Investor · Champaign, IL · Member since 2020 · 8 posts · 3 votes
Need suggestions on ways to handle this tenant. I knew she would be a headache when I was in the process of buying this set of homes, but the deal was just too good to pass up. I followed procedure and gave her a 30 day notice in regards to a rent hike etc. Closed on the home in November, gave her notices right after, left everything the same for December and we are now in January which is when all changes are supposed to take effect and she is yet to sign the new lease etc. She did pay the old rent amount for December but I am yet to hear a peep out of her this month. Some more facts; she was on a month to month lease with the old owners and the last lease she signed was from 2017, she uses the home for airbnb and is pretty good at it based on her host ratings. The eviction moratorium has my hands tied. What to do?!!!
Rental Property Investor · Champaign, IL · Member since 2015 · 146 posts · 80 votes
5y
(Not a lawyer, opinion here) So is she AirBnBing the whole place, or is she living there and just doing a room? That would make a difference in how you handle this. In any case I would do the following:
Screenshot her AirBnB listing of your place just so you have some records that is going on. Most leases include a prohibition on running a business out of a rental, but I assume you've already looked at the old lease. You'll also want to explicitly cover that in your lease template, so you'll need to work with your lawyer.
Read the eviction moratorium and contact a lawyer. The December renewal actually isn't that restrictive and if the tenant didn't come with a Declaration that they are a covered person (which would have come from the prior owner) then they may not be protected. Sounds like this is a situation where they just don't want to pay, not that they can't because of covid. Just being stubborn isn't covered by the moratorium. The lawyer would be able to tell you what the local steps are (including steps short of eviction in order to encourage a new lease signing).
Don't accept rent for January for the old amount before talking to your lawyer! You might inadvertently create a month-to-month tenancy under the old terms.
Realtor · PInellas County Largo, FL · Member since 2016 · 902 posts · 810 votes
5y
I am not a lawyer. This is not legal advice.
Have you discussed what she wants to do? If someone is subletting as a business, there should probably be a master lease in place for a longer term than MTM that includes all of the insurance that they will carry, maintenance that they will perform, responsibilities they have for their tenants, etc. It should look more like a commercial lease than a residential.
Plan this ahead of time:
You should have a business conversation with her about your desires, her options and ability to negotiate, and your courses of action depending on what she chooses to do moving forward. If it were me, it would be along the lines of,
"this is the new lease, this is the new rent, etc. If you choose not to accept these terms, the state allows me to give you 15 days notice to cancel your current MTM lease. In the light of decency, and the current market, I will give you to the end of, say, February. This is a big notice, so I don't need you to decide right now. The new lease and terms will take effect at the beginning of next month, after 15 days notice, so you have until Friday to decide either way. I will have a notice of non-renewal or the new lease for you to sign then."
If you want her out, you start with a notice of non-renewal. You don't threaten or mention eviction. It shouldn't have to apply if this is approached correctly. It sounds like she is taking good care of the place, so I would let her know that she can have her full deposit back as soon as she signs over the property and gives up all rights to it.
An eviction should only happen if she goes all rogue and becomes a holdover tenant, which most sane business people do not do.
Real Estate Broker · Tulsa- OKC Oklahoma · Member since 2017 · 868 posts · 801 votes
5y
@Umaha Essien You likely do not have the right insurance in place for the home to be used as an Airbnb as well. Move forward with the eviction. She is paying and the issue is not Covid related Especially since the home is used as Airbnb
Rental Property Investor · Champaign, IL · Member since 2015 · 146 posts · 80 votes
5y
(Not a lawyer, opinion here) So is she AirBnBing the whole place, or is she living there and just doing a room? That would make a difference in how you handle this. In any case I would do the following:
Screenshot her AirBnB listing of your place just so you have some records that is going on. Most leases include a prohibition on running a business out of a rental, but I assume you've already looked at the old lease. You'll also want to explicitly cover that in your lease template, so you'll need to work with your lawyer.
Read the eviction moratorium and contact a lawyer. The December renewal actually isn't that restrictive and if the tenant didn't come with a Declaration that they are a covered person (which would have come from the prior owner) then they may not be protected. Sounds like this is a situation where they just don't want to pay, not that they can't because of covid. Just being stubborn isn't covered by the moratorium. The lawyer would be able to tell you what the local steps are (including steps short of eviction in order to encourage a new lease signing).
Don't accept rent for January for the old amount before talking to your lawyer! You might inadvertently create a month-to-month tenancy under the old terms.