We did it, purchased a 4-plex so my husband and I are renovating our side of one duplex. All the units are rented out so we inherited the seller's tenants and lease agreements. When we viewed the property months ago, 2 units were being vacated. At closing we found out the seller rented out these 2 units (after accepting our offer) - one on a 6 month lease and the other on a 12 month lease. We wished she would have at least told us or asked before signing them up. One of the issues we have is that both the lease agreements list only one tenant but there is another person staying with them. How do we address this issue? We'd like to amend the agreements - if we can - to add a 3-strikes rule for any disturbances. We've already encountered the tenant's drunk boyfriend who challenged us that he owns the place and pays rent (yet he's not on the lease). My husband verbally told the tenant she's in violation of the lease. I appreciate your input and advice in advance. Don't get me wrong - we are very happy with the purchase of this property. We love it, just a couple of issues.
What stipulations does the current lease have about being able to change the conditions? You might be stuck until they expire and you can write them the way you want them to be.
Does the lease outline who can live there and what the consequences are for having unauthorized occupants? Do you have evidence they are living there, or can they claim that they are just guests?
I would enforce the current lease, set a climate of being firm but fair, and maybe offer them an early out if they are not liking the direction things are going. I deal with month to month agreements rather than leases, so not sure if you can mutually agree to write up a new lease adding their additional occupants (run a criminal check and get their info first) and your tougher clauses.
We've started adding fines for breaking the lease/agreement per occurrence, seems to be more effective that three strikes. You have to ask yourself; do you want them gone if they don't respect your rules, or do you want compliance?
Hi Michele - thank you for your reply. We have the original agreements from the seller and when we took it over we gave them an intro letter along with an info sheet for them to fill out (name, contact info, any pets). When we got the forms back they do list an additional tenant/roommate so I think that would suffice as evidence. I like your idea of adding fines, it gives us some structure to add in future agreements.
@Martha T. I'd play it safe and take the following approach:
1. Speak to a real estate attorney, tell him/her your situation and what you want to do. They will know the local tenant/landlord laws and the best way to approach.
2. Show the attorney a copy of your new lease you plan on giving future residents and ask to make any necessary updates.
Might be a couple hours of consultation but in the long run it's worth it.
Hi Joe - thank you for the advice. I think it will be well worth it to spend that couple of hours with a real estate attorney. I know it will protect us and our investment.
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