Rental House Issue

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biscuit
Posts: 91
Joined: Thu Dec 12, 2013 1:33 pm

Rental House Issue

Post by biscuit » Sun Aug 12, 2018 9:19 pm

We have a rental house approx. 5 hours from where we live. I got to know a few days ago that the current tenant is breaking the lease and moving out 4 months before the lease term ends. Now, I got to know this news only after contacting my property manager for some other thing even though she knew the tenant move out a couple of weeks ago.

We have multiple issues with the property manager and our plan is to get out of this rental nightmare after this lease ends. Looks like my property manager and the tenant became friends and without even informing me, the tenant and property manager had discussion(s) about finding another tenant to replace the current one.

My property manager is telling me that the tenant is willing(?) to pay $500 sublet fee when the agreement doesn't have any early termination options (Language in the agreement -Tenant is not entitled to early termination due to voluntary or involuntary job or school transfer, changes in marital status, loss of employment, loss of co-tenants, changes in health, purchase of property, or death). The house is located in TX.

My questions:
1. I have already communicated my properly manager the terms in the agreement. However, what other steps/precautions I can take now?
2. I no longer trust my property manager. Can I tag along during move-out walk-through?
3. How to find a good realtor from long distance to sell the house?
4. Have anyone used Redfin for selling your house before? If so, would you recommend them?
5. Anything else I need to know reg. selling house from long distance?

ny_rn
Posts: 401
Joined: Sun May 11, 2014 7:09 am

Re: Rental House Issue

Post by ny_rn » Sun Aug 12, 2018 9:59 pm

I have no advice for you, but I will definitely follow this thread.

I just purchased a rental property. :shock:

runner3081
Posts: 1493
Joined: Mon Aug 22, 2016 3:22 pm

Re: Rental House Issue

Post by runner3081 » Sun Aug 12, 2018 10:16 pm

I would fire the property manager now. Take over self-management for the move out, finding a new tenant and move in. After that, hire a new property manager that you have vetted during the time period of finding a new tenant.

CedarWaxWing
Posts: 550
Joined: Sun Nov 02, 2014 12:24 pm

Re: Rental House Issue

Post by CedarWaxWing » Sun Aug 12, 2018 10:22 pm

1.. Have every communication in writing, i.e. email.
2. After any phone calls write a summary of the call timed and dated.
3. There are very few property managers who are honest, hard working, and looking out for your best welfare.
4. If you have an attorney... give that person a call and ask if he/she feels there is something to pursue here. My guess is it will not be worth the time and money to do that.. unless a letter and threat of a suit against both the manager and tenant is something you wish to pursue. That is likely not worth it.

5. They became friends? Romantic friends... ? that makes it even less likely you can pursue this and win anything since they will have all kinds of reasons and ways to make you look like a bad landlord... but if the PM breaks the law... you may be able to file a complaint with the licensing agency. How effective that is may vary based on where you live, the laws etc.

6. Good luck... fund a new PM or manage it yourself if you have the interest. In my experience... the risk of a bad PM is more than the risk of a bad renter. The PM do their nasty ways every day for years... and they are really good at saying but not fulfilling what they say. Most renters are not so skilled at deception, and there are data banks to check on them.. no so for the property managers. (BTW.. in most places, and entry qualifications is VERY low, especially in light of the amount of responsibility and money they manage.

Archimedes
Posts: 123
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Re: Rental House Issue

Post by Archimedes » Sun Aug 12, 2018 11:32 pm

Tenants break leases early for all kinds of reasons. That is one of the reasons most landlords take a security deposit upfront. And breaking a lease can happen even when the lease explicitly prohibits it.

Most landlords simply find a new quality tenant as quickly as possible and deduct any turnover expenses from the departing tenants’ security deposit. Although the tenant may have legal financial responsibility for your losses if they exceed the security deposit, most often it is not worth the time, money and effort to pursue a tenant in court.

If I were in your shoes, I would get to work on both a new tenant and a new property manager.

Katietsu
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Re: Rental House Issue

Post by Katietsu » Mon Aug 13, 2018 3:47 am

In my experience, you are required by law to limit your losses. So, you must use due diligence to get a new tenant in as soon as possible. You can not just let the place sit empty by choice until the end of the lease and have the “old” tenants pay the rent. The only way you could pursue the current tenant for 4 months rent is if it actually took that long to find a new tenant. Keep this in mind when deciding on whether the $500 sublet fee proposal is reasonable.

