Tenant has paid deposit and signed lease but is now incognito

[Mark Eldridge]

Hey Everyone,

This is a new one for me and I’m not quite sure what the best way to go about it is. My current tenants gave me their notice to vacate and I started the process of finding tenants for when they move out. I found my potential tenants that every seemed great and checked out. We signed the lease and they handed over their security deposit back in late March for a May 1st start date. I have been trying to get a hold of them via cellphone and email the last two weeks leading up to the start of the lease date and have not made any contact regarding meeting to hand over the keys and collect first months rent and ensuring that the electricity had been changed into their name. 

Has anyone had this happen where the contract was signed and the deposit was held but they didn’t move in? Do you still have to go through an eviction process since they have not gotten the keys or moved in? I would imagine they will reach out within the next day or two, but want to be prepared if may 1st comes and there’s still no contact.  Anyone’s thoughts or experiences would be very helpful  

Thanks,
Mark

[Scott M.]

I think local rules may dictate your answer here and this may not be useful to you, but maybe others who are reading this.  We never have a tenant sign a lease prior to the move-in day.  We always collect money upfront but have a separate contract that covers what happens with that money.  If they move-in as expected this happens.  If they don't, that happens.  And that includes a non refundable deposit (guided by state law) if they don't.  We also say that until they move in the home will be marketed and shown.  We always try and have back up renters in place...not that you are asking about that.

Should they disappear, I would keep their funds set aside in case they do.  The SD will most likely need to be returned unless your state law allows it to be converted to unpaid rent then you might be able to keep the portion between May 1st and when you do get it rented.  

As this depends on state law, best to ask your lawyer his .02 so you know how to handle the SD.  Can get in trouble pretty quick by not handling that properly.  

To answer your question direct, we have had this happen in the past but because we had a contract regarding the funds given to us and how it would be handled in case this happened, it wasn't a big deal.  The balance of the funds we were to return, we just waited for them to surface, and they eventually did.