More tenant on the same lease, yes or no?

[Olive]

Hi all,

It hasn't been a year yet if you still remember our tenants sent us a breach notice the 1st day they moved in. They've been good so far, paying rent on time and paying more than what's needed so we always have $ on account. We also done whatever repair needed. so far ok.

Tenants they r a couple with 1 dog and 1 cat, have recently request to add another person on the lease, agent said if we ok with that they will simply up the bond. Agent also said that tenants don;t want to have this guy living in the house without our permission. This extra person is in his early 20s has only been living with parents, he has a part time job. He's a mate of the male tenant from the same sport team.

There is no mentioning more rent, rather this new tenant will also be responsible for the house and his portion of rent. Perhaps our tenants want him on board to share the $280 p/w rent?

Looks like our agent then will need to collect x2 rent, deal with x2 group, if were to kick them out kick twice... plus what if the young tenant decides not to rent would we be left with 2 tenants who only pay their portion of $187? they can also blame each other for not keep clean of the house... or invite more mates, girls, drugs, crimes etc etc...where is that pic of a young couple with 2 little kids happily running around in the back yard?

I have a bad feeling about it, seems to have lots of liability and risk to us landlord...or am i being too sensitive?

Same street down the road renting for $340 newer and nicer. We were thinking to up the rent to $295 next year anyways as the market have not much under $300 these days.

What's your thoughts on this? Should we say no and simply up the rent next year or take this opportunity allow the extra person on board but up the rent to say $3xx may be and see how it goes?

I am afraid they're going to smuggle him in anyways, we wouldn;t know, how to avoid that?

many thanks

Olive

 

[chilliblue]

If the existing tenants are on lease and you have bad feelings do not do it. Just ensure that you place the PM on notice to keep an eye out of their existence during any inspection reports.

If not, this may be opportune moment to increase the rental and keep the existing tenants.

However, you will need to make it clear to the agent to check the additional person's references before any approval is considered.

There would only be one lease, one party of people to deal with and every adult on the lease equally responsible for its terms.

Others on the forum may also have some ideas.

 

[Propertunity]

Olive,

In many situations, tenants do "smuggle" in other tenants without telling anyone. You should perhaps be glad that they are being open with you and asking your permission.

You don't have to say "yes" if you don't want to of course. But really I don't see it as any big deal. If one of my tenant familes has a baby, I don't go into a sweat about having another person living at the property. But please do have the references of the person checked before putting them on the lease.

Your PM cannot simply "up the bond". This is a strange statement to make. The amount of bond is regulated by the individual state tenancy laws - mostly 4 weeks rent.

Also the PM will collecting only 1 weeks' rent from whomever pays it to them so won't be collecting x 2 or kicking out x 2. If they get their lease terminated, they all go out together.

You really need to have a read of the Act that governs the business you are running - noting the responsibilities of the LL and the tenant. Also realise where your PM fits into the scheme of things. Then you will a lot more relaxed about how to make these decisions.

 

[chilliblue]

Olive,

In many situations, tenants do "smuggle" in other tenants without telling anyone. You should perhaps be glad that they are being open with you and asking your permission.

You don't have to say "yes" if you don't want to of course. But really I don't see it as any big deal. If one of my tenant familes has a baby, I don't go into a sweat about having another person living at the property. But please do have the references of the person checked before putting them on the lease.

Your PM cannot simply "up the bond". This is a strange statement to make. The amount of bond is regulated by the individual state tenancy laws - mostly 4 weeks rent.

Also the PM will collecting only 1 weeks' rent from whomever pays it to them so won't be collecting x 2 or kicking out x 2. If they get their lease terminated, they all go out together.

You really need to have a read of the Act that governs the business you are running - noting the responsibilities of the LL and the tenant. Also realise where your PM fits into the scheme of things. Then you will a lot more relaxed about how to make these decisions.

Do you not agree that the PM should have informed Olive of the above. At the end of the day, this is a normal occurance for an agency and no issue?

 

[Propertunity]

Do you not agree that the PM should have informed Olive of the above. At the end of the day, this is a normal occurance for an agency and no issue?

I'm sorry chilliblue, I have read it a couple of times, but I am not sure I understand your Q here?

 

[chilliblue]

If I employ a PM for a residental property, I do so because I believe that they have a level of knowledge and experience greater than I have.

When advising Olive, should the PM not have:

1. Informed Olive that is good that the tenants are being open about someone else residing at the property rather than sneaking them in

2. Have has all references checked for the additional person prior to making a request

3. What options were open to Olive i.e. if accepted, the additional tenant would be added to the lease and bear same liability as the others already nominated

Is it that agents are not doing their job properly or that they are not communicating with their landlords?

