All Forum Posts by: Earl White

There is no explicit case or statute that declares late fees cannot be more than 5%. That said, they must be reasonable to form the basis for an eviction and some judges have used 5% as practice.

"In establishing tenants' rights to continued occupancy of their rental dwellings the Anti-Eviction Act is remedial legislation deserving of liberal construction. A.P. Dev. Corp. v. Band, supra, 113 N.J. at 506; Royal Assocs. v. Concannon, 200 N.J. Super. 84, 93 (App.Div.1985); Cima v. Elliott, 224 N.J. Super. 436 (Law Div.1988). Contra Terhune Courts v. Sgambati, 163 N.J. Super. 218, 223 (Dist.Ct.1978), aff'd o.b., 170 N.J. Super. 477 (App.Div.1979), certif. den., 84 N.J. 418 (1980). We find that the clear purpose and spirit of the Anti-Eviction Act -- to ensure that evictions are based on "reasonable grounds" -- require the conclusion that where late payment or nonpayment of rent is the direct result of an unreasonable lease change of the kind impliedly barred by N.J.S.A. 2A:18-61.1(i), such late payment or nonpayment will not furnish good cause for eviction under N.J.S.A. 2A:18-61.1. See R & D Realty v. Shields, 196 N.J. Super. 212, 220 (Law Div.1984) (nonpayment-of-rent action dismissed because based on unreasonable lease change).Tenants deserving the protection of the statute's requirement that lease changes be reasonable cannot be put at a disadvantage because a landlord chooses to bring, in some alternative form (here, a charge of nonpayment of rent), a claim that follows from a tenant's refusal to accept a lease change."

https://law.justia.com/cases/new-jersey/supreme-court/1989/1...

@Tom Server You can just call the local building/construction/housing department for the city and they usually can tell you off the top of their head. You can also just Google rent control and city. For example, I found Jersey City rent on control in about 10 seconds  https://library.municode.com/nj/jersey_city/codes/code_of_or...

Check out the rent control rules in whatever the city is - as long as you comply with those you should be able to increase rent to market rate. I also note that if all tenants are month-to-month with no leases, you should a strong lease in place.

Wecome to the NJ Real Estate Community!

@Ryan Muska - you left attorney off the list : )

Perhaps you can take ownership in an LLC and lease it back to yourself? I'm not 100% sure you'd have to run it by your lender. This would also give you some privacy / liability protection in any case.

Is it required to put the legal property description on the purchase & sales agreement and also the assignment contract? Or do I not have to put this information? You do not need to put the full legal description, which is about 4 paragraphs drafted by a surveyor, on the contracts; however it is customary to insert the lot and block number. I highly recommend https://njpropertyrecords.com/ and many of my investor clients use this and I even have it for myself. You pull up the lot and block on the county website or city tax assessor website – but that would be a bit of a pain to keep trying to find it and there is lots of value in NJ Prop beyond just block lot – i.e. last deed to confirm ownership, tax assessed value, you can click around to nearby properties, flood zone – all key public info in 1 place to pull up instantly

If I do have to put it on the contracts (which I assume to be true) where do I find the properties legal description? For lot block it is customary to add lot and block for specificity – which is important if you are doing a deal with multiple separate parcels with similar addresses; selling properties next to each other.

In my opinion - get your real estate license. You will learn useful information if you are new, don't have to sweat operating in a legal grey area, and you can have side hustle selling for friends/family.

Good moring - I'm not a CPA (rather a real estate attorney) but our firm does handle 1031 exchanges for either simple or complex commercial deals. Feel free to check out the guide I created on this: https://www.earlwhite.law/guide-1031-exchange-new-jersey/

 The way I've approached this is to either: (1) insist on collecting the leases - which generally speaking identify the security deposit; (2) get a rent roll or statement from the seller prior to/at time of contracting. Obviously, seller could fabricate. I would note however - once you increase units beyond 4+, it isn't really feasible for a seller to get tenant estoppels.

That all being said, I've had some luck just dropping in a contract provision like the one below and sometimes seller/their attorney will just roll along.

Seller shall provide the Buyer tenant estoppels executed by each tenant at least seven (7) days prior to closing stating: (a) the rent, term and expiration of the tenancy, amount of security deposit, all agreements between the landlord and tenant, and all rights tenant has to the Property; (b) if rent and/or other payments are current, and if not, overdue amounts; (c) identification of the current written lease, and if none exists, the last expired written lease or statement there has been no written lease; (d) the landlord and tenant have performed all of their obligations to each other; (e) the tenant has no defenses, rights of offset, or counter claims against rent due or to become due; and (f) there has been no free rent, abatements, or concessions, except as disclosed in the estoppel.

In New Jersey, sellers are very resistant to tenant estoppels for residential units. I always try to get it in the contract/rider - 50/50 on getting them signed. I'm not going to kill a deal over it. Commerical deals are different and usually we'll get them.

The real issue here is fraud, landlord confusion, or landlord unawarness.

As an alterative to the estoppels, basically have a post-closing landlord certification drawn up before the closing and signed. Not as good as an estoppel - but it is enough to hold the landlord liable for intentional or reckless misrepresentations after the closing. You could then go to court on this issue if the magnitude was large enough. 

Obviously that isn't a ideal but my clients would lose many investment properties if estoppels were insisted upon. 

As far as removing the tenant after the closing, that is not the law that you can give 60-days notice and tenant has to leave. You could do that for 3-famly if (i) you intend to move-in to the property for personal occupancy but this needs to be legit or you could be held liable; (ii) you have a contract of sale to a party intending to move in. 

Your option with the month-to-month tenants, if neither of two solutions work, is to offer a new lease at market rent and hope they do not accept it. Renovations is NOT a grounds - unless you  are curing code violations and willing to pay relocation costs. 

Hello Catherine - welcome to the forum! Feel free to reach out at your convenience if you have any questions - particuarly on the contract/deal flow side. I've done over a hundred deals myself so always have that perspective as well.