We had a phone call today from a debt collector stating that we had not paid a gas and electricity bill totaling $450 from our IP - we are new to all of this! When we initiall purchased the property we had the utilities changed into our names however we presumed (never a good thing I know) that the tenants would change it all over to their name when they moved in. It seems that this is not the case and as we were having problems with the tenants paying rent they are no longer in the property (seems they didn't want to pay for anything!). What should we do?? What about the South East Water bill that I am sure we will be receiving soon..?
Debt collectors after me b/c tenants not paying bill!! Help!
- Thread starter Lilli
- Start date
There are a couple of issues here.
The bills are in your name so ultimately you are responsible. To protect your credit rating I suggest you pay them immediately and, at the same time, have the services in your name disconnected.
Usually the tenant connects services in their own name when they start a rental so there is no need to have them mentioned in the lease. In this case the tenants realised they were along for a free ride so obviously said nothing, and may well refuse to pay anything.
I think it may be that you have to chalk this one up to experience.
But pay those bills NOW - the longer it goes on the more fees and charges will be added.
If you want to charge the tenants for water you must have the property certified water compliant by a plumber and also have this mentioned specifically in the lease.
Marg
The bills are in your name so ultimately you are responsible. To protect your credit rating I suggest you pay them immediately and, at the same time, have the services in your name disconnected.
Usually the tenant connects services in their own name when they start a rental so there is no need to have them mentioned in the lease. In this case the tenants realised they were along for a free ride so obviously said nothing, and may well refuse to pay anything.
I think it may be that you have to chalk this one up to experience.
But pay those bills NOW - the longer it goes on the more fees and charges will be added.
If you want to charge the tenants for water you must have the property certified water compliant by a plumber and also have this mentioned specifically in the lease.
Marg
it might simply be an honest misunderstanding. if the accounts are in your name, the bills probably came with your name on the envelope. i don't open any mail that doesnt have my name on the envelope (unless it looks like it might be jammed full of cash).
i would recommend that you do pay the bills asap and then talk with the tenants before you disconnect everything. they might be willing to pay, but if they woke up one morning to suddenly discover everything has been cut off this goodwill might change rapidly. i know that if it was me, with a family, and my gas and electricity was cut off w/o notice or explanation, without the opportunity to make other arrangements i would be very, very upset.
so talk first, try to get them to live up to their fair share, explain that they will have to have the electricity/gas turned on in their name, and then have it cut off.
this was, i am sorry to say, more your fault than theirs. if i move into a house i am not going to start paying random bills in other peoples names.
finally, get a lawyer or someone to review your rental contracts. nobody benefits by these sorts of misunderstandings.
i would recommend that you do pay the bills asap and then talk with the tenants before you disconnect everything. they might be willing to pay, but if they woke up one morning to suddenly discover everything has been cut off this goodwill might change rapidly. i know that if it was me, with a family, and my gas and electricity was cut off w/o notice or explanation, without the opportunity to make other arrangements i would be very, very upset.
so talk first, try to get them to live up to their fair share, explain that they will have to have the electricity/gas turned on in their name, and then have it cut off.
this was, i am sorry to say, more your fault than theirs. if i move into a house i am not going to start paying random bills in other peoples names.
finally, get a lawyer or someone to review your rental contracts. nobody benefits by these sorts of misunderstandings.
I'd suggest you have 2 hopes of getting the money out of them Lilli. If the PM had a forwarding address you could send them a stern warning and imply it "may affect their credit rating" or seek legal advice (costly for the amount you're after).
As stated already, I suggest paying the bills sooner than later. These items will have already been reported to Austrac I would suggest (if in hands of collections agency) and as such will impact on your credit rating. I would get the PM to write a letter confirming the property was tenanted at the time of the bills falling due. this will give you something to work with should you wish to apply for finance in the next 7 years. At present most lenders will overlook utilities/telecommunications bills under $500 but the mortgage insurers are getting tougher and tougher in the current climate. this way you have some back up for your plausable explanation for any defaults showing.
If you haven't heard from the water company it would be an idea to contact them ASAP. It may not have gone to a collections Co yet.
I'm also wondering if you lived there before renting it out. Surely the service providers would have had a contact number for you when you hooked them up.
regards
Steve
As stated already, I suggest paying the bills sooner than later. These items will have already been reported to Austrac I would suggest (if in hands of collections agency) and as such will impact on your credit rating. I would get the PM to write a letter confirming the property was tenanted at the time of the bills falling due. this will give you something to work with should you wish to apply for finance in the next 7 years. At present most lenders will overlook utilities/telecommunications bills under $500 but the mortgage insurers are getting tougher and tougher in the current climate. this way you have some back up for your plausable explanation for any defaults showing.
If you haven't heard from the water company it would be an idea to contact them ASAP. It may not have gone to a collections Co yet.
I'm also wondering if you lived there before renting it out. Surely the service providers would have had a contact number for you when you hooked them up.
regards
Steve
Hi Lilli
We had something similar happen to Daughter and then again to us
In both cases we had notified the utility companies to disconnect, however they hadn't physically done so, and when the tenant arrived they just flicked the switch, the power was on, and they 'forgot' to organise supply for themselves.
