Your opinion on "do nothing" strategy (in Philadelphia) when tena

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Your opinion on "do nothing" strategy (in Philadelphia) when tenant doesn’t pay utilities

I have lease that tenant has to pay utilities (although they are listed on our name). The tenant has not left out at end of lease and doesn’t pay any utility. I want to run in "do nothing" strategy in that I will not tell companies to shut off but I will not pay tenants bills. The rule that forces landlord to pay utilities for not paying tenant is rude and is actually making authorities to support delinquent behavior. In my case with the facts:

  1. Tenant is responsible for utilities
  2. Tenant didn’t left at end of lease

I have started already eviction request but is other issue:

Do you think I still should finance that rude "thief" by the name of the "law" or is it OK not to pay and not to call to shut off?

It is going to hurt you if they aren't paid.  Talk to the city and ask them to post notice that the utilities are going to be shut off.

What have you been doing to get the tenant out if they haven't left at the end of their lease?  Are they paying the rent?  Serve them notice that they are in violation of the lease.

Hi Eran,

It looks like you're learning this lesson the hard way, like I also did when I first started out.  I got burned once by keeping utilities in my name and trusting that the tenant would reimburse me per the lease.  

Now, I require tenant to show proof of utility transfer before I hand over the keys.  The only thing still in my name is the water bill, since that is tied to the house and if not paid, will end up tacked on to my property taxes, so the lease says the tenants must reimburse me for that.  But, the utility company can deal with the tenant directly if for some reason they stop paying their gas/electric etc.  Also, around here, if a tenant doesn't pay a utility bill and they try to "jump ship" and set up utilities in their name somewhere else with an unpaid bill, the utility company won't do that until it gets paid.

Even though it's not fair to you, I"m pretty sure in most states its illegal to shut off utilities on your tenants, regardless of if they're current in paying you for them or not.  Since the utilities are in your name, you're the one that's gonna get the fines/late fees if you stop paying.  And also, since you're in the process of eviction, the tenant could accuse you of shutting off utilities to try to force them out, which would then come back on you.  

You're probably stuck paying the bills for now since they're in your name.  I would attempt to go after the tenant for what they owed me, in court, or, take it out of their security deposit after they're evicted if that's an option.  (This is not saying that they're going to be collectible but probably your only option at this point, and with the next tenant make sure they transfer everything over before they move in!)

Originally posted by @Eran R. :

It's tempting to let the utility provider shut the utility off for non-payment, but it's a bad idea. First, it's illegal to shut off the utilities in an effort to evict a tenant. The utilities are in YOUR name, so YOU are responsible for paying the utility bill each month and keeping them on. Then it's YOUR responsibility to collect from the tenant. You have to go through the legal process.

Second, if the utilities do get shut off, that will be a strike against you and could result in additional problems when you try to turn the utility back on.

It's a hard lesson, but the correct thing to do is go through the court.

@Eran R. Why are the utilities in your name? Is this mandated by the county or city the utilities must be in the owners name? I know that is how it works in some areas around the country. Otherwise get the utilities out of your name.

Thank you all,

I got advised from landlord lawyer to put on our name and let them pay because if not you cannot control how much the utility bill is growing at the term you "think" everything is OK (when still pays rent but not utilities) or at term of "no pay no connect" with the delinquent tenant. The utilities are leaned over the house anyhow..

@Piper D. and @Nathan G. - Good advice. Yes, I always require the utilities to be in the tenants name as well. I've never required evidence of this prior to handing over the keys, but I will definitely do that moving forward. Great strategy. 

Thank you all,

I got advised from landlord lawyer to put on our name and let them pay because if not you cannot control how much the utility bill is growing at the term you "think" everything is OK (when still pays rent but not utilities) or at term of "no pay no connect" with the delinquent tenant. The utilities are leaned over the house anyhow..

Originally posted by @Eran R. :

Thank you all,

I got advised from landlord lawyer to put on our name and let them pay because if not you cannot control how much the utility bill is growing at the term you "think" everything is OK (when still pays rent but not utilities) or at term of "no pay no connect" with the delinquent tenant. The utilities are leaned over the house anyhow..

 I'd find another lawyer.  How's that "great" advice working for you now.  It seems to me, what the lawyer thought they could avoid, happened anyway...and all that this "great" advice did, was give an invitation to the tenant to do exactly what they just did.

Originally posted by @Eran R. :

Thank you all,

I got advised from landlord lawyer to put on our name and let them pay because if not you cannot control how much the utility bill is growing at the term you "think" everything is OK (when still pays rent but not utilities) or at term of "no pay no connect" with the delinquent tenant. The utilities are leaned over the house anyhow..

Are you saying if the tenant doesn't pay the utility bill then you will be responsible for the bill? If so, sell your properties and GTF out of that city. Seriously. 

Anytime you are going to be held accountable for a utility bill you need to make sure it is being paid.  Some cities/states will move unpaid utilities to the property tax.  Some don't.  Some allow for ways for landlords to push the expense onto the tenant so the home/owner isn't liable.  In this case, they are in your name.  They city will hold you, the person who's name is on the account responsible.  You will say but I have this lease.  They will say great, your name is on our contract so you pay us and then you go collect form the tenant because your contract is with them.  They will use the very same logic that you are using with you.  But I have a contract with a tenant.  And they will tell you but we have a contract with you.

Also, you should call your utility and talk to them about it.  We take over property management locally for a lot of homes that were with bad managers who didn't have the utilities set up properly.  We have had utility companies work with us to get them set up proper after the fact.

I would not ignore this one, I would nip it in the bud.