 

[alplant]

I found the comment about 'upping the bond' a little strange too. I'm pretty sure that can't happen just because extra people move in, maybe they meant upping the rent.

You say it hasn't even been a year yet and that might be enough to stop the bond from being increased. It would be here in Queensland, only once a year allowed.

From the RTA website.

"If the rent goes up, the owner/manager might also ask the tenant to pay more rental bond. Notice of bond increase can only be given if it is at least 11 months since the last bond increase. One months notice about the bond increase must be given. The extra bond must be lodged with the RTA."

 

[Propertunity]

If I employ a PM for a residental property, I do so because I believe that they have a level of knowledge and experience greater than I have.

I can accept that people do that - yes. But if the PM tries to pull-the-wool-over-their-eyes it would be better if they familiarised themselves with the Act so they know the law. It does not mean they have to do the job of self-managing, but they do need to manage their 'employee' the PM.

1. Informed Olive that is good that the tenants are being open about someone else residing at the property rather than sneaking them in

Yes, but I think the agent did inform Olive that they wanted to add a person to the lease.

2. Have has all references checked for the additional person prior to making a request

A PM who was "on-the-ball" would have done reference checks first - yes. This PM is not very pro-active from the sounds of it.

3. What options were open to Olive i.e. if accepted, the additional tenant would be added to the lease and bear same liability as the others already nominated

Yes, the PM should have informed Olive of her rights & responsibilities.

Is it that agents are not doing their job properly or that they are not communicating with their landlords?

We are getting this story second hand. - so we don't know. The agent may have done their job properly (or not). They may have informed Olive.... but Olive may not have understood .....or there may be some kind of communication breakdown - I agree with you.

Cheers to you chilliblue. Alan

 

[Peterw]

Its not unusual for tenants to request an additional person. It can be done a couple of ways. 1. For them to be added to the tenancy document, a new one woul dhave to be drawn up. Remember, tenants of a tenancy agreemen, have a joint and several responsibility/liability. 2. Be allowed to occupy, as an "approved occupant". They are not part of the responsible/liable group.

 

[Olive]

Thanks everyone, with the new tenant PM actually said "will have his name transferred onto the bond" if we are happy. PM also said "Also if this person is added onto the lease he also becomes responsible for all rental payments and maintenance of the property."

I have asked PM if we'll need to deal with x2 tenants and if anything goes wrong chase x2 parties?

Will keep you updated.

Olive

 

[Peterw]

Olive, with joint and several liability, while your should "chase up" every one, the one you catch can be made liable for the "whole". That the way the legislation and tenancy agreements are worded in Queensland.

 

[Olive]

I am quite upset with PM's reply:
"It is a common that other people’s friends or family members are added onto the lease agreement......Legally we cannot knock back this applicant, and as we would transfer the bond into all three names all three tenants are responsible for all rental payments/problems that could occur."

If we LL can't knock back the applicant does that mean our property door is widely open for whoever wana live in it and pay no extra rent while giving it more wear and then us LL repair it? What is LL's right? If we can;t even say NO why asked in the first place??

Or did i misunderstood the meaning of 'knock back'?

House is in VIC, does anyone know about LL's right in VIC?

Sounds like PM stands on tenants side......

 

[Olive]

Hi Peterw,

nothing's carefully worded, if it was us we'd hire a solicitor to get it done properly. When PM added in a clause for the dog and cat it didn't mentioned tenants need to steam clean carpet and pest control and provide receipt upon returning of the property. It;s basically 'just keep clean'. We got a reference lease from another agent which we found to be very professional. We forwarded to our PM and requested to have the same words but they claimed it's from another agent they can't use it...

It feels like they do things their way, and we found it to be a simple way, way too simple!

We live in NSW, we do have an impression that PM often says this is VIC 'WE' do things this way, you know what I mean?

May be it's time to change PM...............................

 

[Dazz]

No Olive - the PM is standing on the PM's side.

The PM is repeating what is in the rulebook.

The rulebook stands on the Tenant's side.

If you are the LL, you stand alone. Your side sux.

If the property is in Vic, you are paddle-less up a reasonably murky river.


Def'n of "knock-back" ;

What happens to a Victorian Landlord when they read the rulebook.

 

[SeafordSunshine]

Hello Olive,
How many tenants are living there?
how many(adult) tenants and (children) are mentioned on the lease?
How many dogs, cats etc?
If they want a new lease you may be able to stipulate the carpets be steam cleaned and de-odorised, and house de-flead at the end of the tenancy.
How many people actually want to live there?
How many bedrooms is it? What about wear and tear on your house?
Is it a student area or a backpacker area? Will all and sundry be moving in and out?
keep up with your diligence, and
Make it work for you Olive!
Good luck with your investment
SeafordSunshine

 

[wylie]

We got a reference lease from another agent which we found to be very professional.

