San Francisco, CA · Member since 2016 · 10 posts · 2 votes
Hi!
We purchased a duplex and after we closed, we spoke with some neighbors and found out that one of the tenants hadn't paid rent for a few months during their tenancy. We are currently verifying if what we heard from the neighbor is accurate information. If this is the case, what recourse do we have since it was not included in any disclosures during escrow.
Also, does anyone know of an attorney in Sacramento that deals with landlord/tenant issues?
I would consider that a material fact if the intention was clear that you were going to maintain this as a rental property, however if you do legal battle with them I don't know how much you'd realistically get.
If they don't pay rent to you you can start the eviction process. Did you get a tenant estoppel form that detailed the security deposit rent etc. when you purchased?
We did get the tenant estoppel but it didn't list anything. Our information was from a neighbor and we are currently trying to verify it. Do the sellers not have to disclose if the tenants had not paid rent in the past?
I would consider that a material fact if the intention was clear that you were going to maintain this as a rental property, however if you do legal battle with them I don't know how much you'd realistically get.
I’d play it out first before getting too worked up from hearsay. If the landlord gave you documents (including the estoppel) than you may be able to do something if this what you find when you officially start collecting.
Who knows what is really going on until you start collecting the rents and seeing first hand how the building operates.
Just do all the necessary paperwork to let the tenants know your the new Sheriff in town and see how it plays out for you.
Was the property professionally managed? Even if it wasn't, your agent should've asked the seller to provide proof of deposit for the previous 12 months. In commercial multifamily this is known as "the trailing twelve" and it would've shown that the tenant had not paid rent on time for some of the previous months. This is part of your due diligence as a buyer. An agent experienced in negotiating multifamily deals in Sacramento could've helped you with that.
Even if the seller did disclose you still have to honor the current lease in place, even if it's month to month. Plus, we all fall on hard times occasionally, so perhaps the situation was just temporary and the tenant will have no issues paying the rent from here on out. Best of luck.
@Michelle B. Is the tenant currently behind on rent or did you just hear that they previously may have missed some past payments at some point "during their tenancy"? It wasn't clear to me from the way you phrased it, and it's also kind of odd that you heard this info from a neighbor. Not sure how the neighbor would know that.
In any event, if they just missed or were late on some past payments during their tenancy, that's not something that would necessarily need to be disclosed to you. If the tenant was currently behind on their rent (i.e. in default on their lease), that's something that should have been captured on the estoppel certificate. But you say you got the estoppel and "it didn't list anything". Not sure if that means you didn't ask it or it was asked but not answered or it was asked but not answered truthfully. As you can see, it's hard for us to know what's going on based on what's posted. (If you used the CAR Estoppel Certificate form, it asks whether the tenant is currently in default under the terms of the lease.)
Ultimately, you own the property now so as @Jack Edgar jr suggested, just make contact with the tenant and explain you're the new owner and the new process for paying rent. If they don't pay, immediately serve a 3-day pay or quit notice and go from there.
And if you end up needing a landlord-tenant attorney in Sacramento, PM me and I can refer you to one of the most experienced ones in the area.