If your goal is to sell it as soon as possible, then it seems in your best interest to let the current tenants go and list the property.

denovo
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Joined: Sun Oct 13, 2013 1:04 pm

Re: Rental House Issue

Post by denovo » Mon Aug 13, 2018 3:52 am

ny_rn wrote:
Sun Aug 12, 2018 9:59 pm
I have no advice for you, but I will definitely follow this thread.

I just purchased a rental property. :shock:
Did you read this thread?

viewtopic.php?t=226980
"Don't trust everything you read on the Internet"- Abraham Lincoln

gotester2000
Posts: 509
Joined: Sun Nov 12, 2017 1:59 am

Re: Rental House Issue

Post by gotester2000 » Mon Aug 13, 2018 7:28 am

"Tenant is not entitled to early termination due to voluntary or involuntary job or school transfer, changes in marital status, loss of employment, loss of co-tenants, changes in health, purchase of property, or death"
- now is this a superlative degree of exaggeration!!!

renue74
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Re: Rental House Issue

Post by renue74 » Mon Aug 13, 2018 7:35 am

It's 4 months....let it go. It'll take more time to fight than worth it.

Get the tenant out as quickly as possible. Make sure you communicate in writing that the lease has been updated to show a new lease ending. Make them sign it. On that day....get them out, clean up, and post on CL, zillow, trulia, etc. to get a new tenant.

PM sucks...get rid of them and find a new one.

Streamline your vacancies as much as possible. No need to fret over a few months...when you need to be proactively looking forward to filling the vacancy immediately.

I've "turned" a rental property on 2 days. day 1...tenants moves out.....I clean up. day 2....new tenant moves in. Vacancy is your enemy. Fretting over bad tenants will not make them good tenants. Using bad PMs won't help you.

biscuit
Posts: 91
Joined: Thu Dec 12, 2013 1:33 pm

Re: Rental House Issue

Post by biscuit » Mon Aug 13, 2018 4:08 pm

Thanks for the response.

We are planning to sell the property after the tenant leaves. In that case, would you really let the tenant leave without any penalty for lease break?

If not the rest of the lease amount, how much would you charge them? It doesn't make sense to let them leave without any penalty. I had to break an apartment lease a few months ago and I had to pay the full lease amount when I broke the lease (I had 3 months left in the lease).

tesuzuki2002
Posts: 432
Joined: Fri Dec 11, 2015 12:40 pm

Re: Rental House Issue

Post by tesuzuki2002 » Mon Aug 13, 2018 6:41 pm

biscuit wrote:
Sun Aug 12, 2018 9:19 pm
We have a rental house approx. 5 hours from where we live. I got to know a few days ago that the current tenant is breaking the lease and moving out 4 months before the lease term ends. Now, I got to know this news only after contacting my property manager for some other thing even though she knew the tenant move out a couple of weeks ago.

We have multiple issues with the property manager and our plan is to get out of this rental nightmare after this lease ends. Looks like my property manager and the tenant became friends and without even informing me, the tenant and property manager had discussion(s) about finding another tenant to replace the current one.

My property manager is telling me that the tenant is willing(?) to pay $500 sublet fee when the agreement doesn't have any early termination options (Language in the agreement -Tenant is not entitled to early termination due to voluntary or involuntary job or school transfer, changes in marital status, loss of employment, loss of co-tenants, changes in health, purchase of property, or death). The house is located in TX.

My questions:
1. I have already communicated my properly manager the terms in the agreement. However, what other steps/precautions I can take now?
2. I no longer trust my property manager. Can I tag along during move-out walk-through?
3. How to find a good realtor from long distance to sell the house?
4. Have anyone used Redfin for selling your house before? If so, would you recommend them?
5. Anything else I need to know reg. selling house from long distance?
I manage my property from across the country... I learned property mangers in my area just want money and are also incompetent.... It is a bit extra work to handle things, but I have a system, I'm place now and it works out fairly well.

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knpstr
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Location: Michigan

Re: Rental House Issue

Post by knpstr » Tue Aug 14, 2018 7:57 am

biscuit wrote:
Mon Aug 13, 2018 4:08 pm
Thanks for the response.

We are planning to sell the property after the tenant leaves. In that case, would you really let the tenant leave without any penalty for lease break?

