What went wrong?

[Xephyron]

I bought a house at the end of last year with tenants living in it. Their lease ends 3/31/2012. Ever since I bought the house, they never paid their rent on time, usually paid on the 15-20th of the month instead of the 1st like the lease said. So I decided that this is not gonna work out and that I need to fix up the house a bit (it's in a pretty bad condition). So I told him sometime in March that I would not renew their lease, but they could stay at the house before they find a new apartment as long as they keep paying rent (reasonable?). Then fastforward to today; after they finally moved out, without paying April or half of May's rent (I guess I still 1 month of security deposit), one of the guys sent me wall of hateful text messages cussing me for kicking them out and told me don't ever contact him again or he will bring legal trouble on me.

So, what did I do wrong here? Could I have handled this situation any better? I guess I wanna learn something from this unpleasant experience. Thanks for your input!

[Anthemyst]

Financial penalties for late payments instead of just deciding not to renew the lease over it?

[The Cuddling Wingman]

I bought a house at the end of last year with tenants living in it. Their lease ends 3/31/2012. Ever since I bought the house, they never paid their rent on time, usually paid on the 15-20th of the month instead of the 1st like the lease said. So I decided that this is not gonna work out and that I need to fix up the house a bit (it's in a pretty bad condition). So I told him sometime in March that I would not renew their lease, but they could stay at the house before they find a new apartment as long as they keep paying rent (reasonable?). Then fastforward to today; after they finally moved out, without paying April or half of May's rent (I guess I still 1 month of security deposit), one of the guys sent me wall of hateful text messages cussing me for kicking them out and told me don't ever contact him again or he will bring legal trouble on me.

So, what did I do wrong here? Could I have handled this situation any better? I guess I wanna learn something from this unpleasant experience. Thanks for your input!

When in March?

[redprinceton]

When in March?

Doesn't really matter seeing as that he let them stay there until they found a new place.

[The Cuddling Wingman]

Doesn't really matter seeing as that he let them stay there until they found a new place.

Ah, true

[greenman]

You needed to be a hard-ass about getting the rent on time from the beginning.

[Xephyron]

Financial penalties for late payments instead of just deciding not to renew the lease over it?

I considered that, but seeing as how they have trouble getting the money paying their monthly rent, I was afraid that they would stop paying rent all together if I impose penalty, which would probably increase the rent by 30-50% since they pay so late. But I guess I could try that next time.

[Jack]

Be happy they're gone.

[JollyGoodFCAS]

They stayed at the apartment with the expectation that a new 1-year lease would be signed in March. You told them last minute that the lease would not be renewed, and while you gave them the option of staying at the apartment, you effectively pressured them to move out.

Better options:

1. Give them 60 days advance notice
2. Give them a 6-month lease, if permitted by law, and warn them that they would have to move out afterwards.
3. Get that stick out of your ass regarding the late payment of rent. Exactly how much interest do you expect to collect in 2 weeks? My current lease provides for a late fee if the rent is received after the 10th - I'm sure you could have added something like that.

[Xephyron]

When in March?

When they finally paid the rent for March, which would be the 19 or 20th I think. They didn't seem to be mad when I told them back then, I thought they understood me :roll:

[DyalDragon]

Be happy they're gone.
:iatp:

[The Wizard of Awe]

You needed to be a hard-ass about getting the rent on time from the beginning.

This. Also, penalties after the 5th of the month.

[The Wizard of Awe]

My current lease provides for a late fee if the rent is received after the 10th - I'm sure you could have added something like that.

Wow, you have a generous landlord. He was likely locked into the old lease, since it sounds like he bought it while they were under lease. So, I doubt he could have added anything, but could going forward with new tenants.

[Xephyron]

They stayed at the apartment with the expectation that a new 1-year lease would be signed in March. You told them last minute that the lease would not be renewed, and while you gave them the option of staying at the apartment, you effectively pressured them to move out.

Better options:

1. Give them 60 days advance notice
2. Give them a 6-month lease, if permitted by law, and warn them that they would have to move out afterwards.
3. Get that stick out of your ass regarding the late payment of rent. Exactly how much interest do you expect to collect in 2 weeks? My current lease provides for a late fee if the rent is received after the 10th - I'm sure you could have added something like that.

Good points, I should have informed them earlier.

I inherited the lease from the previous owner which had no late payment penalty, do I have the rights to change the lease? I am not really good at knowing what I can/can not do as a landlord

[Anthemyst]

I considered that, but seeing as how they have trouble getting the money paying their monthly rent, I was afraid that they would stop paying rent all together if I impose penalty, which would probably increase the rent by 30-50% since they pay so late. But I guess I could try that next time.

