Dealing with an inherited tenant who won't pay

[Angel Riera]

Hey folks!

Just closed on my first multi thanks to all the info on this forum. Still very much in the process of learning this business. I inherited a tenant who has been avoiding me and did not pay rent for the month of June. I was about to start the eviction process after the legal grace period but was notified by the tenant that they were moving out July 12th so I didn't continue. Now they are claiming they gave a 2000 dollar security deposit, when on their signed lease and the estoppel certificate i was given it states they only gave 1000 dollars. So, again, they haven't paid June's rent and it seems that they aren't planning on paying prorated rent for July or any damages that are due either, because according to them it should be covered with the 2000 dollar deposit. The 1000 dollars credited to me for their security deposit when I closed is enough to cover June's rent, but not prorated rent or damages. What are my options here and is it even worth pursuing what's owed?

[Nathan Gesner]

Your options are to start the eviction process, continue hounding the tenant about it, or let it go. I would choose the latter.

The estoppel should be signed by the Tenant, the Seller, and you to ensure there is full agreement on the terms and conditions. Since the tenant is arguing there's a different amount for the deposit, they obviously were not involved in competing the estoppel which means it was done improperly and is pointless.

You only have $1,000 for the deposit and the deposit should not be applied towards anything until the tenant vacates and the lease is terminated. If you apply it towards rent, what will you use to cover cleaning and repairs? Even if it were applied to rent, it would be applied towards the last 30 days, which means he owns 12 days of June rent and then you would apply the deposit to June 13 - July 12.

I would give him a very short, written notice that you have $1,000 and he owes $XXXX to cover June 1 - July 12. The deposit will be applied towards cleaning and repairs after he vacates and you will forward any remaining funds to him in accordance with state law. Leave the ball in his court and move on. If he pays (he won't), that's great. If he doesn't, apply the deposit and mail him a notice of how much he owes. If he pays (he won't), that's great. If he doesn't, you decide whether to go after him in court or let it go.

In the future, make sure the estoppel is agreed to by the Landlord and the Tenant so there's no confusion.