If not the rest of the lease amount, how much would you charge them? It doesn't make sense to let them leave without any penalty. I had to break an apartment lease a few months ago and I had to pay the full lease amount when I broke the lease (I had 3 months left in the lease).
Tenant's Rights Pamphlet published by Texas Tech in regards to tenants leaving early:
In any case, you should at least provide the landlord notice of your intentions to leave because you should receive credit for any rents collected after you move and another tenant has replaced you. Providing notice may enable the landlord to find another tenant before you actually move out. Your landlord has the duty to mitigate damages if you abandon your residence in violation of your lease. You can also find someone else to rent your place to practically eliminate your
liability, as long as the landlord finds him or her acceptable. However, landlords can charge you a reasonable “reletting fee” for having to prepare the dwelling for reletting and having to redo paperwork. The reletting fee must be a fair amount to cover actual expenses and cannot be unfairly inflated (you cannot be “penalized” for breaking a lease).
It sounds to me like your property manager is following the law perfectly. You just need to communicate to them that you don't "want" a replacement tenant. So in this case, I'd just say to attempt to negotiate a "early lease termination" fee, but 4 months rent is likely an excessive charge. Try to get an extra 1 or 1.5 months rent and put the house up for sale sooner. Really this early lease termination fee should have been put in your initial lease. But maybe your property manager can convince the tenant to pay more than $500.
Very little is needed to make a happy life; it is all within yourself, in your way of thinking. -Marcus Aurelius

Tal-
Posts: 326
Joined: Fri Apr 22, 2016 10:41 pm

Re: Rental House Issue

Post by Tal- » Tue Aug 14, 2018 8:47 am

I'm sorry that this hasn't treated you poorly. While early terminations are pretty common, I'm aghast at the property manager (PM) taking such liberties, and apparently putting the interests of the tenant before yours as the owner. That's bad juju, and parting ways with the PM is a good idea.

Good PMs are hard to find, and unfortunately, bad PMs aren't...

I also agree that selling is the right call for you.
biscuit wrote:
Sun Aug 12, 2018 9:19 pm
1. I have already communicated my properly manager the terms in the agreement. However, what other steps/precautions I can take now?
The suggestion above to keep things in writing is a good one. I'd add that you need to be clear and decisive... if you're being ambiguous, some PM's will take liberties to solve problems.
biscuit wrote:
Sun Aug 12, 2018 9:19 pm
2. I no longer trust my property manager. Can I tag along during move-out walk-through?
Yes - as the owner - you can be as involved as you like. In fact, if the PM is showing signs of putting the tenants interests before your own, I would micro manage all aspects of the move out process, including any sublet deals or fees.
biscuit wrote:
Sun Aug 12, 2018 9:19 pm
3. How to find a good realtor from long distance to sell the house?
Referrals. Plain and simple. If you don't know anyone you trust in that market, ask a real estate agent that you trust in a different market for a referral... they get a sizable referral fee for doing so, and should be happy to help with some due diligence.
biscuit wrote:
Sun Aug 12, 2018 9:19 pm
4. Have anyone used Redfin for selling your house before? If so, would you recommend them?
No direct experiences, but I've heard a lot about it. It seems to be a low cost, low service option - and the option survives on volume rather than price. I wouldn't personally use them, but if you think the agent can't provide value to the process and you simply want to control your costs, I think that it's a fine option.
biscuit wrote:
Sun Aug 12, 2018 9:19 pm
5. Anything else I need to know reg. selling house from long distance?
Selling isn't more difficult than being a landlord. In fact, I've found that real estate agents typically provide far better service than a PM, so selling may actually be *easier*.

Be sure you find an agent who can be involved in the necessary repairs. Many agents stay 100% hands off on those, but if you're 5 hours away, you probably want an agent that can either play middle man, or play general contractor.

Just be sure to interview 2-4 RE agents, and find one that you trust. You'll need to spend money to sell the house, and you'll need to rely on the RE agent regarding how to spend that money.
Debt is to personal finance as a knife is to cooking.

clutchied
Posts: 548
Joined: Mon Jan 05, 2015 12:11 pm

Re: Rental House Issue

Post by clutchied » Thu Aug 16, 2018 9:07 am

runner3081 wrote:
Sun Aug 12, 2018 10:16 pm
I would fire the property manager now. Take over self-management for the move out, finding a new tenant and move in. After that, hire a new property manager that you have vetted during the time period of finding a new tenant.
5 hours away...

knightrider
Posts: 247
Joined: Fri Jun 06, 2014 11:20 am

Re: Rental House Issue

Post by knightrider » Thu Aug 16, 2018 9:28 am

I would suggest posting this question on the landlord proection agency forum. google "lpa forum".

runner3081
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Re: Rental House Issue

Post by runner3081 » Thu Aug 16, 2018 10:24 am

clutchied wrote:
Thu Aug 16, 2018 9:07 am
runner3081 wrote:
Sun Aug 12, 2018 10:16 pm
I would fire the property manager now. Take over self-management for the move out, finding a new tenant and move in. After that, hire a new property manager that you have vetted during the time period of finding a new tenant.
5 hours away...
I based that on your comment about wanting to be there for the walk-through.