Oh, then that's your problem. Don't have tennants who are struggling to make rent from one month to the next. Have a minimum salary requirement.

[FattyMcGee]

what went wrong? plenty:

1) You didn't impose any penalty on them for paying rent late. This was apparently not listed in the terms of the lease agreement. Therefore, they felt they could get away with whatever they wanted. A clause should have been (and should be next time) that any payment after the 5th of the month is considered "late" and will be subject to a $25 fee. Any payment after the 15th of the month is delinquent and will be subject to a $100 fee.

2) You didn't provide them at least 1 month's notice that their lease would not be renewed. Courtesy would have been to tell them in February that March would be their last month.

3) You had a verbal agreement for "staying in the house until they found another place", rather than a signed contract with terms of month-to-month rental and renewal conditions. This allowed them to just do whatever they wanted for those months.

4) You gave them the option to stay in the house after the lease was not renewed, rather than letting them make that request on their own. This gave them the power, not you. You should have said, "lease is up at end of March, I'm not planning on renewing it. I expect you to turn in the keys on April 1. Any questions?" Then if they come back with, "we don't have any other place to go," you can negotiate terms. When they had the power, it showed.

What should you learn from this?

A) Make sure you think of all contingencies you want to deal with beforehand and put those into the rental agreement. You will not like making decisions at the spur of the moment.

B) Make sure it's unemotional. Don't respond to his "wall of texts" with anything. If there were emotional exchanges beforehand, you need to be a calm, level-headed dude who's just running the property as best you can. Sounds like you're not going to try to escalate, but if you think to, DON'T!

C) You're not going to get any more money out of those guys, sorry. At some point you're either going to have to be a hard-line person or a nice guy. Hard-liners get paid, nice guys don't. You can't be both.

May you have better luck with your next tenants.

[Xephyron]

By the way, I didn't get my keys back as they left without me being there, and you know, I can't contact them now (well I could if I want to receive more hateful text?). Am I in trouble for not getting the keys back? I still have the security deposit also.

[JollyGoodFCAS]

Wow, you have a generous landlord. He was likely locked into the old lease, since it sounds like he bought it while they were under lease. So, I doubt he could have added anything, but could going forward with new tenants.

What I meant was that he could have added it to the new lease rather than kick them out. And what's this about a 50% late payment? I've never seen late fees > $100, which is already a windfall for the landlord since 10 days hardly makes a difference when receiving a payment.

[FattyMcGee]

Good points, I should have informed them earlier.

I inherited the lease from the previous owner which had no late payment penalty, do I have the rights to change the lease? I am not really good at knowing what I can/can not do as a landlord
Sounds like this would have been a good question for your lawyer or, at a minimum, your realtor when you bought the place.

ETA: By the way, I really like threads like this that help people learn things.

[Serena]

Good points, I should have informed them earlier.

I inherited the lease from the previous owner which had no late payment penalty, do I have the rights to change the lease? I am not really good at knowing what I can/can not do as a landlord

You might not have been able to change the terms of their current lease. But you could have upped the rent with the new lease and imposed penalties for late payment ... That probably would have gotten them to move out on their own in the same time frame and with same dollars collected. :shrug:

I have a rental property now for sale. I don't want to be a landlord anymore. This is why. People are unreliable and they don't care about paying rent on time nor about trashing a property that doesn't belong to them. My former tenants were family, and they took care of the house and paid the rent. But I've heard too many horror stories and I just don't want to mess with it. I just want someone to buy the damned place!!

[JollyGoodFCAS]

By the way, I didn't get my keys back as they left without me being there, and you know, I can't contact them now (well I could if I want to receive more hateful text?). Am I in trouble for not giving the keys back? I still have the security deposit also.

You'll just have to change the lock, usually a good policy anyway even if you get the keys back since you want to protect your future tenants from break-ins.

[The Wizard of Awe]

When they finally paid the rent for March, which would be the 19 or 20th I think. They didn't seem to be mad when I told them back then, I thought they understood me :roll:

:shrug: The places I've rented have all had in their contracts one of the following two things:
A) Your lease will not renew automatically, but you will enter a month-to-month contract. If the price of your size apartment increases, your rent goes up. (Like if I'm paying $500 for a one bedroom, and they start making leases for one bedrooms $550, my rate automatically jumps to $550.)

