Help with property management company that won't pay me and are ignoring my emails

[Jae Yoo]

I am truly at a loss for words here. My experience with a property management company has been overwhelmingly negative. I inherited their services when I purchased a sec8 rental property and initially decided to keep them, assuming it would be the simplest solution. However, I quickly came to regret that decision.

The company consistently ignores my emails and phone calls, often promising a callback that never comes. In desperation, I even visited their office in person, only to have my concerns dismissed and another empty message taken. Their practices are neither transparent nor honest, and I would not recommend their services to anyone.

I have money owed to me and they have not sent an ACH even though they have my routing information. Is this even legal? They take their portion of the housing voucher like clockwork and my funds are tied up in their system. I am not quite sure what they are doing with my portion at this point. Do I need to seek legal counsel? I'm up on my second mortgage payment and I am starting to get worried. Would contacting the state be a good move? Or legal counsel? Any assistance would be greatly appreciated. 

[Drew Sygit]

@Jae Yoo you have a few options:

1) Hire an attorney to write a threatening letter. Be prepared to start a lawsuit.

2) File a complaint with state's Board of Realtors

3) File a complaint with state's Attorney General's office

Since these are unlikely to be permanent solutions, you'll also want to start searching for another PMC.

Recommend you speak with @Russell Brazil

[Bruce Woodruff]

I agree with @Drew Sygit Do all 3 of these options, and find a new PM company right now. Do not give them a second chance.

[Adam Bartomeo]

We would need a lot more information... is this a month or months? When switch ownership there are sometimes issues. Often the owner provided the wrong account or routing info. To process a new owner payment the system takes an extra week or two. We often mail out the first check when we encounter these situations. 

I would be very surprised if they are just keeping your money. The lack of communication is typical in this business and a reason why we opened and have done well. 

[Russell Brazil]

Quote from @Drew Sygit:

@Jae Yoo you have a few options:

1) Hire an attorney to write a threatening letter. Be prepared to start a lawsuit.

2) File a complaint with state's Board of Realtors

3) File a complaint with state's Attorney General's office

Since these are unlikely to be permanent solutions, you'll also want to start searching for another PMC.

Recommend you speak with @Russell Brazil

 Thanks for the tag.

Property Management is not a licensed activity in the state of Maryland. So it can be a bit of the wild west. Unscrupulous Property managers in Baltimore is unfortunately par for the course. The suburbs have a number of good PM companies, but due to the low price points and rents, and the nightmare of dealing with the city and courts there, most of the good property managers in the general area won't touch Baltimore. That ends up leaving a void that's filled by unprofessional, and in some cases outright criminal operations there in the PM space.

[Tim Jacob]

It sounds like you have a bad pm if they are ignoring when you are trying to contact them.  I would wonder if the previous owner owed them money and they dont believe ownership changed.  A lot of times it is best if the existing pm is the listing agent so they can negate this along with tenant communications.  Did you receive security deposits with interest and pro rata rent for the month at settlement?

The pm could also  be very unethical.  They should atleast be communicating with you.  It would be helpful if you had your settlement papers.  When sdat and city taxes updates there will be no question though that could take months.

A lot of the better pms void this by only managing in the better parts of Baltimore city or the suburbs.  There they have a much higher likelihood to get tenants who will pay not to mention respect the property and make things easier for everyone.  If you are in a lower asset class things can go the other way.  A lot of voucher tenants actually can afford to not live in the worst parts of Baltimore but won't live in the best either.  Thus you might be able to find someone.  As things get more difficult more and more and just staying higher end.  If you go too low I would either recommend self managing or liquidate it.  The best lower end property landlords self manage.  The best way to look at things is the amount of hastle and money the pm will make.  In low end properties they dont make enough and they also take on considerably more risk.  

If you can share the address it could answer some questions.

[Jae Yoo]

@Tim Jacob

Thank you so much for your response. The property is in Joseph Lee and in the 250k range (but it is a duplex) The PM is downright awful. Your take on self-managing has me thinking about it a lot. I actually had to make calls to fix the heat and broken doors and connected with the tenants 1 on 1. This way I can also control the maintenance cap/ex aspect. I understand this is part of the learning curve, and once I can have the PM "release" me, I might consider it and save 3k/yr!

[Jae Yoo]

@Russell Brazil

Thank you for the insight. The void is real.