Acquiring someone else tenants through new purchase

[Erica L.]

I finally made 2 deals... in one week!!!! WOOOHOO!!!  :)

However, the one is a duplex and I'm super weary of acquiring someone elses tenants. The place looked clean and taken care of - but if they don't pay, I don't really care how good they take care of it - they need to go. I asked for proof of payment and the current owner gave me Venmo transfers into their bank account (NOT VENMO TRANSFERS TO THEM FROM OTHERS). It sounds like there hasn't been default payments but as of now, thats word of mouth... and their lease is only one page -  I asked for better proof but they haven't gotten back with it yet.

Needless to say, one is on a month to month and the other ones lease expires in September 2021. The property is in NJ where I believe there are eviction holds in place. If they're not willing to sign a yearly contract under my terms (the current lease is one page!), can I immediately give notice to vacate to the 'month to month' renter.... and what can I do with the one thats lease expires in September? Honestly, the rents are under FMR and I can def value add to both units to justify the increase in rents - would probably need to find new renters though.

Never acquired renters, please advise... :)

[Patrick M.]

@Erica L. I would familiarize yourself with NJ's anti-eviction statute and the pertinent case law surrounding any issues regarding lease renewals, etc. You say you finalized 2 deals and one is a duplex. If the other is a residential rental and you are not living in it you can be subject to the anti-eviction statute. SFH and Duplexes are exempted unless you hold 3 units or more combined and don't reside there. Tenants may never know- but it can be discovered.

As others have said, the Venmo app will have the transfers on.

I would make sure that you have 1 and a half months security deposit per unit and if not I would want to know why. Many small landlords will start dipping into deposits to make up late or missed rent, regardless of the rules. That will be your 1st indicator.

As to the new leases, what does it entail? Be certain you can change things you intend to change (pets can't be changed to no pets if they have one). And also ask yourself this- Do I need to have a new lease signed now?

If it were me I would hold my cards close to my chest. This is not the time to upset a regular paying tenant whether you like them or not. They will see the writing on the wall and start saving their rent payments for their next residence and their is not a damn thing you can do about it except get yourself in a tizzy for naught.

"The property is in NJ where I believe there are eviction holds in place." 

Oh, you believe correctly, but unlike other states ours doesn't end until at least 60 days after the governor says the state of emergency is over. When is that going to be? And it will certainly be extended.

"Worse case scenario, I have to start the eviction process and pay their rent for a couple months. I know in Jersey it can take up to 6 months to go through the eviction process but we’re willing to take the risk."

Six months from when? For what benefit? I cannot stress this enough... take it easy, If they are paying and good tenants- leave it at that until the moratorium is over and the backlog is down.

I speak from the experience of inheriting horrible tenants with some crappy "one page photo-copied-fill in the blanks lease" which each was violating in one way or another. 

If everyone is paying then I wouldn't say anything about lease changes, rent increases, non-renewals, etc. until you can enforce them. They have no relationship with you and will not hesitate in keeping their money rather than give it to some stranger who they believe is going to push them out anyway.