What if tenants don't move out by settlement day?.

4

4future

Hi there,

By contract, the property should be settled in 2 weeks, counting from today on. Contract also specified vacant tenants, although there were tenants when it was signed.

It seems now the tenants cannot or won't move out before settlement although notice was issued on 17th June.

Any suggestion for this situation? I need to settle then move in asap.



Thanks
 
I'm assuming your tenant is on a periodic tenancy. Pretty sure most states the lease overrides the landlords sale contract... If the tenants don't leave when sufficient notice has been given (different between the states) then you may have to go through eviction process. A PM (Sez posts here) should be able to assist if you let everyone know what state you are in.
 
As everyone has said it depends on your state, given that the tenant appears to have been given 30 days notice to vacate I would take a guess at NSW????

As there are 2 weeks until settlement I would talk to the current managing agent and see if they will make an application to tribunal for possession of the property based on the notice to vacate. They should make this application now for a hearing date as close to settlement as possible. If they wait until settlement then it will be a few weeks before a hearing.

In the past if I have had this problem with a property I manage settlement is generally pushed back by a week to a fortnight to allow for the tribunal and eviction process to be completed. Either that or settlement goes through and the rent after settlement date is paid to the new owner, that is something for you to discuss with your solicitor :).

Definately have a chat to the PM as they will be more familiar with the state laws (My general advice is based on VIC laws), though they don't tend to vary too much so it is somewhere to start.

ACTInvestor - Thanks for the heads up :D.
 
cannonloose said:
Several similar threads already around which you may want to read:
http://www.somersoft.com/forums/showthread.php?t=51063
http://www.somersoft.com/forums/showthread.php?t=53998 http://www.somersoft.com/forums/showthread.php?t=54606
http://www.somersoft.com/forums/showthread.php?t=54894

From what I've read general advice seems to be don't settle until the tenants have vacated, put pressure on the vendor to resolve the issue.
Click to expand...

Thank you, cannonloose, for the list. I am to read the threads.

For sure, I won't settle before tenents move out.

I was wondering if there is any chance or wany way for me to claims my loss happening after settlement date until the day when it actually settles? e.g. rent for temporary living place, fee for moving furniture 2nd time and etc.

Hope I can find some answers from the threads.

Thanks
 
ACTInvestor said:
I'm assuming your tenant is on a periodic tenancy. Pretty sure most states the lease overrides the landlords sale contract... If the tenants don't leave when sufficient notice has been given (different between the states) then you may have to go through eviction process. A PM (Sez posts here) should be able to assist if you let everyone know what state you are in.
Click to expand...

Hi ACTInvestor, thank you for your reply. I am in Sydney, NSW.

The lease attached to land contract states it has ended in May 2011. I think the tenents are extending by week. Vendor's solicitor confirmed the notice had been issued on 17th June, which is more than 30 calendar days till settlement date stated in land contract.

Any idea about, with PM's help, when could eviction process start the earlist? Generally how long will it take eviction process to move tenantes?

Thanks
 
Sez said:
As everyone has said it depends on your state, given that the tenant appears to have been given 30 days notice to vacate I would take a guess at NSW????

As there are 2 weeks until settlement I would talk to the current managing agent and see if they will make an application to tribunal for possession of the property based on the notice to vacate. They should make this application now for a hearing date as close to settlement as possible. If they wait until settlement then it will be a few weeks before a hearing.

In the past if I have had this problem with a property I manage settlement is generally pushed back by a week to a fortnight to allow for the tribunal and eviction process to be completed. Either that or settlement goes through and the rent after settlement date is paid to the new owner, that is something for you to discuss with your solicitor :).

Definately have a chat to the PM as they will be more familiar with the state laws (My general advice is based on VIC laws), though they don't tend to vary too much so it is somewhere to start.

ACTInvestor - Thanks for the heads up :D.
Click to expand...

Hi Sez, you are right that it's NSW. Thank you very much for your pragmatic and professional advice. Really appreciate that.
 
I'm sorry but I wouldn't get involved in the process if I was the buyer.
This is the sellers problem, full stop.
Don't settle unless it is vacant possession and ask your solicitor to lodge a claim for expenses (if you incur any, such as rent, moving etc). Whilst unlikely to be paid these can be deducted from the settlement payment. Make sure that these escalate accordingly based on the time it takes so as to motivate the vendor.
A.
 
ozsupra said:
I'm sorry but I wouldn't get involved in the process if I was the buyer.
This is the sellers problem, full stop.
Don't settle unless it is vacant possession and ask your solicitor to lodge a claim for expenses (if you incur any, such as rent, moving etc). Whilst unlikely to be paid these can be deducted from the settlement payment. Make sure that these escalate accordingly based on the time it takes so as to motivate the vendor.
A.
Click to expand...

Hi ozsupra, thank you for your advise. I was thinking similar, just a bit worried if extra cost can be claimed.

Seems right time now to grasp my solicitor for a talk.

Thanks to everybody replied.

Cheers
 
cannonloose said:
Several similar threads already around which you may want to read:
http://www.somersoft.com/forums/showthread.php?t=51063
http://www.somersoft.com/forums/showthread.php?t=53998 http://www.somersoft.com/forums/showthread.php?t=54606
http://www.somersoft.com/forums/showthread.php?t=54894

From what I've read general advice seems to be don't settle until the tenants have vacated, put pressure on the vendor to resolve the issue.
Click to expand...

Bumping up this thread as we are in a similar situation where the property we are looking to purchase as vacant possession has troublesome tenants but the vendor has a clause that states contract will continue even if they are still there.

In the cooling off period (where we are now) they have already requested an extra week for settlement in case they don't move out and the clause would cover them if they dont - has anyone dealt with a similar clause?? :confused: We have asked that they remove this but they have so far said no.

We are having a hard time trying to see how the vendor will ever sell the property with this attitude.. the tenants have trashed the place (mainly cosmetics - we will need to replace all blinds/carpets and replaster/paint all walls) and we agreed to a sale price with them fixing up a retaining wall which our P&B inspector says to allow for replacement because it isnt done properly.. and we are planning on negotiating the price further due to some plumbing issues that have since come up as well.

For our first home purchase, this vendor has pulled out all the stops to make it really difficult and stressful :(
 
syd_newbie said:
Bumping up this thread as we are in a similar situation where the property we are looking to purchase as vacant possession has troublesome tenants but the vendor has a clause that states contract will continue even if they are still there.

In the cooling off period (where we are now) they have already requested an extra week for settlement in case they don't move out and the clause would cover them if they dont - has anyone dealt with a similar clause?? :confused: We have asked that they remove this but they have so far said no.

We are having a hard time trying to see how the vendor will ever sell the property with this attitude.. the tenants have trashed the place (mainly cosmetics - we will need to replace all blinds/carpets and replaster/paint all walls) and we agreed to a sale price with them fixing up a retaining wall which our P&B inspector says to allow for replacement because it isnt done properly.. and we are planning on negotiating the price further due to some plumbing issues that have since come up as well.

For our first home purchase, this vendor has pulled out all the stops to make it really difficult and stressful :(
Click to expand...


Your buying a property not the current owners problems, if they don't remove that clause walk away!
 
syd_newbie said:
....has anyone dealt with a similar clause??
Click to expand...

Yes. I agree with Collector. Get the clause stricken from the contract or rescind walk away (yes, I know that means you forfeit your 0.25% deposit + pest&building inspection).......but this will be cheap by comparision to the expenses of trying to move on a difficult tenant of someone else's making.
 
A similar thing happened to me. I was pushed for time as I wanted to settle June 30. The tenants wouldn't answer their phones and allow final inspection before settlement. I ended up settling without final inspection. The tenants stayed in for about an extra week. There was no written lease, just a verbal agreement. The tenants were friend of owners but relationship turned sour. I prob had to spend about $10k on possibly malicious damage. Just about everything electrical had cut wires and not working. Pool liner and equipment was completely damaged or stolen. I possibly got it a bit cheaper due to circumstances. Why don't you just find another property. Is it really cheap?? I'm sure if you walked away you wouldn't regret it. I got off easy!! It could have been a lot worse.
 
INVSTOR said:
A similar thing happened to me. I was pushed for time as I wanted to settle June 30. The tenants wouldn't answer their phones and allow final inspection before settlement. I ended up settling without final inspection. The tenants stayed in for about an extra week. There was no written lease, just a verbal agreement. The tenants were friend of owners but relationship turned sour. I prob had to spend about $10k on possibly malicious damage. Just about everything electrical had cut wires and not working. Pool liner and equipment was completely damaged or stolen. I possibly got it a bit cheaper due to circumstances. Why don't you just find another property. Is it really cheap?? I'm sure if you walked away you wouldn't regret it. I got off easy!! It could have been a lot worse.
Click to expand...

We think they may be friends of the vendor as well.. possibly even family and wanting more time to find another rental (it is quite hard at the moment we know).

It has a lot of potential compared to other properties we have looked at and the price is very good. We were prepared to put $$$ in to fix up the cosmetics and have it ready to go as our first home.

Sucks to get to this stage of the process and then walk away. Will talk to our solicitors on Monday and if they dont remove that clause then we will walk away and get back out there *sigh*

Thanks all :)
 
About 7-8 years ago when I was upgrading PPOR I was trying to purchase a house off a solicitor who was upgrading. He gave me a really hard time. After about a week of negotiating he agreed to accept my, 'subject to being satisfied with building inspection' clause. He accepted it at 5.00pm and allowed me 24 hrs to get it done. I rang heaps of builders until I found one who would do it at such short notice. When we contacted vendors they renegged again so sale didn't go through. I ended up finding a much nicer, bigger house on twice as much land for a few grand more. That house possibly had some building issues. i drove past it 6 months later, and thought yuck! I'm so glad I didn't buy that! I felt heartbroken at the time. Lesson learnt, don't get too emotional, there's alway better deals around.
 
Yep, we just need to follow the old saying 'Think with your head, not with your heart' !! Even if it is difficult at the time though ;)

If it's meant to be, it's meant to be.
 
I will take the opposite opinion to most, as usual.You will want a copy of the rental lease and a couple of questions you may want to ask are

1) is there a PM..if so speak to this person and ask for written confirmation that all required forms have been submitted to this tenant
2) if it is self managed, ask for copies of all forms submitted to the tenant

If everything has been done properly, a tenant can make life difficult if they refuse to move on time. There should be a condition report of the property when the tenant moved in.
If these safe guards are in place, and the tenant has a job, and you know the details of this job ..that's good enough.
Otherwise, have your solicitor with hold some funds until the tenant moves out. If this cannot be done..then consider walking away.
 
syd_newbie said:
we are in a similar situation where the property we are looking to purchase as vacant possession has troublesome tenants but the vendor has a clause that states contract will continue even if they are still there.Please tell me you haven't signed a contract with such a clause

In the cooling off period (where we are now) they have already requested an extra week for settlement in case they don't move out and the clause would cover them if they dont - has anyone dealt with a similar clause?? :confused: We have asked that they remove this but they have so far said no.Cool off now- this is already starting to smell-speak to your lawyer asap

We are having a hard time trying to see how the vendor will ever sell the property with this attitude.Vendor's problem not yours...unless you signed a contract buying off him. the tenants have trashed the place (mainly cosmetics - we will need to replace all blinds/carpets and replaster/paint all walls) and we agreed to a sale price with them fixing up a retaining wall which our P&B inspector says to allow for replacement because it isnt done properly.. and we are planning on negotiating the price further due to some plumbing issues that have since come up as well.Hang on...we are still negotiating price? Can you do that or walk away after signing the contract (a-yes you can with the right clauses- but I've heard about the other clauses in your contract....about no vacant possession where there is a problem tenant)

For our first home purchase, this vendor has pulled out all the stops to make it really difficult and stressful pull out all stops to find a better and easier property to buy:(
Click to expand...

That's my 2 cents for what is worth. It's ok to take on problems provided the price reflects the risk.
 
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