Can a tenant with no lease be evicted in 30 days by the new owner?

12 Replies

Have agreed on price with a homeowner and will get the contract signed tomorrow. This is a deal I will be wholesaling (and will be my first deal, if it goes through). The property has a tenant who has been there for twenty years without a rent increase! The tenant is paying next to nothing in rent and missed this month's payment and the owner doesn't want to deal with the situation.

Since this tenant went into month-to-month status on that original lease many years ago, does that mean that the new owner (whomever I assign the contract to) can evict the tenant with a thirty-day notice? Basically, I'm trying to find out if there's anything I need to do to get this deal done other than get the property under contract and let the buyer know the situation with the tenant? This property is in Maryland.

Lenzy Ruffin, Visionary Realty Investments, LLC | (240) 492‑6654 | http://www.lenzyruffin.com

@Lenzy Ruffin

Read the local tenancy legislation.  In most jurisdictions when there is no written lease, there is a default, implied lease in effect which is frequently a month-to-month term.

In such a case there is no need to evict, just simply serve a notice of termination.

One caveat which comes to mind: some jurisdictions (including our home one) have the concept of a long-term tenant coded in legislation and afford additional rights to such tenantes.  Here a long term tenant is any tenancy which has continued more than 5-years.  In such cases, the tenancy is considered month-to-month from the tenants perspective (regardless of what is indicated in a written lease) and they need only provide 30-days notice of termination.  From the landlords perspective it is considered an annual lease in that the landlord must provide 90-days notice of termination.

Medium greenapartmenthires 1024x1024Roy N., Louer Louer Ltd. | 1.506.471.4126

I actually have an experience with this on one of my rentals. Take this as another way of looking at it.

I have a rental that has a tenant that has been there for 20 years. He was also paying under the market prices for rent. He still wants to stay in the property. Upon agreement, I initially put him on a 2 month temporary lease. Consider this like a probationary lease or even a testing lease.

After that 2 months, if I was happy with his tenancy, I would instate a 1 year lease.

I also immediately raised rents on him but not the entirety up to market prices yet. In my conversations with him, I told him that as a courtesy, I would slowly raise up rents throughout the year to get them to market equivalents. He was happy to abide and also willing to pay the higher prices. In this way, the rent hike would not be a huge hit to his monthly budget.

As such, I now have a long-term tenant who is very happy to stay and probably willing to pay whatever he has to to stay inside and built up rapport with him so that he is happy even though he is paying more now.

I know you're wholesaling the property but maybe the new owner may be interested in doing something like that. Hope that helps in any way. Best of luck.

That's a very creative solution from @Kenneth Sok ; given that the tenant did not pay the recent month's rent, perhaps it is not the best solution in this case, but I could definitely see the value in talking with the tenant and exploring the issue if you think your prospective buyers might be interested. As Kenneth pointed out, it brings a lot of value to the table having such a committed tenant, as long as you can get them on board with the program. Fact is, if they move out they're going to have to pay current market rents anywhere else, so there's a strong incentive to stay where they're comfortable, if you can push the issue.

@Kenneth Sok

That approach will only work if there are no special rights afforded to long-term tenants in the local tenancy legislation.

When we inherit {long term} tenants at below market rents, we meet with them and set a scheduled timeline which will bring their rents closer to market (we will frequently leave them 3-5% below market as a recognition of the long tenancy) where we usually raise their rent a little every quarter over 12 to 18 months to bridge the gap.

If the tenant refuses to negotiate a time line, it is effectively "treating a notice of increase in rent as a notice of termination", which, here, gives them 90-days to move if they are a long-term tenant. 

Medium greenapartmenthires 1024x1024Roy N., Louer Louer Ltd. | 1.506.471.4126

@Roy N.

Agreed with everything you said.

Without any prior relationship, the initial 2-month lease is there to set the stage for this tenant that I mean business and that things will be different. Every bad thing about the tenant (missed payment, house not taken care of, etc.) is a strike against them. If things aren't that bad yet and can be resolved, I'd be open to letting them stay given they play ball.

Otherwise, if they are being difficult, then I wouldn't hesitate to evict them with the tenancy termination.

@Kenneth Sok That is definitely a creative solution I'll keep in my toolbox. I know that the tenant in this case would never be able to pay market rent, regardless of how gradually the rent was increased. But that definitely sounds like a great creative win/win to use in situations where it's feasible. 

Lenzy Ruffin, Visionary Realty Investments, LLC | (240) 492‑6654 | http://www.lenzyruffin.com

It must be initiated through the courts and the tenant must be served by the Sheriff or Marshals. I'm relatively certain all counties in MD follow similar procedures. My friend had a similar problem and had no problem evicting her tenant in Montgomery County MD. MD is so much easier to evict than DC. Hence my years of reluctance to rent my property in DC...too many horror stories. Check out this site from page 23 and search for your local county. http://montgomerycountymd.gov/dhca/resources/files/housing/landlordtenant/handbook_olta.pdf

@Mimi J.

If the OP is simply serving a notice of termination, there should be not need to go before the court:

NOTE: The day of delivery is not counted as part of the notice time. If the notice is sent by mail, it should be mailed early enough to be delivered in time; the courts generally presume delivery 3 days after mailing.
The length of notice from landlord to tenant to terminate the tenancy as required by state law is as follows:
  • In the case of weekly tenancies, notice must be given in writing at least one week before the end of week when tenant is to leave;
  • In the case of tenancies by the month, notice must be given in writing at least one month before the end of month when tenant is to leave;
  • In the case of tenancies from year to year, including tobacco farm tenancies, notice in writing must be given at least three months before the end of the current year of the tenancy. (All other farm tenancies require six months’ notice before the end of the lease year.)
  • In tenancies for a definite term (no provision for renewal), notice in writing must be given at least one month before the end of the term;
  • In tenancies at will (no fixed term), one month’s notice must be given in writing.
The notice periods listed above are the minimum periods required by law if the landlord is to be eligible to seek assistance from the court in evicting a tenant who does not comply with the notice to leave (a tenant "holding over").Read the Law: Md. Code, Real Prop. §§ 8-208(d)(5)(link is external), 8-501(link is external), 8-402

Medium greenapartmenthires 1024x1024Roy N., Louer Louer Ltd. | 1.506.471.4126

In Maryland after the first year a lease goes month to month unless a new lease is signed. With that either party can end the lease with a 30 day written notice. If the tenant does not leave after the 30 days then you would need to get the courts involved.

@Lenzy Ruffin

Like @Roy.N mentioned above you need to look at local tenancy laws. They vary state by state and some cases city by city.  In California for long term tenants you need to give a longer notice than 30 days. You also need to account if the area is in rent control before you can increase the rent to market rent. 

One other that would come into picture here is if the buyer you are trying to assign the contract to wants to flip the property or wants to keep it as rental. The approach you take would be dependent on that.