How to handle tenants living for free?

Question

For three months now, tenants are saying they cant pay rent due to being laid off from their jobs and they are barely surviving. They said they have sought help from their church but they only received assistance to pay their electricity and water. I couldn’t call them bcoz they said they cut their phone, so i came by for a visit. The fiance promised to send in some rent by end of the week but didn’t follow through. I sent 2 requests for payment through cash app (that’s how they sent payment before) but no response. The fiancé said they are not trying to ride the “cares act”. The lady tenant was not home when i came by in the morning and he said she’s in another town.... I smell something fishy. I think she has a job. Any advise on how to get rent from these people? I have digging from my reserves to pay mortgage and I am about to run out of it. Thank you in advanced for your valuable insight.

Tracy Streich · Answer

This is a tough one right now.   You cannot evict for non payment of rent but you can for other lease violations.   Are there any other rules they are breaking in your lease?  Get with your eviction attorney and find out how the local courts are handling it and be ready Jan 1 to start eviction.   Don't wait for them to extend it again!

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L. Pritchard · Answer

The CDC Moratorium isn’t state specific and you are correct that as of now it will end 12/31/2020. Tenants must sign off on it and return it to their landlords for it to apply.

Joy you are going to have a very tough road ahead of you if you can’t evict a tenant. I can sympathize with your feelings and values but you are a landlord and expenses are real. You will need to be firm and do the tough things like evicting tenants with kids and sad stories.
I hope that doesn’t sound too harsh but it is a reality of the business.
I’ve probably had to do over 100 evictions in my career and while it does get easier there are still sometimes that it breaks your heart.

Joy James · Answer

UPDATE: Thank you all for your advise and constructive criticism....Since the Rent Moratorium has been lifted here in GA and the county where my property is located did not choose to extend, I filed for eviction last Wednesday. I consulted with a lawyer. So I am waiting for her to respond in 7 days (pay what she owes) or wait 14 days for a court date. I am hoping that this issue can be settled ASAP.

Happy 2021 everyone!

Dennis Wayne · Answer

@Joy James

Core values in any business are to make profit for you and your share holders , if you are running a charity then that’s different . These types of people love hobby landlords like you I bet ! Do you have any other units vacant open now ? I’d love to come over and live for free on your dime myself

Kyle J. · Answer

I’ve never actually heard a landlord say that. But if it’s your “core values” that prevent you from evicting someone who needs a place to stay, why didn’t you just say that to begin with? The CDC order or any other eviction moratorium has nothing to do with this then. It’s your “core values” preventing the eviction.

These tenants are not going to catch up on the rent. They’re too far behind and apparently not motivated to pay.

I guess just continue to let them live there for free.

Kelsey Folger · Answer

@Joy James just an idea, but I would maybe see if they’d be ok if you contacted someone at their church. If they really are struggling, maybe talking to someone at their church would help in trying to get additional assistance and cutting out the middle man (them). Just an idea.

L. Pritchard · Answer

@Joy James I see. Ok. If they haven’t provided you the signed CDC form then I would send out your payment demand notice now. For us here it is a 5day notice but it actually allows them 30 days to move if they can’t pay. So, we cant actually file for eviction until after 30 days. We also expect that there are a large amount of cases that will be filled at the start of the year and this will further delay getting a court case and a lock out. Sending the notice doesn’t mean you actually have to go that route either. But it will put some fire under the tenants to pay you. Also, if you haven’t already looked up you local rental assistance agencies I would suggest doing that and letting your tenants know they might be able to get help. Best of luck to you either way  🙂

Joy James · Answer

@L. Pritchard, I have evicted 2 tenants in the past for default in payments. I inherited  them from previous landlord and it was just an awful situation.

I know how to evict tenants, it’s pretty self explanatory. But with the moratorium, I am not sure when to start the process... now or wait until after dec 31? Thanks for your advise!

Joy James · Answer

@Kyle J.

Thanks for your insight. In the state of Georgia, I found that rent moratorium expires on December 31,2020 unless it gets extended. I have spoken to tenants and they said they can’t stay afloat due to unemployment...

Its against my core values to evict people who need a roof over their head when they are already struggling just to put food on the table. Plus they have kids. So I asked them for a letter that provides detailed information on the dates that they lost their jobs. So far, no luck getting that letter yet.

Kyle J. · Answer

@Joy James  I'm confused on why you're allowing them to live in your house rent-free month after month?  It'd be one thing if you could afford it, but you said you're draining your own reserves to do this.  What is the reason?

Is there an eviction moratorium in your state that's preventing you from taking action?  I tried Googling eviction moratorium in your listed state (Georgia), but couldn't find anything.  (Maybe I missed it.)

The tenants obviously don't know what they're talking about if they're hinting at the "Cares Act".  That already expired.

The only other thing out there that I'm aware of is the CDC Order, which does have eviction protections.  However, it only applies under certain circumstances and even then ONLY if the tenant submits a signed declaration to you under penalty of perjury (which I'm guessing they haven't done since it doesn't sound like they even know about it).  Furthermore, you're not even required to notify them about the order/declaration form.

So...why have you chosen not to pursue eviction against these non-paying tenants all these months?  At this point, honestly it sounds like they're just not motivated to pay anything because you haven't done anything to motivate them.

I hope this situation works out for you, but I think you're going to have to take some action in order for it to.  Sounds like they're just taking advantage of you at this point.

How to handle tenants living for free?

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