Property management company withholding rent

12 Replies | Philadelphia, Pennsylvania

Our property management company in Philadelphia is withholding our rental income since we gave them notice to terminate our contract. Any ideas of what we can do? We don't live in Philadelphia. 

@Angela Rawson  

Why are they withholding rent? 

Are they concerned that their final bill to you will not be paid so they plan to deduct it from your rent proceeds and send you the difference once their service is terminated?

Or they are dirtbags. 

Probably one of those two things. 

That is typically once you give notice. Depending on what they might be paying on your behalf. We put a hold on rental payments anytime someone gives termination notice. It is to make sure all accounts are settled. Vendors offer take a few weeks to submit invoices and utility companies are billing for last months usage. As a property manager you don’t want to get left with the bill and no funds to pay it. You may say you are good for it but there are many owners who are not. It is your money. They are holding it to pay your bills. After all the final billing is reconciled you will get your final payment.

Thanks for your responses. I understand they might need to hold over some money for final bills but our contract finishes end of September and we can't get June's rent out of them.

Definitely in the dirt bag category. 

@Angela Rawson

As a general rule, only brokers and real-estate salespersons can act as a property manager for others. So if the situation does not get resolve and you believe they committed a wrong, you can report them to the State Real Estate Commission. That said, I don't know all the facts and whether they have a legitimate legal or business reasons to withhold the rent. 

I suppose it would be helpful if they can give you a reasoning for it.  

Disclaimer: While I’m an attorney licensed to practice in PA, I’m not your attorney. What I wrote above does not create an attorney/client relationship between us. I wrote the above for informational purposes. Do not rely on it for legal advice. Always consult with your attorney before you rely on the above information.

The next instalment.....still no June rent and because we keep asking for it, they are now saying they want to terminate our contract with 3 weeks notice despite contract stating 60 days notice which we have given already.  Contract finishes Sept 30 and they're now saying end of July!

@Chris K. is correct about property managers/companies must be licensed in PA.  If they are not, they are performing real estate activities without benefit of a license--a definite no-no with real estate commission.

I'd contact your tenants and make sure they sent you all rents going forward.  After you hang up with them, meet with your attorney--a strong letter to the managing agent often does the trick.  

Depending on how much money is involved, in PA you could sue in small claims court (max of $12,000).  BTW, I wouldn't worry about disclosing the company name; if they sue you, you can counter sue for your money.  

Remember, it's only libel if it is NOT TRUE.

Legal definition:  

Libel is the written or broadcast form of defamation, distinguished from slander, which is oral defamation. It is a tort (civil wrong) making the person or entity (like a newspaper, magazine or political organization) open to a lawsuit for damages by the person who can prove the statement about him/her was a lie.

The saga continues...our relationship with the PM company is over but they are now withholding our $350 reserve money with no outstanding bills. Also, we have no idea if the lease with our tenant is still valid or void as the PM company  is no longer part of the picture.  We've asked them but of course no reply. Any ideas?