You bought a tenant-occupied property but don’t know anything about property management
Uh oh. But it is not rare.
Let me start by saying that Managing your own properties starting out is the way to go.
Because you need to know the laws and what you can and cannot do as a landlord. Perhaps you have no interest in managing the properties yourself and plan to hire a management company immediately. *Warning*: If you don’t understand property management, you won’t know how to hire a property management company or if they are doing a good job. I am pretty sure when I say that most property management companies are not good.
Now, to the problem at hand: There is a tenant in your property!
1. When you purchased the property, you should have received tenant deposits and contracts from the previous owner. If you didn’t, you started badly. If the landlord says that he did not have any contracts or deposits with the tenant but the tenant says that he had a contract with the previous owner, ask the tenant for copies of the contract that he has. If they can’t produce a contract either, there’s nothing binding you to the above terms.
2. Hopefully you have received deposits from the tenant because when you move out you want something to cover the repairs you will need to do, plus you will be responsible for repaying any deposits they have paid that are not used to pay rent or utilities. damage. (even if they paid it to the previous owner who didn’t pass it on to you).
3. You are legally bound to abide by any prior leases and terms the tenants have (again, as long as you have a copy of these agreements). Consumer protection laws protect the tenant and bind them to their previous agreements until those agreements expire.
4. If there is no lease, send all tenants their new leases immediately. They are allowed to sign or move. You will then manage your property according to your terms.
5. Owning a property and managing tenants are two very different businesses. You must learn property management if you are going to have tenants. I wrote a book, The Essential Handbook for Landlords, available on Amazon, which is a great starting point.
You own the property, you are the one in charge. You need good contracts and it is essential that you know the local laws and how to manage tenants.
6. When you decide to hire a property management (PM) company, know that they manage by your paperwork and rules. I owned a PM business for years and most owners came with their own pre-signed contracts and rules. Some allowed pets, some didn’t; some allowed smoking, some didn’t, etc., etc. We enforced the owners rules. What you do with your property is up to you: the PM company enforces their rules (if the company is good…).
Property and/or tenant management goes back to contracts. And your local laws. Every state is different. Know your laws.
Also, owning rental properties is a business. When any tenant is “bad” even behind in payments, start the eviction IMMEDIATELY. I listen with compassion to their reasons, but the rules are the rules and I don’t bend them for any because if you give in to one, you must give in to all (consumer protection laws, again).
Have you ever bought a property with an established tenant?