B) Your lease will not renew automatically, if you do not create a new lease more than one (sometimes two) month(s) before the end of your current lease, you will be forced to move out at the end of your lease.

[JollyGoodFCAS]

You might not have been able to change the terms of their current lease. But you could have upped the rent with the new lease and imposed penalties for late payment ... That probably would have gotten them to move out on their own in the same time frame and with same dollars collected. :shrug:

Laws vary as to rent increases. Many years ago I lived in a town with rent stabilization, but one time I got an apartment where the landlords found some obscure loophole ("tax surcharge" - WTF) and upped the rent by $200 (>20%) without making any major renovations. It was no big deal, since they were a nice young couple and I was still paying less rent than the tenant on the ground floor.

[redprinceton]

Good points, I should have informed them earlier.

I inherited the lease from the previous owner which had no late payment penalty, do I have the rights to change the lease? I am not really good at knowing what I can/can not do as a landlord

Change the locks. It is good practice and a small price to pay.

It seems like you have a lot to learn about land lording. Since you're going to be fixing up the house anyway, now would be a great time to learn.

On the bright side, these guys sound like bad tenants and you probably won't miss them. On the less than bright side, tenants who rent houses are usually a mixed bag. In general, if they were responsible, they'd probably own a house instead of rent one. (not to drag this into a renting vs buying thread, it's just that in my experience, people who rent houses usually aren't doing it for the financial flexibility, but because they have no money saved up and bad credit.)

[Xephyron]

:shrug: The places I've rented have all had in their contracts one of the following two things:
A) Your lease will not renew automatically, but you will enter a month-to-month contract. If the price of your size apartment increases, your rent goes up. (Like if I'm paying $500 for a one bedroom, and they start making leases for one bedrooms $550, my rate automatically jumps to $550.)

B) Your lease will not renew automatically, if you do not create a new lease more than one (sometimes two) month(s) before the end of your current lease, you will be forced to move out at the end of your lease.

The lease said "at the expiration of the lease term, lessee shall quit and surrender the demised premises in as good state and condition as they were at the commencement of this lease, reasonable use and wear and damages by elements expected." Is that a standard clause. I didn't know about the 60-day advance notice rule, I will put that in mind now.

[FormLetter]

I bought a house at the end of last year with tenants living in it. Their lease ends 3/31/2012. Ever since I bought the house, they never paid their rent on time, usually paid on the 15-20th of the month instead of the 1st like the lease said. So I decided that this is not gonna work out and that I need to fix up the house a bit (it's in a pretty bad condition). So I told him sometime in March that I would not renew their lease, but they could stay at the house before they find a new apartment as long as they keep paying rent (reasonable?). Then fastforward to today; after they finally moved out, without paying April or half of May's rent (I guess I still 1 month of security deposit), one of the guys sent me wall of hateful text messages cussing me for kicking them out and told me don't ever contact him again or he will bring legal trouble on me.

So, what did I do wrong here? Could I have handled this situation any better? I guess I wanna learn something from this unpleasant experience. Thanks for your input!

1) you didn't enforce late penalties the minute they were incurred the first time
2) you told him you wouldn't renew the lease, but should have put it in writing with a definite end date
3) you haven't yet pursued them for payment of unpaid rent

[FormLetter]

Good points, I should have informed them earlier.

I inherited the lease from the previous owner which had no late payment penalty, do I have the rights to change the lease? I am not really good at knowing what I can/can not do as a landlord

There is another mistake.

You purchased the place knowing the tenants came with it and that they had no late payment penalty.

[JollyGoodFCAS]

The lease said "at the expiration of the lease term, lessee shall quit and surrender the demised premises in as good state and condition as they were at the commencement of this lease, reasonable use and wear and damages by elements expected." Is that a standard clause. I didn't know about the 60-day advance notice rule, I will put that in mind now.

Advance notice rule depends on the law in your jurisdiction. I've always had a provision in my lease for the landlord/tenant deciding when to renew or cancel. I'm surprised that there is no such provision in your lease. But it's also the duty of the tenant to make sure that they have a signed lease in advance, for their own protection.

[Xephyron]

There is anothe rmistake

You purchased the place knowing the tenants came with it and that they had no late payment penalty.

Yea, that was my mistake. I took the seller's word that they were good tenants. The tenants "seemed" nice when I talked to them too.

[FormLetter]

By the way, I didn't get my keys back as they left without me being there, and you know, I can't contact them now (well I could if I want to receive more hateful text?). Am I in trouble for not giving the keys back? I still have the security deposit also.