Why not get this more professional agent to take it over.

 

[Dazz]

Read / Understand / Know off by heart the Rulebook

Olive,


After reading the letter the PM's boss wrote to you, it is clear to me at least, that their impression of you, obviously through your questioning, letters, correspondence, phone calls.....is that you don't know what you are taking about in terms of being a residential Landlord.


That letter wouldn't be out of place with a Kindy Teacher talking down to a 3 yr old.


If you wish to be in the business of being a residential Landlord, you simply must have an excellent grasp of the Law governing the relationship between you and your customer. Palming that fundamental responsibility off to some hired PM lands you in the mess you are in.


Hire a PM by all means to represent you, but don't delegate / ignore your absolutely required knowledge of what is necessary to be a competent residential Landlord.


Our RTA is only 80 pages of very easy to read large print. Any grade 7 school kid could have it under their belt within a few weeks. Even the wet behind the ears 18 secretary's at the REA office do the exam to test their level of kowledge of the RTA and pass with flying colours after 1 week. She ain't rocket science Olive....


Note : All of the above was based on what the original poster wrote above in the two posts that have now been deleted. I guess it doesn't matter to her now.

 

[alplant]

Olive I don't really see a problem with adding another person to the lease and having them held responsible for any damage but I did notice in your post something about part payments.

We have had tenants in the past who have paid part payments and the money has always gone directly into our account, not been held by the RE until there was a full payment.

If they pay half a week for instance the statement will say they are only paid up to the date of the last full payment but the half week will see them in credit. The rent is only paid at the end of the month anyway in our case, but if there is a half week there it goes into our account, not into some holding account for the RE.

 

[Olive]

The only problem is that whenever there is a transfer of $ into our account PM issues a statment. Each statement cost a few dollars. For a period of time there were multiple statement within a month. One month we had 3 statements. PM said they must issue a statement whenever there is a money transfer. Not sure if that's the same with other PM?

 

[Lil Skater]

There is no mentioning more rent, rather this new tenant will also be responsible for the house and his portion of rent.

Looks like our agent then will need to collect x2 rent, deal with x2 group, if were to kick them out kick twice... plus what if the young tenant decides not to rent would we be left with 2 tenants who only pay their portion of $187?

I am afraid they're going to smuggle him in anyways, we wouldn;t know, how to avoid that?

Hi Olive, if the tenant is on a lease, then you can't up the rent and the new tenant would only be responsible for the house and their portion of the rent.

Rather than collecting two rents, I would have it that the current tenants are responsible for collecting the rent for the new tenant. Meaning, the new guys pay them and they pay you and it's their responsibility to still pay you the full amount if he defaults. As he would be on the lease as well, it wouldn't be like there is two tenants - It should remain the same, one person defaults they're all punished and you would be evicting all three tenants at once rather than the couple and then the new tenant.

The PM also cannot up the bond without upping the rent, they are allowed to charge a maximum of one months rent as bond.

Also, you are running the risk of them letting him anyway, without your permission, but in this case you can breach them for sub-leasing.

I am quite upset with PM's reply:
"It is a common that other people’s friends or family members are added onto the lease agreement......Legally we cannot knock back this applicant, and as we would transfer the bond into all three names all three tenants are responsible for all rental payments/problems that could occur."

This is correct, for some part anyway. You cannot knock back their application if all is good, but from my understanding if the applicant has a black mark against their name on NTD or something you can.

So, i'm guessing as he has only lived with his parents and has no rental history, as long as his references check out you cannot deny the tenants to sub-let to the new guy. But if there is a reason to not let this guy in, in the eyes of VCAT anyway, you may not have a say.

When PM added in a clause for the dog and cat it didn't mentioned tenants need to steam clean carpet and pest control and provide receipt upon returning of the property.

May be it's time to change PM...............................

All of our leases say that the tenant must steam clean the carpets on vacating the property, with or without a pet. All of our pet clauses however, also add that the tenant must treat the house for fleas when they vacate and that they take full responsibility for damage caused by the animal, and if there is any damage they must repair it to the LL's satisfaction.

Maybe a new PM is in need...

The only problem is that whenever there is a transfer of $ into our account PM issues a statment. Each statement cost a few dollars.

Ah, the statements. Each statement of ours, from memory, is $1.55, but you can choose to be a weekly LL which means that a statement is issued every time a tenant pays but you receive rental payments as frequently as the tenants pay, or a monthly LL which means you get one statement a month and the rental payments get issued once a month.

Maybe check this out and say you don't want or need a statement each time a tenant pays and you wish to only receive monies once a month along with the statement.