In Daughter's case, the electricity came to $750 for one person living in a two bedroom townhouse ....
What we did:
We contacted the Service Centre and had the last bill handy, and a copy of the Lease. In each case the Service Operator asked us to fax a copy of the lease and an explanation. The utility company then accepted that someone else had been in occupation and credited us with the current bill.
We actually asked for the supply to Daughter's place to be disconnected but they cannot do that if they know that someone is in occupation. They have to give that person the chance to pay the bill.
After we had made these calls and faxed the information the matter was settled. I did call again later and had this confirmed.
With our case, I always connect and disconnect via email, and I was able to demonstrate our instructions by forwarding the previous email.
With regards to gas, the gas supply is not actually disconnected. A reading is taken when someone leaves and again when someone new arrives.
With regards to water, when a tenant leaves we usually receive a letter (from Yarra Valley Water) advising us that an occupant has left and until they are advised of another occupant that all water useage will be billed to the owner of the property.
After we had experienced these unpleasantnesses, we now email everything and confirm the change of use by phone the day the new tenants move in. I nearly always have power connected so that we can work at the place and am happy to pay the connection fee for this.
Hope this helps, but get straight on to it and have the bills and lease to hand when you make the call
Cheers
Kristine
Unfortunatly it's another lesson. I've found debt collectors to be very reasonable to deal with from both sides of the fence. I'm sure there crap ones out there but maybe we have been lucky.
Everyone has given good advice, I'll have to use some of it.
Thanks.
Regards
Graeme
You've learnt a lesson - some people, when moving into a house and finding the lights work, won't bother getting a 'proper' connection in their name. Always, ALWAYS make sure you have any active accounts closed at a house before you move out - whether you are renting, handing to a tenant or selling. And if you have an indoor meter make damn sure they've actually got into the house for a proper read, not an estimated or duplicated read.
When I bought my house the previous owner had rented it out. When I got my first electricity bill a few weeks after moving in (I had the meter reader out within a week or so of moving there so she had a true read) I got a $2000 bill. Turns out the tenants were just using electricity without an account.
I sent the electricity company the papers that said when I'd bought the house, they adjusted my bill pro-rata for the week or so between me moving in and them reading the meter, and they went chasing the previous owner for the outstanding amount using the address she'd put down on all the settlement papers. It was quite a painless process.
You, unfortunately, are just stuck with the bill as you didn't organise to get the power/gas disconnected when you moved out.
When I bought my house the previous owner had rented it out. When I got my first electricity bill a few weeks after moving in (I had the meter reader out within a week or so of moving there so she had a true read) I got a $2000 bill. Turns out the tenants were just using electricity without an account.
I sent the electricity company the papers that said when I'd bought the house, they adjusted my bill pro-rata for the week or so between me moving in and them reading the meter, and they went chasing the previous owner for the outstanding amount using the address she'd put down on all the settlement papers. It was quite a painless process.
You, unfortunately, are just stuck with the bill as you didn't organise to get the power/gas disconnected when you moved out.
utilities such as water, electricity and gas are not "physically" turned off when you disconnect.
what happens is that the new tenant moves in, and if the meter is running yet no one has rung to connect the utility company sends out a bill to "the occupier".
if no one pays the bill (or reminder or disconnection notices) or gets the service connected in their name, only at that stage do they "physically" disconnect. so if you arrange disconnection of the utilities today, they won't get turned off to the ip.
we're renting in a company paid house and didn't know if they company had also put on the utilities so we just waited for the "occupier" bills and then arranged connection - no problems.
unfortunately because you've left it on in your name, it's your bill. time to try and negotiate with the tenants, but they are fully in their right to refuse ot pay.
water bills always go to the property owner, and it has to be written in the lease that the tenants will pay the usage portion.
what happens is that the new tenant moves in, and if the meter is running yet no one has rung to connect the utility company sends out a bill to "the occupier".
if no one pays the bill (or reminder or disconnection notices) or gets the service connected in their name, only at that stage do they "physically" disconnect. so if you arrange disconnection of the utilities today, they won't get turned off to the ip.
we're renting in a company paid house and didn't know if they company had also put on the utilities so we just waited for the "occupier" bills and then arranged connection - no problems.
unfortunately because you've left it on in your name, it's your bill. time to try and negotiate with the tenants, but they are fully in their right to refuse ot pay.
water bills always go to the property owner, and it has to be written in the lease that the tenants will pay the usage portion.
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Yup.
Actually, I have something similar happening at the moment, lordy knows who is getting the bill for this - not even the Body Corporate knows
It is an apartment complex around 2 years old. We have got the electricty bill fixed; but everyone presumed that the water and gas bills are being done through the Body Corporate, as there are no individual meters (we do have individual electric meters). I certainly havent contacted anyone about water or gas when we settled; nor has the tenant, obviously.