No, you aren't in trouble for not giving the keys back. Who did you expect you would have to give keys back to? Maybe you should rewrite that post.

[Xephyron]

No, you aren't in trouble for not giving the keys back. Who did you expect you would have to give keys back to? Maybe you should rewrite that post.

Oops, I meant getting the keys back. :tfh:

[FormLetter]

Are you planning on staying a landlord? Or are you going to move into this place?

[FormLetter]

Oops, I meant getting the keys back. :tfh:

Ok, then no, you're not in trouble. Just change the locks.

[ditkaworshipper]

Good points, I should have informed them earlier.

I inherited the lease from the previous owner which had no late payment penalty, do I have the rights to change the lease? I am not really good at knowing what I can/can not do as a landlord

By the way, I didn't get my keys back as they left without me being there, and you know, I can't contact them now (well I could if I want to receive more hateful text?). Am I in trouble for not giving the keys back? I still have the security deposit also.
Honestly, this sounds to me like you made a pretty large investment without checking into some pretty important details. I recommend you go to a lawyer that specializes in this kind of stuff. These are actually pretty concrete questions that should no be terribly difficult to handle. I know it's going to cost some money, but it's going to save you a lot of time and money in the long run.

[wooHoo]

Laws vary by state regarding lease renewals.

My lease, if not renewed, turns into a month to month contract (with the rent going up about 25%). tenant has to give 60 days notice. Landlord can kick someone on a month to month lease out at the end of any month...

[JollyGoodFCAS]

Yea, that was my mistake. I took the seller's word that they were good tenants. The tenants "seemed" nice when I talked to them too.

Paying rent 2-3 weeks late does not necessarily make someone a bad tenant. One time many years I went through a rough financial patch where I paid the rent a month late. Aside from a "your rent is in arrears" notice I didn't get hit with late fees or complaints for a long time. Then a new building manager came in and decided to be tough, so I had to scramble around and come up with the money to avoid eviction.

If the previous landlord allowed late payment, they will continue to pay late, especially if they aren't making much in salary. The whole business at the end with the text messages was a reaction to their being kicked out on short notice, which was excessive but I can understand them being upset.

[Xephyron]

Are you planning on staying a landlord? Or are you going to move into this place?

I am planning to remodel the place and rent it out again.

[Xephyron]

Paying rent 2-3 weeks late does not necessarily make someone a bad tenant. One time many years I went through a rough financial patch where I paid the rent a month late. Aside from a "your rent is in arrears" notice I didn't get hit with late fees or complaints for a long time. Then a new building manager came in and decided to be tough, so I had to scramble around and come up with the money to avoid eviction.

If the previous landlord allowed late payment, they will continue to pay late, especially if they aren't making much in salary. The whole business at the end with the text messages was a reaction to their being kicked out on short notice, which was excessive but I can understand them being upset.

Yes, I can understand them being upset, that's why I said they could stay there as long as they can before they find a new place. But I guess I will send a 60-day notice letter next time.

[FormLetter]

I am planning to remodel the place and rent it out again.

I recommend you get some education on landlording then.

Here are some methods I recommend:
-read books on the topic, several of them
-look up the landlord/tenant laws in your area
-find a forum where you can ask specific questions to experienced landlords (the AO might work for this to some degree)
-take a class on property management if there is one available
-join a landlord organization where you can talk to experienced landlords
-read books about different kinds of repairs and skilled trades so you can have an idea what goes into the remodels/repairs that you will be paying for or doing yourself
-look at hundreds of properties online and at least dozens in person so you can learn your market

Also, I recommend you don't rent it out again until you've done a decent amount of the above stuff.

[Jack]

Let it go.
Change the locks.
Do a better job of selecting a tennant next time. Look for a widow with a pension.

[Loner]

Let it go.
Change the locks.
Do a better job of selecting a tennant next time. Look for a widow with a pension.

If you're going to give advice like that, you should probably also let him know it's illegal to explicitly do that. He's already demonstrated a lack of knowledge of the basics.

[FormLetter]

Don't do it explicitly.

Half the time when I talked to the pro Section 8 landlords in my market, they recommended going for people who are 40+ that have been on Section 8 for a while, b/c they claimed those tenants would never leave once they move in.

[JollyGoodFCAS]

Didn't Cpl. Klinger try for a Section 8 by dressing up like an old lady?

[Italian Halibut]

Be happy they're gone.

:iatp: