Tenant over 2 months in arrears

S

SimonJai

Hi guys,

I've had the same tenant for the past three years in my IP, however the past few months has been dreadful.

My property manager does not appear to be doing their job as the tenant were a year behind in water bills and a month or so behind in rent. I had to personally notify the property manager before anything was done.

About 2 months ago the PM went to the tribunal for me to chase up the money or have the property relisted.

A month ago the tenant failed to paid the required amount ordered by the tribunal, the PM notified me and told me they were going to have the property relisted. Now the tenant is over 8 weeks in arrears and I've just sent an email to my PM.

This is my first time I've had issues, and would appreciate any advice you can give me.

If I evict the tenant, what is the best way to recover the amount in arrears paid? Can I recover costs from the PM as they failed to do their job?

I'm definitely going to change property managers, does anyone have any good recommendations for the Beverly Hills area?

Cheers,
Simon
 
Sorry to hear of your plight. I think you may have to cut your losses. Speak to your real estate agent by phone and organise to have the tenant evicted as soon as possible.
 
So the PM still didn't move to evict, the day that the tenant didn't cough up the arrears a month ago?

That's appallingly bad.
 
Perp said:
So the PM still didn't move to evict, the day that the tenant didn't cough up the arrears a month ago?

That's appallingly bad.
Click to expand...

The tenant never caught up, my PM advised me to wait until the tenant has caught up in payments before evicting them.

Thanks for the advice guys, I think I will call my PM up and have them evict the tenant asap.

In order to change my PM, do I need to give them notice? Also do I need to let my PM know not to relist the property as I assume my new PM will handle that.
 
That is awful!

You *should* get the bond back, which will help - but obviously you will still be out of pocket.

Do you have insurance?

To be perfectly honest, it is incredibly hard to get the $$ off a tenant and I imagine your management agreement with the REA is quite tight in the event they're not doing their job.

You will need to claim whatever you can against the bond, get compensation awarded against you for the remainder from tribunal. Once you have the compensation order, you can get debt collectors involved if you wish, bear in mind this is a long process and they charge ~20% of the claim (or whatever they recover), and to have this process started you'd normally need to pay a fee of ~$200 to get them started. This can be added to the claim, but again, not always successful at getting the money.

Check your management agreement to see if there's any notice that must be given to terminate. If the tenant is in arrears and they're not making any money, they might be happy to let it go.

Also, the new agent should handle everything. It's best to be upfront about the situation, but some may not want to take on a property until tribunal is finalised.
 
Thanks for the advice Lil Skater, I will check the management agreement when I get home.

I had a look at my landlord insurance (with CBA) and the tenant must not have paid rent consecutively for 4 weeks before I can claim loss of rent. The longest I can see based on my bank deposits is 3 weeks. Is this normal with landlord insurance for loss of rent?
 
It really depends on each policy, they're all so different.

It's perhaps best to check if it's "paid" for 4 consecutive weeks, or if it's 4 weeks in arrears. If it's paid, that's unfair as they're still more than 4 weeks in arrears.

As I understand there's a lot that are 4 weeks or a month, as usually you will hold that amount in bond.
 
Pretty poor of your PropMgr not to get onto this right away when the arrears started showing. I think you should escalate this to the head of the pm department and ask for a new manager or if you are that upset walk away to a new agency.
 
As a suggestion, you could also put in place a payment plan to recover monies. We did this with our former tenants who had to break-lease when they could no longer afford the rent. We were able to recover the full amount owing fairly quickly and we did not have to go to court or use our insurance.
 
That must be awful for you, having trusted the PM that do not do a proper job. If tenant has been there for 3 years and this is the first had trouble paying rent; may be you should find out why and work out with the tenant the repayment plan if possible? Say, every week for X number of weeks, tenant needs to pay certain amount above the weekly rent? Or has tenant completely stopped paying rent?

I hope you will get LL insurance cover.


SimonJai said:
Hi guys,

I've had the same tenant for the past three years in my IP, however the past few months has been dreadful.

My property manager does not appear to be doing their job as the tenant were a year behind in water bills and a month or so behind in rent. I had to personally notify the property manager before anything was done.

About 2 months ago the PM went to the tribunal for me to chase up the money or have the property relisted.

A month ago the tenant failed to paid the required amount ordered by the tribunal, the PM notified me and told me they were going to have the property relisted. Now the tenant is over 8 weeks in arrears and I've just sent an email to my PM.

This is my first time I've had issues, and would appreciate any advice you can give me.

If I evict the tenant, what is the best way to recover the amount in arrears paid? Can I recover costs from the PM as they failed to do their job?

I'm definitely going to change property managers, does anyone have any good recommendations for the Beverly Hills area?

Cheers,
Simon
Click to expand...
 
MKP said:
That must be awful for you, having trusted the PM that do not do a proper job. If tenant has been there for 3 years and this is the first had trouble paying rent; may be you should find out why and work out with the tenant the repayment plan if possible? Say, every week for X number of weeks, tenant needs to pay certain amount above the weekly rent? Or has tenant completely stopped paying rent?

I hope you will get LL insurance cover.
Click to expand...

Previously it was two families living in the property, the tenant's family and her sister's family. However I only found out from the PM when I confronted her about the arrears that the sister had moved out and the tenant was having trouble paying rent.

We've already gone through the tribunal and there's a court order to have the tenant pay an extra amount every week to recuperate the amount in arrears, however they have failed to do so twice and so the tenant agreement has been terminated.

Spoke to the associate of the PM this after, the tenant is meant to be evicted today but she's too busy so she will check tomorrow morning and give me an update.
 
Last edited:
Oh.. its that bad! I hope you can minimise your losses and find a better PM and better tenant next time. Call the insurer anyway, because I believe they assess a claim case by case..
MKP


SimonJai said:
Previously it was two families living in the property, the tenant's family and her sister's family. However I only found from the PM when I confronted her about the arrears that the sister had moved out and the tenant was having trouble paying rent.

We've already gone through the tribunal and there's a court order to have the tenant pay an extra amount every week to recuperate the amount in arrears, however they have failed to do so twice and so the tenant agreement has been terminated.

Spoke to the associate of the PM this after, the tenant is meant to be evicted today but she's too busy so she will check tomorrow morning and give me an update.
Click to expand...
 
The assistant to the PM called me today, said the tenant left yesterday. My PM has actually not gotten back to me eventhough I sent her an email on Monday and yesterday.

There's a huge mess on the lawn and the key she used (which worked previously when she inspected the property 1 month ago) no longer works. She put the key in 3/4 of the way and it wouldn't go any further.

Tenant said they would drop the keys off tomorrow. So we'll see what happens. I definitely will be putting in a claim with my insurance, so fingers crossed it all pans out.

A few people I talked to said to wait for the current PM to clean up the mess, assist me with making the insurance claim and finding a new tenant, before changing the PM. What is everyone's thoughts on that?
 
SimonJai said:
A few people I talked to said to wait for the current PM to clean up the mess, assist me with making the insurance claim and finding a new tenant, before changing the PM. What is everyone's thoughts on that?
Click to expand...
Because they've been so helpful up until this point, right?:rolleyes:
nhg said:
been there, done that.

change PM immediately.

waiting will only further your frustrations.
Click to expand...

Like Nhg said, you will only get further & further frustrated by hanging onto this PM. A good PM, will help you sort this out. If you let us know where the property is, maybe someone can point you in the direction of a good property manager than will take this on, as is, for you.
 
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