novice landlords - we need advice with tenant problem

[PJinPHX]

What is the name of your state (only U.S. law)? ARIZONA

We’re novice landlords and are dealing with tenants who are not proving to be as honest or responsible as we’d expected. We’re really afraid to do anything at all until we’re comfortable that they have no legal way of making the situation any worse or of legally evading any possible recourse we might have.

The original term of the lease ends on the last day of this month (August, 2010) and then the lease term automatically converts to month to month. Termination requires a written 30 notice by either party. We also had an “option to purchase agreement” with these tenants which also expires on or before the last day of the month. For the past several months the tenants have been telling us that they are taking the option to purchase and that they will be able to close before the deadline.

The rental agreement required that the last month’s rent be paid in advance. Since taking the purchase option would automatically make this the last month on their lease, we did not question why they did not make a rent payment this month or give us a 30 day termination notice.

Last week we phoned the tenants to remind them that we still needed a written notice specifying when the closing would actually take place. The contract required that notice be given to us but did not specify a deadline… only that closing needed to be on or before the end of the month.

It was then that they told us they decided not to purchase the house and that they’d be giving us back the keys at the end of the month. This was a shock to us and we went by the property later to tell them we wanted to do an inspection sometime in the next few days and discuss the ramifications of the situation with them. When we actually went to do it we found the house wide open and nearly empty. Even our refrigerator and window air conditioning unit had been cleared out. It was a nightmare seeing all the damage, debris and dreadful maintenance issues that had been allowed to exist and accelerate to the state they were in. Certainly way beyond what their security deposit might cover.

It’s become clear that they were purposely misleading us about purchasing.
They still have keys and have left a message loudly proclaiming full access rights until the end of the month among other things, including that we had no right to enter the home. Our phone calls to them are not being returned.

We’re not sure of much at this point but technically, to us, it appears they may still owe this month’s rent payment and may even be obligated to continue paying rent until there is a written advanced notice of termination given. Also, we see that the lease states if rent is not paid within 10 days of being due, it is considered abandonment. Does that not terminate the lease? Can we just change the locks and take over? It’s about 3 weeks since rent should have been paid which even exceeds the additional 7 days that the lease states tenants have to return for anything they may have left behind at the property.

Naturally, we would like to start shoveling things out and try getting things back into shape as quickly as possible so we can rent it again. So we’d really like some suggestions on how to proceed with this. What would be the safest, quickest or best way to minimize damages and recover from this situation?

Thanks very much for taking the time to read this and for any advice you may have to offer. - PJ

 

[FarmerJ]

Pj page 22 ,http://www.azag.gov/civil_rights/TenantRightsResponsibilities.pdf Abandonment
A. If you abandon your home (which means that you move out and stop paying rent
without notice to the landlord), your landlord may mail a notice of abandonment
to your last known address and post a notice of abandonment on the door of the
home.
B. Five days after mailing and posting abandonment notices, the landlord may
change the locks and retake possession of the home.
22
1. After the landlord has retaken possession of the home, he must hold onto
your possessions for ten (10) days, before selling them or throwing them
away.
2. You will need to pay for storage and moving costs to get anything back.
C. Your landlord may additionally charge you a fee for breaking your lease or
charge you rent for the months left on the lease.
Is what I found so its up to you to verify its accuracy , First did you take pics of the junk and damages yet ? ( if not spend the consult fee with atty to make sure this suggestion is okay) then make two notices , and follow the above make two notices one to mail copy via certified mail or confirmed mail and have someone hold a newspaper headline up to the other two notices ( one notice is saying you will enter to inspect for damages the next day ) that you tape to the door and take a picture of them in order to help create records of the notice being given, ( use huge font on the letters to make it easier to read and date and sign them ) At the end of the abandonement notice make sure you carefully inventory every thing they left behind and once the locks are changed then plan on suing them for one month of rent and make a detailed billing for the damages room by room, like say bedroom door knob broken , list next to it replacement door knob 9.99 trash fees , abc sanitation 100.00 etc send it with in time frames your state allows re damage deps and plan on in the end suing them for the damages as well as one months rent. ( and yes atleast make sure you run this all by a atty other wise if you get it wrong you may well have to start from scratch wasting more time and money)

 

[PJinPHX]

Thanks to "Farmer" for reply

I’m not too sure your definition of abandonment will work. They knew we were at the house, so obviously they still come and go… and could even deny having moved out. And could the pre-payment made for the last month’s rent have any influence?

Also, if the next step we must take is to post a notice of abandonment, is there some reason we can’t post it simply because the lease considers it to be abandonment since they’re more than 10 days late on their rent?
I ask that because we thought the terms of the lease agreement we had with them gave us pretty good legal protection. But if we can’t legally enforce them, it seems like a simple rental form could have sufficed just as well.

It will take some time to prepare this notice and arrange to meet with a lawyer and go over everything. Then after the 5 additional days of waiting it’s already the end of the month and they’ve already stated we’ll have their the keys by then.

I’m really much more concerned about NOW and what lawful options we may have to prevent any chance they will cause us more problems. They’ve already taken our refrig and AC and after hearing the hostile message that was left, I worry that they might even take other things out of the house and do things that will cause greater damage. I may be overly cautious now but I’m sure no one believes that they just want to retain access in order to clean up after themselves or make repairs.

And yes, I had my camera and took a few pictures when we were there. They give you a good idea but don’t show the detail.

BTW, I appreciate the helpful details you provided in your message and thank you for taking the time to help.

 

[FarmerJ]

Pj you said it appears they owe this months rent in your first post, if it was me and the lease didnt require them to move out by the end or complete the purchase by end of the lease but renewed even if on a month to month basis then I would argue they didnt give proper notice to vacate in writting they not only still owe aug rent and the last month paid would apply to sept unless your able to go in , fix it up and get a new customer in there sometime in sept then the short rent would be prorated when I would sue them. Those rent to own deals are not good , way too messy , your better off keeping it as a rental until such time where you can sell it to someone who can either give you a HUGE down payment to do a contract for deed or a buyer who will have regular mortgage.

 

[PJinPHX]

At the end of the original lease period the terms automatically continue on a month to month basis. And the rental agreement is separate from the purchase option agreement. (Strange thought, but I guess maybe if they had purchased the house you might be able to say they would become their own their own landlords.)

I take it that you believe the rental agreement is what the law would base any decision upon so I’m encouraged by your argument and feel you (we) would win, hands down! But with tenants who don’t seem to care about upholding their responsibilities on a lease, we’re not so sure that winning a law suit against them would be terribly effective in actually recuperating damages. How do we enforce things if they decide to slink off to parts unknown? After what happened, that would not surprise us.

So in your opinion, considering the strength of that possibility, do you honestly believe it would prove worthwhile to devote the time and emotional energy required to prevail in this situation? I don’t think we would have ever hesitated a while back but I’m sorry to say that this has shaken us up and we’re trying to be much more careful about committing to something that may not turn out quite as well as normally assumed.

And you really nailed it about rent-to-own deals. Never again!!

Also, referring back to your original message…
How crucial do you believe it is it for us to itemize everything? Must we dig through all the trash and stuff they’ve left everywhere? Dog and cat urine seems to permeate just about everything and there is griminess from working on car engines, along with mold and who knows what other awful stuff. Writing up any inventory is not going to be a very pleasant task.

Thanks again for your suggestions and experienced opinion. We really appreciate the input.
- PJ

 

[FarmerJ]

detailed damage statements and documenting whats been left behind , pics will address some of it BUT say in the end you changed locks , cleaned up the junk , threw it out and later tenant claims to a court you threw out great great auntys coin collection books , or designer furniture or somethings of a higher value and you know it was just JUNK but didnt have proof of what it was that was abandoned. It is up to you to have a record of what was left behind in order to show a court that the tenant is full of it. Same with damage itself tons of pics and then reciepts for the repairs, So theres pet crap on the carpet YES pics and even saving a section of the carpet and then pics of staining under the carpet ( if floor surface under it is damaged) to help create a record of the damages. When its all repaired take pics of how nice it looks before letting another tenant in and remember with your leases that they are your bible and all terms are enforceable ( unless a item in the lease goes against your states laws) when your speaking with the atty one thing too you may want to do is have the atty draw up for you lease blank to be used in the future rather than generic ones from stationary stores or to recomend to you where you can get a well written one for your states laws to use in the future.

 

[Gail in Georgia]

OP... Couple of things to keep in mind.

1. Your neighbors called you telling you that your house was "wide open" and it appeared no one was living there. You responded to this "emergency" situation as you are allowed to do without the necessity of giving prior notice. (repeat this justification to yourself as often as needed should this entire business end up in court and the tenants claim you entered the rental unit without adequate notice to them).

2. Be nice to these tenants until they hand you the keys at the end of the month. They can do a heck of a lot of damage from now to the end of the month. Stress that you need to know their forwarding address so you can send them information on the status of their security deposit (which, I'm assuming you collected at the beginning of the lease) as required by state law. You then have a new address to serve them should you consider filing a lawsuit against them later.

3. As FarmerJ said, take pictures of EVERYTHING. A piece of carpet with urine smell can have a powerful influence in a courtroom.

4. Before you consider a lawsuit you need to realize that winning such is absolutely no guarantee that you'll ever see a penny of this money. Check to see if bank or wage garnishment is an option in your state. You have a copy of where they bank and their account on every check they have written to you. If their income happens to be based on disability please be aware that this cannot be garnished for issues like owed rent or damages to your property. Sometimes it simply is easier to lick your wounds, and focus on cleaning up the place and getting it rerented ASAP rather than expending the energy to go to court.

5. What do you plan on doing regarding the refrigerator and window air conditioner they appear to have stolen?

Gail

 

[PJinPHX]

The shock of this has diluted enough now that I think we’re finally starting to digest it without so much stress and emotion. Have to accept that we don’t seem to have much power over anything until they turn over the keys or until the end of the month when there should be no question about our right to go in and change the locks and start doing whatever must be done to restore the property to a decent state.
It will probably take more than winning a law suit to see compensation from these people but we’ve decided to follow through with it anyway… on principle I guess.
But we’re still open to handling this in some other/better way, so if anyone with more experience cares to add their two cents, PLEASE GO AHEAD AND POST A REPLY.

Hello again, FARMER ---

I’m bracing myself for that inventory. Unless it’s just too foul, it will be stored for them to pick up for as long as we’re required to do it. Hoping that photos of what does go out In the trash might serve to justify why auntie’s books, etc, had to be dumped.
Fortunately we have some good “before” pictures and will take plenty more “afters” to show how they left it. Will zip-lock samples of carpet, pad and possibly even other surfaces that have to be replaced. (Great suggestion! - thanks) And yes, when it’s all over we’ll take new “before” pictures.
I guess all of that, along with estimates and/or repair receipts, etc, should support the damages claim pretty well. Wish I could claim something for having to do this inventory thing but I doubt if that would sit too well with a judge.
It’s comforting to know that we can depend on the terms in our lease as being the determining factor if legality is ever questioned. In that disturbing message our tenant left he made numerous legal sounding references that seemed to support his rights (and our wrongs) but they differed from the terms in our lease. Before we jumped into this new landlording venture we were pretty careful about finding a good lease form and did have an attorney verify the final tweaks. Now suddenly it appears that wherever I look there is some law in existence that counters the conditions we have in the agreement so I started worrying about how enforceable it really was. Your comments have restored some of my faith in it.

- - - -
Hello to GAIL IN GEORGIA, and thanks for adding your wisdom ---

1- Fortunately the neighbors won’t need to testify on that because we’d been by several days before and told the tenants we wanted to inspect. We weren’t impolite but did make it a point to add that we wanted to give them notice of it and for them to understand that this was what we were doing. (The lease specifically allows us to give verbal notice to enter as long as it’s given at least 24 hours in advance.) So even if we’d needed our key, we DID have the right. Would like to know what gave THEM the right to leave our property wide open and unprotected. (2 door were actually thrown aside off of their hinges and one in the back was broken apart with the top third of it missing.)

2- It haunts me, thinking what further damage they are still free to do. We’ve called many times and have left many messages (yes, very polite ones) but they’re not returning our calls. They paid a $850 damage deposit but it’s obvious that damages total far more than that. So I don’t think a status report isn’t something they’d care much about getting. But in some cases, that seems like a great ploy to keep in mind.

3- Yes. (What did we do before digital cameras?)

4- We’ll probably sue, even knowing how unlikely it is that it will change much. It doesn’t feel right to just roll over and accept people who do things like this. And to us it seems like the only legal way we have of protesting their irresponsible behavior.
It probably won't be easy finding ways to handle the sort of issues you're mentioning but I guess we'll just have to stay alert and deal with each one as they come up.

I really believe that if more people would just take a little more responsibility for the things they do, we wouldn’t have such a need for leases and lawsuits like this. Then I could be thinking about much more enjoyable things and not have to be so focused on stuff like damages right now.

5- Will have to replace them... more $$$ gone. Not sure if "disappearance" falls in with the repair type damages but it's probably the simplest way to address that problem.


I'll try to update as this goes on.
THANKS TO BOTH OF YOU FOR THE GOOD INFORMATION.
- PJ

 

[atomizer]

My two cents;

Take the time to determine the exact amount of the damages involved, including rent, cleaning, repairs and costs of stolen items. Mail them the itemized list with that amount being deducted from their Security deposit. The total due them should be a negative number. Send the amount they owe you to their last previous address by certified or priority mail and delivery confirmation. The address should be their last known address. (Your rental property)

Make sure you don't miss the state mandated notice requirement for the return of the SD, or you may end up having to return their SD in its entirety.

 

[FarmerJ]

Yes even if the totals for damage are not complete you can start out with all the largest items and then remember to use prorated amounts EG the carpet was 2 yrs old when they moved in. carpet should last at least 5 yrs so depreciate the remaining useful life of the carpet is what they would have to pay for but say you have to pay 200.00 to sand and treat wood flooring under the carpet to remove pet urine from the floor surface under the carpet get that full amount in there too as a individual line item , that is damage they cannot refute easily & pushes the total up. Any way even if your not done the deposit disposition can say that totals are not complete and you will amend the total at a later date when you send it out , this way they have something in hand to stop a claim of no notice re deposit being sent even if it is to the last known address which is the one they rented from you. It doesnt mean they wont try to dispute it but then again it gets something sent out with in your states timelines. If any mail you send to them about the deposit comes back from post office as not picked up Do not open it , leave it sealed and in original condition with your copies and if they make a claim against you re the deposit then they can explain to a judge why they didnt pick up the mail. I know this all can seem so adversarial but the thing is its about proofs and paper trails. BTW I hate to say it but I will , by the time you get past the odor and start getting the things out of the unit that stink, the odor will ease and then it will be a memory.