GreenGrowTheDollars
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Re: Rental House Issue

Post by GreenGrowTheDollars » Thu Aug 16, 2018 11:43 am

You aren't ok with the lease being broken because a tenant died? :shock:

biscuit
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Re: Rental House Issue

Post by biscuit » Thu Aug 16, 2018 1:13 pm

GreenGrowTheDollars wrote:
Thu Aug 16, 2018 11:43 am
You aren't ok with the lease being broken because a tenant died? :shock:

That's not what's happening with my tenant. I copy pasted the legal terms in the agreement that contains such language. Please read through the information before answering.

TropikThunder
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Re: Rental House Issue

Post by TropikThunder » Thu Aug 16, 2018 1:22 pm

biscuit wrote:
Thu Aug 16, 2018 1:13 pm
GreenGrowTheDollars wrote:
Thu Aug 16, 2018 11:43 am
You aren't ok with the lease being broken because a tenant died? :shock:

That's not what's happening with my tenant. I copy pasted the legal terms in the agreement that contains such language. Please read through the information before answering.
No, that’s not what’s happening with this particular tenant. But Green is referring to the fact that the language in your lease agreement prohibits early termination even in cases of death, which seems harsh and logically unenforceable.

TropikThunder
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Re: Rental House Issue

Post by TropikThunder » Thu Aug 16, 2018 1:30 pm

knpstr wrote:
Tue Aug 14, 2018 7:57 am

Tenant's Rights Pamphlet published by Texas Tech in regards to tenants leaving early:
Your landlord has the duty to mitigate damages if you abandon your residence in violation of your lease.
Does anyone know how the landlord’s duty to mitigate losses applies if the property is listed for sale? For example, if a tenant abandons their apartment today, and the landlord finds a new tenant to move in September 1, the departing tenant can only be held liable for the rent through September 1 plus a reasonable reletting fee which should be specified in the lease. If instead the property owner decides to sell, and it takes 6 to 8 weeks to prepare the property, find a new buyer and close on the sale, can the departing tenant be held liable for that entire time period?

clutchied
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Re: Rental House Issue

Post by clutchied » Fri Aug 17, 2018 7:48 am

runner3081 wrote:
Thu Aug 16, 2018 10:24 am
clutchied wrote:
Thu Aug 16, 2018 9:07 am
runner3081 wrote:
Sun Aug 12, 2018 10:16 pm
I would fire the property manager now. Take over self-management for the move out, finding a new tenant and move in. After that, hire a new property manager that you have vetted during the time period of finding a new tenant.
5 hours away...
I based that on your comment about wanting to be there for the walk-through.
I mean sure but you're taking how many days off work to get through all of that? Do you own rentals? I'm just curious because 5 hours away and having everything perfectly timed to meet your schedule seems a bit wishful.

Just basing off of experience. Rentals are an intermittent time sink and having to drive 5 hours each time; even to setup the team is pretty consumptive.

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knpstr
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Location: Michigan

Re: Rental House Issue

Post by knpstr » Fri Aug 17, 2018 12:45 pm

TropikThunder wrote:
Thu Aug 16, 2018 1:30 pm
knpstr wrote:
Tue Aug 14, 2018 7:57 am

Tenant's Rights Pamphlet published by Texas Tech in regards to tenants leaving early:
Your landlord has the duty to mitigate damages if you abandon your residence in violation of your lease.
Does anyone know how the landlord’s duty to mitigate losses applies if the property is listed for sale? For example, if a tenant abandons their apartment today, and the landlord finds a new tenant to move in September 1, the departing tenant can only be held liable for the rent through September 1 plus a reasonable reletting fee which should be specified in the lease. If instead the property owner decides to sell, and it takes 6 to 8 weeks to prepare the property, find a new buyer and close on the sale, can the departing tenant be held liable for that entire time period?
No,the rental period would end when the house was listed for sale. Since in this case the seller wants it to sell it as a non-rental. Otherwise the property could be sold with a tenant in it.
Very little is needed to make a happy life; it is all within yourself, in your way of thinking. -Marcus Aurelius

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