4 posts · 0 votes
    6y

    Hi Anne, I have only one guest house that I just had built on to my house and my Tenant is doing the same thing, meanwhile she has brand new furniture and parties. I was under the impression that the Government moratorium was for federally backed mortgages. My loan is not and I have a construction loan, although I am i Los Angeles County and we have it until September 30th. This is so infuriating, they encourage homeowners to build ADU's so I did now , it's not really mine. !!

  • LakeWood , CA · Member since 2018 · 268 posts · 331 votes
    6y

    @David To I think the judicial council will end their moratorium on evictions on the 1st of September. Have you thought about what your next move might be?

  • Newport Coast, CA · Member since 2014 · 95 posts · 73 votes
    6y

    My property manager has already had her eviction attorney serve the tenant and the tenant's attorney 60 day notice (August and September) so hopefully, it will proceed to the courts in October. 

  • Member since 2018 · 13 posts · 8 votes
    6y
    Originally posted by @Ginger Harrison:

    Hi Anne, I have only one guest house that I just had built on to my house and my Tenant is doing the same thing, meanwhile she has brand new furniture and parties. I was under the impression that the Government moratorium was for federally backed mortgages. My loan is not and I have a construction loan, although I am i Los Angeles County and we have it until September 30th. This is so infuriating, they encourage homeowners to build ADU's so I did now , it's not really mine. !!

     That's terrible! Sorry to hear that. Must be awkward too since you have to live with your tenant on the same property. Really counter-intuitive for the CA government to encourage building ADUs to increase the housing supply, and then take away your right to that property.

  • Member since 2018 · 13 posts · 8 votes
    6y
    Originally posted by @David To:

    My property manager has already had her eviction attorney serve the tenant and the tenant's attorney 60 day notice (August and September) so hopefully, it will proceed to the courts in October. 

    I served my tenant a 60-day notice in June and today is the day that my tenant is supposed to move out (which he obviously is not). The lawyer who served the 60-day notice said that if the tenant does not move out, I can have the eviction filed and stamped in court and wait until I can proceed in court (similar to what you are doing). But then spoke with another lawyer who recommended that I NOT proceed with eviction if my tenant does not move out at the end of the 60 days because the 60 day notice is ineffective. I think it's because of the city ordinance that states that landlords who know that tenants cannot pay due to COVID cannot serve a notice of termination--and this is a gray area because my tenant has claimed that he can't pay due to COVID but never provided documentation. I'm technically not in violation of any law or ordinance by sending the 60-day notice because my tenant has not fulfilled his obligation to pay rent or provided formal notice and documentation, but second lawyer said he wouldn't proceed with eviction. My tenant then emailed me yesterday saying that he spoke with housing and said that because I'm trying to circumvent the eviction moratorium by using a 60-day termination notice, what I'm doing is illegal. 

    Based on what the second lawyer said, I've ultimately decided to not pursue eviction at this point, but curious as to what your property manager's eviction attorney said. Hope your eviction proceeds through court. That would be a big win for all of us here.

  • Newport Coast, CA · Member since 2014 · 95 posts · 73 votes
    6y

    The eviction moratorium is supposed to end on September 30 or so. So yes, you have to wait until the eviction moratorium ends before your eviction case can be processed. You can still file it in advance and it will be placed in the queue. But right now, you cannot evict him until after September. Hopefully, it won't get extended again.

  • Justin R.Pro Member
    Rental Property Investor · San Anselmo · Member since 2015 · 659 posts · 600 votes
    6y

    @Royce Kemp

    Man sorry you had to deal with this. This is the stereotypical CA worst case scenario explained. You know you can't, but I'm sure you have thought about taking justice into your own hands. It would be tough to restrain yourself from physically moving them out of your house.

    I wish you the best!

  • San Diego, CA · Member since 2013 · 4 posts · 21 votes
    6y

    @Justin R.   Thanks. I contemplated it. But I them looked into what laws I would be violating and it would be a felony to try and forcibly remove someone from their home.

    September will be month 10 with no rent. I'm approaching $20K in lost income.

    I do plan to sue something when this ends. I have a Writ of Execution. There is only one thing in my way...the Sheriff doing their job. The notices were posted, the stays had been denied, I was 2 days away of putting what was already a BS nightmare behind me, when the  Governors order came down.  

  • LakeWood , CA · Member since 2018 · 268 posts · 331 votes
    6y

    @Royce Kemp I’m surprised you still haven’t been able to continue With your lock out. That’s insane. I don’t think it ends here im sure this tenant protection will last well through 2021. 20k down the rabbit hole. Bummer. I have a feeling that tons of landlords will be in the whole in the next couple of months. 

    @David To on the bright side the judicial council voted to remove their eviction moratorium and it ends on September 1st

  • LakeWood , CA · Member since 2018 · 268 posts · 331 votes
    6y

    @Royce Kemp how’s your case going? Any good news? Is ab1436 going to affect you? 

  • Member since 2018 · 13 posts · 8 votes
    6y

    Seems like AB 1436 is on its way to passing. Such a ridiculously one-sided crap bill. I never used Twitter before but just started an account so that I can comment on Assemblyman David Chiu's and other's posts on the eviction moratorium and speak up on my struggles as a small landlord.

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