If I Purchase Rental Prop Are Old Leases Still Valid?
suppose i want to increase rent but then add a timely payment discount or change the date the rent is due, add other clauses etc
Do i inherit the existing leases or are they void upon purchase?
as i understand it, you get the leases. When the lease ends, it can the be changed.
Derek
Property is purchased subject to existing leases. You are stuck with the current leases until either the tenant vacates the property or the lease term expires.
Hi dna816,
If you are purchasing mulit-family buildings you may find that many of the occupants have been there for so long that they are simply on a month to month lease. In this case, all you need to give them is a 30 days notice that the rent will be going up and if they are interested in staying, provide them with a new and updated lease.
Best of Success!
BAMZ
BAMZ,
I caution that this rule of thumb may not apply in every rental area.
Every landlord should become familiar with their local landlord-tenant laws on this topic. I am aware of one county in MD that requires a 60-day notice for rent increases.
I just went through this. I took the tenants to the magistrate and had to honor the existing leases. Then I had to to send notice that I wouldn't renew the leases and follow the time period set by the local landlord/tenant statutes before beginning eviction procedures. I got lucky. I gave notice early that I wouldn't be renewing the leases so the two of the tenants decided not to pay rent. It was much easier to evict a tenant that doesn't pay rent!!!
Hey,
I know this is an old topic, but I thought I might present a different idea on the existing lease problem.
A lease, like any contract, is just an agreement between two parties and therefore can be broken if BOTH parties agree to it. This means if you both agree you can throw it away and start again.
Personally I don't think most tenants would allow you to raise the rent, as it would be damaging to them. So I would not ever try for that one.
BUT your lease better contain a lot more language than just the rent amount. It should be chuck full of do's and don't for the tenant. And you probably want those in place.
So how do you do that?
By making it appear that the old lease did not protect the TENANTS interests and your's does.
So for example, my lease spells out exactly how long it will take to get their deposit back and what condition the house would need to be in for it to be the complete deposit. This is exactly what the law allows it to be, so I am not doing them any favors, but they don't know that. And most of us know, that the deposit is a BIG concern for tenants.
Also, I spell out how they could break the lease early, if they wanted to.
You could also, put in how many people are allowed to live in the house, etc. etc. etc. Again whatever the law allows.
So now you say "Hi Mr. Tenant, I just bought the house and I wanted to say hello to you. How are things? (you better already know the answer)...blah...blah...blah...Hey, I was looking at your current lease and I don't know if you know this but it does not say how you get your deposit back or allow you to break the lease early (or whatever you want to say). I was thinking you might want those things. Here is a copy of my standard lease. As you can see the rent amount and the dates are the same. If you could sign here and here and here, we could make sure you are protected. Oh yeah, can you sign this piece of paper that says the old lease is null and void. Thanks alot and have a great day."
Done.