Well, at the AGM another PM mentioned that none of his owners had received gas or water bills. Other owners that were there said they hadnt either, but the Body Corporate was paying for them. The Body Corporate Manager shook his head, Nope, the owners are. Nope, said the owners.
We still have gas, we still have water - so who, exactly is paying for it?
i've had once electricity disconnected due to some accounting stuff ups at energex
the actual disconnection in my case was electrician coming out, unscrewing the fuse and leaving it in switchboard
that was in a block of units with common switchboard located outside
don't know what they would do if it was located inside the property, remove the fuse on power pole?
the actual disconnection in my case was electrician coming out, unscrewing the fuse and leaving it in switchboard
that was in a block of units with common switchboard located outside
don't know what they would do if it was located inside the property, remove the fuse on power pole?
the actual disconnection in my case was electrician coming out, unscrewing the fuse and leaving it in switchboard
that only happens if (mistakenly) all attempts have been made to have the occupant connect or pay the account (reminders, disconnection notices, threats etc) and the account is still not paid.
i bought a house once that had all the fuses removed and locked. had to prove to the electricity place that we were new people in the premises - the previous tenants hadn't paid the bill for over a year.
Hi lizzie
I think it depends on the electricity supplier
I have certainly witnessed the man-with-the-pole coming and fitting and disconnecting fuses. In fact, I had received cards at premises stating that they were not able to connect / disconnect the supply as appliances were operating inside the house and that unless all circuit switches are in the 'off' position they will not connect / disconnect supply.
The gas is not 'disconnected'
The water is not 'disconnected'
but the electricity is very definitely dis-connected (there is no connection between the grid and the property) and part of this is because of the risk of fire.
Cheers
Kristine
I think it depends on the electricity supplier
I have certainly witnessed the man-with-the-pole coming and fitting and disconnecting fuses. In fact, I had received cards at premises stating that they were not able to connect / disconnect the supply as appliances were operating inside the house and that unless all circuit switches are in the 'off' position they will not connect / disconnect supply.
The gas is not 'disconnected'
The water is not 'disconnected'
but the electricity is very definitely dis-connected (there is no connection between the grid and the property) and part of this is because of the risk of fire.
Cheers
Kristine
I forgot to disconnect when we moevd out as tenant once a few years ago and the next tenants kept using electricity under our name. When the utility company sent the bill to our new address all we had to do was tell them we had moved out of the property on xxx date and are no longer the tenants there. They asked us for the agent contacts to verify that (and get the new tenants information I assume) which we supplied and they never bothered us again.
Update...
The $450 I initially thought was actually just the gas bill, the total including the electricity bill equals $630!! AGL aren't interested at all and have stated that the bills are in my name, and as I asked them to provide a service and they fullfilled with obligation... that's it.
In the Residential Tenancy Act that the tenants have signed, it clearly states that they agree to pay all gas, electicity, and water consumption. I will send the previous tenants a copy of the bills and the Tenancy Act with their signatures at the bottom and include a stern letter. Will see how I go!
The $450 I initially thought was actually just the gas bill, the total including the electricity bill equals $630!! AGL aren't interested at all and have stated that the bills are in my name, and as I asked them to provide a service and they fullfilled with obligation... that's it.
In the Residential Tenancy Act that the tenants have signed, it clearly states that they agree to pay all gas, electicity, and water consumption. I will send the previous tenants a copy of the bills and the Tenancy Act with their signatures at the bottom and include a stern letter. Will see how I go!
Hmmmm...interesting.
I (very) recently had a long term tenant up and leave my IP owing a few weeks rent and has left the electricity, gas etc still connected. I've been told by Integral Energy that any outstanding electricity bills will definately NOT be required to be paid by me. AGL on the other hand told me it would be in my interest to change gas over to my name. Don't think I will change it over though. I don't want to get stuck with any outstanding gas bills.
Regards
Marty
Thats fine then. We have the same arrangement with our property; the bills come to me as tenants were only going to rent short term (3 months but it extended) so I pay the bills on time (so I dont get a bad debt rating) copy the bills, send them to the PM and the PM gets the tenant to reimburse. As long as it is in the tenancy agreement that they will pay them (and remind the PM of that) it will be fine. Just make sure that you are not getting the tenant to pay for service that occurred before they moved in. No need for a stern letter at all; after all, they are not able to change the water bills into their name anyway!
Chasing a Dead Horse
I think you can send letters to agents. Then tenants then go to Tribunal . Even get a order that previous tenants pay. You say they left owing rent as well
Even after all this chasing around, expense and hassle i doubt that you will get any money back. Tenants like that just seem to dissapear.
Unfortunate as it is I think you will just have to put it down to experience.
Perhaps you will get a bit back if you claim it in your tax
Gee Cee
Greg
I think you can send letters to agents. Then tenants then go to Tribunal . Even get a order that previous tenants pay. You say they left owing rent as well
Even after all this chasing around, expense and hassle i doubt that you will get any money back. Tenants like that just seem to dissapear.
Unfortunate as it is I think you will just have to put it down to experience.
Perhaps you will get a bit back if you claim it in your tax
Gee Cee
Greg