Rental Property Investor · Modesto, CA · Member since 2019 · 15 posts · 4 votes
I have a problematic tenant that was inherited.
He pays one month's rent every 3 months or so... When I bother him enough. He owes me now about 6 months. In California, our wonderful Gobernador enacted a Pandemic eviction moratorium, where Courts are not evicting people unless they are a danger for the community and if a Judge sides with you to overrule the moratorium. I have gone this way with a junkie on a different property.
I pay for water, sewer, and garbage.
I was able to get him to sign a new lease agreement for 6months that converted to a month to month on Jan 1, 2021. On the lease, it stipulates Garbage is to be paid for by the tenant.
My question is what can I do?
This is what I have been thinking, Please let me know if this is correct and any other suggestions.
1. Send all his past dues, not to a collection agency
2. Cancel Garbage (only $36 per month) and at least save that.
3. offer cash for keys. I don't think he will take it... Might be if I offer full 3 months of rent and wipe past dues not paid.
4. Is there any way to get Cares Act money to cover this tenant, without the tenant's cooperation.
Since He does not respond to my texts, I don't have a good communication channel, other than sending mailers and text messages that don't get answered.
One concern I have is that this is a duplex and the tenant can decide to fill the yard with junk and cause problems for my other tenant.
Rental Property Investor · Northern, CA · Member since 2012 · 5k+ posts · 5k+ votes
5y
@Luis Limon As it sounds like you're already aware, the Governor signed another new bill (SB91) into law last week that extends the previous tenant protections enacted under AB3088 (the COVID-19 Tenant Relief Act of 2020). SB91 not only extended some of the previous tenant protections, it also added some new ones. On a positive note though, it does provide an opportunity for landlords to get direct rental assistance for past due rent. I actually made a post about this last week in this post the day the Governor signed it.
In any event, I actually went to some training on this new law (SB91) recently since these new laws tend to be very complex and I like to stay educated on them. So I'll try to answer some of your questions.
1. Regarding sending the tenant's debt to collections = SB91 prohibits the sale or assignment of all COVID-19 rental debt (amounts due between March 2020 and June 2021) until July 1, 2021. After July 1, 2021 you MIGHT be able to turn it over to a collection agency (it depends on whether the tenant meets certain eligibility criteria).
2. Regarding cancelling of garbage service = I have rentals serviced by multiple different garbage companies and none of them would even allow me to cancel garbage service. (Would the garbage people be expected to check every address to see if they're paying before they picked up their garbage?) So I don't even know if that's a realistic option. But even if you were allowed, I don't think it's a good idea. Especially given that your property is a duplex. Do you really want the garbage to not be picked at just one of the sides?
3. Regarding the idea of cash for keys = Might be a good idea in this scenario given our current political/legal climate. I know there's people who are against the idea of paying a non-paying tenant to leave, and honestly I used to be too. However, I've come to realize it's just a business decision. Would you rather pay someone two months rent to move away? Or allow them to stay in your property rent-free for 6 more months? If you look at it as a business decision, and not an emotional one, the answer should be clear.
4. Regarding how to get money without the tenant's cooperation = While the exact process for landlords to apply for these funds still has yet to be ironed out, it's not likely that you will be able to do it without the tenant's cooperation. Eligibility is based on the tenant's circumstances/income level and they will almost certainly have to submit something in the form of proof of income in order for the landlord's application to be processed/approved.
Ultimately, like with most of the other tenant protection laws that have passed since COVID started, this isn't for the casual hobby landlord. You'll likely need professional legal assistance, as there are a lot of complexities and nuances to this new law.
(Pay special attention to the deadline mentioned of February 28th by which you MUST provide a specific Informational Notice to any tenant who is behind on rent as of February 1st. If you fail to provide this notice, you will NOT be able to serve any new 15-day notices until you have complied with this requirement.)
In the end, I would suggest following @Chad Hale 's advice and getting an experienced local landlord-tenant attorney to guide you through this process, as it is now more difficult than ever for a landlord to go at it on their own.
Property Manager / Investor · San Jose, CA · Member since 2013 · 779 posts · 301 votes
5y
@Luis Limon call a local eviction attorney and have them walk/guide you through the ever changing eviction process. They'll know the mood(s) of the courts/judges and be the best people to give you sound advice for your specific situation and jurisdiction. Now is not the time to do these types of things on your own.
Rental Property Investor · Northern, CA · Member since 2012 · 5k+ posts · 5k+ votes
5y
@Luis Limon As it sounds like you're already aware, the Governor signed another new bill (SB91) into law last week that extends the previous tenant protections enacted under AB3088 (the COVID-19 Tenant Relief Act of 2020). SB91 not only extended some of the previous tenant protections, it also added some new ones. On a positive note though, it does provide an opportunity for landlords to get direct rental assistance for past due rent. I actually made a post about this last week in this post the day the Governor signed it.
In any event, I actually went to some training on this new law (SB91) recently since these new laws tend to be very complex and I like to stay educated on them. So I'll try to answer some of your questions.
