Wrap properties - Our rights??

[Peacock]

I have got a couple of properties structured basically the same way as a wrap property, but the contract is "licence to ocupy, option to buy". My management company is looking after the property for me, however, one of the licencees has not been paying their licence fee. Our management company issues them a default notice which states they have to pay the arrears for that period within 30 days, or they will be evicted. What they do, is just come up with the money before the 30 days is up which satisfies the default notice. But meanwhile, they are now in arrears for the next fortnight. This keeps happening time and time again.

When I raised this issue with my management company, they say that that is all they can do leagally, and they can't evict as they are not in breach of the contract. Surely i have the right to evict as they are not paying two weeks in advance as clearly stated in our contract agreement!! How can they keep not paying, and by law still be able to stay in the house?? The contract I have with the licencee, doesn't say much about the eviction process.

Can anyone shed some light on this matter, as my management company doesnt seem to be as proactive as I would like them to be.

Also, they refuse to send me copies of the default notices issued on my behalf, which I find VERY SUS!!

I would appreciate any comments from anyone who has experienced an eviction.

Regards,

Tony

 

[asy]

Tony,

It would really help if you put your location in your user id.

I guess you are in Queensland, as this is where the most license options are done.

Do you have a solicitor?

What has s/he said?

If you are in QLD and you need a good solicitor, let me know, I know one who specialises in 'wraps' and the like.

Your management company should be more than happy to send you copies of the default notices, I would press a little harder...

asy

 

[michaelg]

Hi,

From what I've seen, most lenders discourage such situations by charging penalties for late payments, in such circumstances the borrower soon finds its cheaper to meet their contractual obligations rather than abusing the service the lender provides.

You need to review your process and understand what penalties made be applied. Some banks charge up to $50 per arrears notice (one of the top 4 does that I know of).

And like everything you really need to discuss this with your legal advisor. If you contract allows you to vary the fees (which the Credit Code allows as long as fair notice is given) you may work with your solicitor to draft something like...

"A recent review of our portfolio and policy statement have forced us to review our fee and penalty policy. As of the xx/xx/xx we will be increasing our default penalty rate to x% and/or arrears administration fee to $y. Please note events that occur after this date will have the fee charge at the new rates"

But dont quote that without seeking legal advice, I'm just here to open your mind to options...

Regards
Michael Gruber