Tenant did a runner. PM took 7 weeks.

[poidda]

Hi,

I've had my first tenant do a runner. The IP recently became vacant, and was filled straight away. The tenant did the usual thing and paid 2 weeks rent, and bod etc etc.

Then it all went pear shaped.

It turns out that they broke up, and both decided to move out without contacting my PM. It took me to notice the missing money from my statements and contacted the PM.

So 7 weeks behind rent, and they were finally found to have abandoned the IP. Obviously the bond doesn't cover this much missing rent.

So where do I stand? Should my PM be responsible for the missing rent? She says she will take them to court etc etc, but what are the chances of seeing any of this?

This is the first time in this situation, so not sure how it all usually plays out. The PM has been great for the past 4 years, so a little disappointed with it all.

Cheers.

 

[marg4000]

Your landlord insurance will cover the shortfall once the bond is taken into account.
Marg

 

[Luv2Travel]

Sounds like your property manager should have acted sooner, but I doubt you'll be able to make a claim against them.

This is where landlord insurance is recommended, to cover this type of situation. I'm going through a situation at the moment, where I'm glad I have it, as it will cover 10 of the 12 weeks I've lost in rent.

 

[poidda]

Yeah I know Landlord Insurance will cover it if need be, but considering the excess payable and then the increase in premium, I hope to not have to go down that route.

Do PMs have any sort of Insurance? I'm starting to wonder why I'm paying the PM if it was me that had to alert them that rent was well overdue.

 

[womble66]

Kiss it all good bye as it unlikely the PM wont pay from my experience. The bond should cover at least 4 weeks the LL if required and then the PM should take them to the Tribunal for the extra till it is rented again or to cover damage etc. Once you have an outcome from all this that you are happy with move PMs and add it to your experience file in owning IPs. Your lucky it was only 7 weeks as I have heard some horror stories about PMs doing simliar lazy jobs.

 

[Luv2Travel]

Once you have an outcome from all this that you are happy with move PMs and add it to your experience file in owning IPs.

Totally agree, this is how I'm dealing with my current situation. My PM did everything by the book, it was the system that let my tenants get away with so much. I can either focus on the negative, and how much it's costing me(repairs/cleaning/insurance excess/rent loss), and gain nothing, or move on, fix it up and get a good tenant in. This will be a vague memory one day, and the cost to me, is minimal when compared to increase in value of the property. It's easy to get angry I know, but you won't benefit anything from it.

 

[The Y-man]

Yeah I know Landlord Insurance will cover it if need be, but considering the excess payable and then the increase in premium, I hope to not have to go down that route.

Individual premiums have not gone up for the insurer I am with no matter how many claims I have put in.....

The Y-man

 

[Scott No Mates]

At the barest minimum, the pm should wear any reletting fees and inspection costs as they should have been seeking your instructions after day 14.

 

[Dazz]

So where do I stand?

You currently stand waaaay out of pocket, which in domestic spats such as this, is par for the course.

The asset you purchased inherently attracts Tenants that, if they split, cause you big cashflow headaches....but you knew that already.

 

[redwing]

Yeah I know Landlord Insurance will cover it if need be, but considering the excess payable and then the increase in premium, I hope to not have to go down that route.

Do PMs have any sort of Insurance? I'm starting to wonder why I'm paying the PM if it was me that had to alert them that rent was well overdue.

What are you looking at currently with regards to excess and any increase in premium...roughly?

 

[DavidMc]

Once complete, I'd ask the PM specifically what kind of software based monitoring or alerts they receive when a tenant is late.

Surely a good shop would have all this setup and automate their breach notices out to LL's and tenants.

 

[damacc]

You would think breach notices are automated. I had one property manager which was a branch office. The breach notices were being sent from the head office. By the time the branch office realised there was a problem (12 days), they notify the head office (another 10 days) who would send out the breach notice. So, it took about 22 days for the tenant to get a breach notice. I now ask the question to potential PMs who sends the breach notices.

 

[mattysavager]

Tenant breach notices aren't automated. They each have to be signed by the PM to take effect.

We check our system daily, anyone who is 2-3 days in arrears gets a "friendly reminder" SMS message, 4-6 days get a "pay immediately or be breached" SMS and anyone who we can breach, we do breach immediately.

Any of our tenants would never get more than 3 days behind without us knowing and taking action. Anything longer than that means the agent is not doing their job.

The previous poster's comment about it taking 22 days - Terrible. We would have already sent them a Notice to Leave already in that time.

 

[poidda]

Cheers for all the comments. This is progressing. Supposedly they split and he's gone and worked in the mines, not knowing his ex did a runner. He has "agreed" to pay all outstanding rent as he doesn't want his name on any black lists which my PM threatened.

So we'll see if any cash arrives in the next couple of days and go from there. Unit is already listed and received a couple of applications so should be filled by the weekend.

Fingers crossed.