Tenant Moved Out Leaving Other 2 Roommates Stuck with the Lease and Rent...What Action Can I Take as Landlord???

Question

I own a 3 bedroom rental property on campus in Columbus, OH and have 3 guys signed to a 12 month lease that expires in July 2014.  Monthly rent is $1200 ($400/tenant) and there was a falling out with one of the roommates and he decided he was going to move out in January and apparently the other 2 tenants said they would find a sub-leaser to fill his void for the remainder of the lease term.  HOWEVER, they have still not found someone to sublease and if they don't have someone by Feb. 1 I am afraid they aren't going to be able to cover the full rent of $1200 and they have already threatened to just move out too if they can't find someone and can't afford the $1200.

I have never run into this issue before and it seems completely messed up to me that they think they can just walk away from a legally biding agreement that we all signed as a 12 month lease for $1200 per month.  Any suggestions on how I should handle this?  How can I stop the tenants from just walking away from the lease, moving out, and not paying me anymore rent even though they signed a lease until July?

Really need some help on this one so let me know what you would do in my situation!  Thanks

Dustin

Jake Kucheck · Answer

I think you need to adjust your mentality as a landlord.  Even with the best of screening procedures, leases in C markets are an educated guess as to what will happen, not the legally binding contract you purport them to be.  This is because your recourse is limited with people who don't care about (or don't know about) FICO scores, credit reporting bureaus, judgments, etc.  The threat of not being able to use you as a reference is also no longer credible if you're seeing this sort of behavior.  Maybe your college students are a better tenant profile than the composite of my Columbus portfolio, but maybe they aren't, either.

Encourage the remaining tenants to cover the delta.  If they are unable to, evict them.  If they leave of their own volition, then that saves you the trouble/cost of the eviction.  Then, find new tenants.  Lather, rinse, repeat.  Remember that you aren't the only landlord who has these issues, and you might just find better tenants the next go round.

As an aside... I had this happen to me in college.  I was paying $700/mo, as was my roommate, and the guy in the master who was supposed to pay $900/mo decided it wasn't for him.  I'm actually still really good friends with that guy, in part because he was up front about it.  We put an ad on Craigslist and had a Swedish foreign exchange student join us, and he actually paid $50 more a month because he wanted to guarantee he'd be chosen, decreasing each of our rent by $25/month.  It was kinda awesome, and Swedish dudes drink like there won't be a hangover tomorrow.  If I were you, I'd talk to the provost/administration and see if you could get a list of all the freshman who are being kicked out of their on-campus housing  for whatever reason.  They gotta live somewhere, right?

Pam R. · Answer

Hi Dustin. The sit-down is your best bet. Find out what they've been doing to fill their spot. I did a quick look, and did not see that they had a posting on Craigslist or the Lantern (or I didn't recognize it), which suggests they are limiting their search to friends. A very serious conversation of the consequences of an eviction and/or a financial judgement on their future job prospects might be sobering. You're a better judge of whether these are the type of kids who worry about that.

I've known a couple of people whose parents covered rent of departing roommates - without them being co-signers. That's another angle you should take - they should call their parents for help. Most kids parents don't want to find their son moved mid-way through the semester, are now living in someone's illegal basement bedroom, broke their lease, and are being sued.

Based on your location and your price and the student move-in/out flow...your place will almost definitely sit empty until at least May 1, probably June 1, if they leave. Would you rather accept the $800 for 3-4 more months, and make them move out a couple of months early as a trade-off? You could probably lease it now for a June 1 move-in at your full price for a 14-month lease.

Personally, I would work out a deal (if push comes to shove) for them to pay $800, and move out May 15th so you can have it ready for a June 1 tenant.

John Rooster · Answer

You can't make anyone do anything. All you can do is collect as much information as possible about them now so that if they leave, you can locate them to serve them. Then you can get a judgment against them. Having a judgment against three college grads is a pretty good judgment in the spectrum of ex tenant judgments. It might take 2, 4 or 10 years, but some day you will locate one of them on Linkedin or MyFace, boom goes the garnishment.

John Miller · Answer

Dustin,

I glad for you it worked out.

What I suggest for the next time (as there will be other times as long as you are a landlord) since the property is located in Ohio. Get your self a copy of the Ohio Revised Code Title 53 chapter 5321- Landlord & Tenants. This legal document will spell out all of your rights and tenants rights. You can find it on line.

Pam R. · Answer

Hi Dustin. Where on campus exactly? I own a property on north campus and lived there for 15 years - I'll be better able to give you ideas if I know if you are actually talking about "campus", or north or south of campus.

Dustin Faeth · Answer

Yes these are OSU students, and No I didn't have any of their parents co-sign on the lease....I will definitely do this on future leases for this property though to help protect myself from this happening again.

Chris Weiler · Answer

Enforcing the lease is a huge pain. I would have them move out in Feb without a fuss. The last thing you want is your place trashed and/or them abandoning and leaving the front door open (both have happened to me). It sucks, but that's the life of a landlord.

Adam Roberts · Answer

Man this post reminded me of being in college and having a room mate do this to us.....    we were able to find someone, however we had to fork over his share of the rent for 3 months while we searched.

You didn't specify, but I assume these are students (OSU)?  Did you require their parents to guarantee the leases?  I remember having to do that back in the day.

Account Closed · Answer

I agree with @Chris Weiler . You have a lease that you can get a judgment on, but it really isn't worth all the trouble, time and money. It will likely cost you more to pursue it than to just let them move out and get new tenants. He is right, if they are angry, they are more likely to cause damage to your place.

Dustin Faeth · Answer

Great info Josh!  Thanks I will check this out...much appreciated.

Tenant Moved Out Leaving Other 2 Roommates Stuck with the Lease and Rent...What Action Can I Take as Landlord???

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