1. Regarding sending the tenant's debt to collections = SB91 prohibits the sale or assignment of all COVID-19 rental debt (amounts due between March 2020 and June 2021) until July 1, 2021. After July 1, 2021 you MIGHT be able to turn it over to a collection agency (it depends on whether the tenant meets certain eligibility criteria).
2. Regarding cancelling of garbage service = I have rentals serviced by multiple different garbage companies and none of them would even allow me to cancel garbage service. (Would the garbage people be expected to check every address to see if they're paying before they picked up their garbage?) So I don't even know if that's a realistic option. But even if you were allowed, I don't think it's a good idea. Especially given that your property is a duplex. Do you really want the garbage to not be picked at just one of the sides?
3. Regarding the idea of cash for keys = Might be a good idea in this scenario given our current political/legal climate. I know there's people who are against the idea of paying a non-paying tenant to leave, and honestly I used to be too. However, I've come to realize it's just a business decision. Would you rather pay someone two months rent to move away? Or allow them to stay in your property rent-free for 6 more months? If you look at it as a business decision, and not an emotional one, the answer should be clear.
4. Regarding how to get money without the tenant's cooperation = While the exact process for landlords to apply for these funds still has yet to be ironed out, it's not likely that you will be able to do it without the tenant's cooperation. Eligibility is based on the tenant's circumstances/income level and they will almost certainly have to submit something in the form of proof of income in order for the landlord's application to be processed/approved.
Ultimately, like with most of the other tenant protection laws that have passed since COVID started, this isn't for the casual hobby landlord. You'll likely need professional legal assistance, as there are a lot of complexities and nuances to this new law.
(Pay special attention to the deadline mentioned of February 28th by which you MUST provide a specific Informational Notice to any tenant who is behind on rent as of February 1st. If you fail to provide this notice, you will NOT be able to serve any new 15-day notices until you have complied with this requirement.)
In the end, I would suggest following @Chad Hale 's advice and getting an experienced local landlord-tenant attorney to guide you through this process, as it is now more difficult than ever for a landlord to go at it on their own.
Rental Property Investor · Member since 2020 · 1k+ posts · 1k+ votes
5y
This sounds like a bad situation with no end in sight. Generally I am against cash for keys however in certain areas like California it is your only option but I don't know why a tenant would agree. I predict they will be able to stay for a long time, maybe even until 2022 before there are any updates. I do feel that under the covid moratoriums you do have to demonstrate you have no way to pay and this should include government relief that would pay your landlord. If they don't qualify for govt money or just refuse to take it they clearly are not affected and need to move on by eviction if necessary. As for the garbage, they are going to generate trash no matter what. If you cancel they are most likely going to just use the neighbors cans causing issues or start their own trash heap. It has to go somewhere and it will be cheaper for you in the long run for it to be hauled off by waste management than you dealing with the aftermath.
He pays one month's rent every 3 months or so... When I bother him enough. He owes me now about 6 months. In California, our wonderful Gobernador enacted a Pandemic eviction moratorium, where Courts are not evicting people unless they are a danger for the community and if a Judge sides with you to overrule the moratorium. I have gone this way with a junkie on a different property.
I pay for water, sewer, and garbage.
I was able to get him to sign a new lease agreement for 6months that converted to a month to month on Jan 1, 2021. On the lease, it stipulates Garbage is to be paid for by the tenant.
My question is what can I do?
This is what I have been thinking, Please let me know if this is correct and any other suggestions.
1. Send all his past dues, not to a collection agency
2. Cancel Garbage (only $36 per month) and at least save that.
3. offer cash for keys. I don't think he will take it... Might be if I offer full 3 months of rent and wipe past dues not paid.
4. Is there any way to get Cares Act money to cover this tenant, without the tenant's cooperation.
Since He does not respond to my texts, I don't have a good communication channel, other than sending mailers and text messages that don't get answered.
One concern I have is that this is a duplex and the tenant can decide to fill the yard with junk and cause problems for my other tenant.
I have a rental property in California as well, and so far my tenants have not missed rent. They are 3 millennials, which I think is a great tenant profile for this pandemic. They are very driven and are not afraid to hustle with various side gigs. I also have a rental in Las Vegas and the tenant was only short one month rent by $30, but she got back current the following month.
By the way, the eviction moratorium is mandated by the CDC. Governors are merely following the CDC mandates and guidelines. So don't waste energy blaming governors for the fallout of the pandemic. If the previous administration had a more robust, science-based, and well coordinated Covid-19 response we would all be in a much better shape today.
I travelled to Australia and a few APAC countries late last year and was very impressed with the way they have responded to this pandemic and opened up their economies, while still keeping their population safe through a well structured set of Covid-19 protocols. I also felt a little angry (and embarrassed) as I know that the only thing that stopped us from being in a better position today was the total lack of competent leadership, not a lack of resources or scientific know-how.
Hang tight, as help is on the way to right this ship.