Tenant defaulted......sob story....what should I do?

B

ballontree

My agent went to visit the tenant at home last night.

Tenant lost his old job due to being very sick.

He has just started a new job.

Tenant has promised that he will pay something this week when he gets his first part pay

and more every week thereafter to make up the difference.

owning 5 weeks rent (back), and 2 weeks rent (forward)
 
Have the tenant give you a payment schedule in writing.
Issue all forms to start eviction, and tell him you will cancel them if he doesn't default. When it goes to court, ask for a mediated settlement.


On occassion we have done this, and when they default, there is no appeal, and it can go straight to collection.
 
btw, they have defaulted once, with about 8 week rents, and have paid all back

wasn't too long ago; like 2-3 months ago; and it's starting to come back in.

would this info change your advice?
 
I would DEFINITELY start the eviction process.

You can always cancel it and let them stay if they make a huge effort and get back on track, but you must not let them convince you to do nothing in the mean-time.

It can sometimes take months to get a tenant out, and you don't want to be left with empty pockets.

Also - how long have you known about this for? I always breach tenants at 7 days behind and then send them a notice to leave at 14 days behind (and lodge court documents at 14 days). (This is the fastest we can do it in QLD).

Get your property manager on to it immediately.
 
mattysavager said:
Also - how long have you known about this for? I always breach tenants at 7 days behind and then send them a notice to leave at 14 days behind (and lodge court documents at 14 days). (This is the fastest we can do it in QLD).
Click to expand...


It's in Vic,
this is their 2nd yearly lease

the PM only notified me when they didn't pay for 4 weeks.

I was told that they need to give them that kind of allowances?


now they are 5 weeks behind; they need to pay 7 weeks rent to be in front of the payment schedule
 
alexlee said:
Time to get a new PM too.
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thanks, btw, what's the period in vic where we can evict them when they default? i have no idea why the PM notified me when they are 4 weeks behind (needing to pay 6 weeks rent to be in front of their payment); it also means that miss 3 x fortnightly payments before notifying me?

where can i find this information?
 
ballontree said:
thanks, btw, what's the period in vic where we can evict them when they default? i have no idea why the PM notified me when they are 4 weeks behind (needing to pay 6 weeks rent to be in front of their payment); it also means that miss 3 x fortnightly payments before notifying me?
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How often does the PM pay the rent to you? Must be at least every month, yes? How did you not notice that many weeks of rent missing? The rental statement should clearly show when the tenant is paid up to. You should have noticed they were falling behind and contacted your PM immediately.
 
alexlee said:
How often does the PM pay the rent to you? Must be at least every month, yes? How did you not notice that many weeks of rent missing? The rental statement should clearly show when the tenant is paid up to. You should have noticed they were falling behind and contacted your PM immediately.
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the tenant pays fornightly, the PM pays me monthly; so they only notified me when they sent me the rental receipt.

So when I got to know about it, it's already 4 weeks; now it's the 5th week.

I called them last week, they said they have given the tenant notice to pay up and it's due yesterday. and they are asking my decision today.

I just told them to get the tenants out.


please let me know if it could been improve
 
It is always good to be on the front foot with the eviction paperwork. Tell them it is nothing personal but you need to protect your interests. It can always be withdrawn.
 
You need a new PM! :eek:

The tenant must be 14 full days to evict, so on the 15th day your PM should immediately issue a notice to vacate. A few days must be allowed for postage of the notice, and a VCAT application can be made on the 17-18th day. You'll usually have a hearing within a week or two, and at that hearing you are after possession of the property.

If the tenant isn't there and the PM has done everything by the book, you are almost guaranteed a possession order, however if the tenant turns up they will usually not evict the first time around (annoying!) and will allow the tenant a payment plan. If the tenant defaults at any stage during this payment period you can straight away apply for another VCAT hearing to evict.

If your tenant was already in arrears a few months ago, but you didn't go to VCAT you're very lucky they paid up, as your landlord insurance would likely be void if no formal action was taken!

Re - your above post. If the only problem is a tenant in arrears, I'd be changing agents now as the normal eviction process for arrears is pretty straight forward.
 
If you assume at the end of May, your tenant was paid up (2 weeks in advance), then your statement should say 'tenant paid up to 15 June). Even if the tenant stopped paying at that point, by the end of June your statement would have said 'tenant paid up to 15 June' (i.e. 2 weeks behind).

Assuming they were paid up to start with, you should have noticed they were late when they were no more than 2 weeks behind.

If they had already behind by the end of a month, your statement for May would have said 'tenant paid up to 7 June', for example, and you should have called the PM then to check what's going on.

Then you should have been in contact with the PM constantly until this was resolved.
 
alexlee said:
Assuming they were paid up to start with, you should have noticed they were late when they were no more than 2 weeks behind.
Click to expand...




When I received May's statements in June, the statements indicated that they paid promptly.

When I received June's statements in July, they only paid up til Jun 2x; I only received the statement last week (mid of July) statements were late.

When I found that out, I quickly asked the PM to find out what's going on, and asked to evict them or something - they said they have mailed a letter last Wed, and will expect them to receive the letter on Friday + 3 working days to respond - which is yesterday.


I feel that I should have receive my rental statements on time; closer to the 1st of every month instead of mid of the month? hmmmmmmm, change PM now or later, hmmmmm, is there any PM you would recommend for Melton, Vic?
 
Your contract with the PM should state how many days notice you need to give.

Start looking for a new PM now. Most agencies will pay your penalty to the old agency, and take over immediately. this is what you want. You don't want to leave it with the current PM for your 30/60/90 day notice period because they may give up on you, and stop chasing the tenants.

As for statements - there is no excuse for taking 2 weeks to issue statements. We send ours on the first of the month, every month (and the 15th for mid-month statements). At the end of June we had a server crash but still managed to get them all sent by the 3rd (which is pretty significant for us).

Also - they should be pro-active with arrears. We call landlords when they get to 5 or 6 days behind. We NEVER let our clients find out that their tenant is in arrears by reading their statement. That's really poor.

Start shopping around and find an agent who will take over immediately and either pay out the contract with the current PM, or give you free managements until that contract expires.

Matt
 
We use The Proffessionals in Melton and so far they have been great. Did have PRD looking after it, what a nightmare, 9 pm's in 12 months and nightmare tenants to boot. So shop around, there are a few good ones.
 
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