Month to Month Agreements
Los Angeles Property Management companies say if your tenant is renting on a month to month basis, you need to give your tenant proper notice. This would involve mailing or delivering a letter to your tenant 30 days before you’d like them out of the property, normally in respective to the due date for rent. Los Angeles Property Management companies note that the required notice period can vary from state to state, be sure to look the state’s policy.
A Los Angeles Property Management company doesn’t need a reason to terminate a month to month agreement, that’s why it is called a “no cause” termination. Los Angeles Property Management companies consider this a benefit on having a month to month agreement. There’s no need to tell the tenant why they need to vacate, unless the Los Angeles Property Manager wants to.
Example of what to do:
- Must send a letter with the date on it letting your tenant know that their tenancy will terminate in X amount of days from the date of the notice or next rent due date (again depending on your state).
- The Los Angeles Property Manager must also inform the tenant to remove all possessions and return the key(s) to the front office on or before the last day noted in the invoice.
- If for whatever reason they don’t move out, the eviction process can begin immediately.
Fixed Term Leases
Los Angeles Property Management companies say that fixed term leases require more of a delicate touch and don’t typically terminate because a property changed owners.
Five Options On Handling A Tenant With A Fixed Term Lease
1. It’s very important to wait until the lease expired
Los Angeles Property Management companies state that if you have a tenant and they’re in good standing with the lease, the best method would be to wait to sell the property when the lease is up and the tenant moves out.
Although, if a tenant violated any lease terms, termination of the lease would move along very quickly with the proper notice of course. Valid reasons for a lease termination include:
- Not paying rent
- Involved in illegal activities in the unit
- Violation of a no pet clause
- Subleasing is prohibited
- Serious property damage
- Being a bothersome tenant to others
- Submitting false information on the rental application
2. Selling the Property with an Active Lease
Los Angeles Property Managers state that this option limits a prospect because you would have to sell to someone who understands that a tenant is living in the property, not knowing if the Property Manager would be ok with that. You are limiting yourself to investors, basically.
It’s very important that the new owner honors the tenant’s lease agreement and lets the tenant live in the property until the end of the lease.
In about every state, the lease and security deposit must be transferred with the property, and also when a new owner steps in as the new landlord. A fixed term lease cannot be terminated when a property is sold.
3. Paying off your Tenant to Vacate
Los Angeles Property Management companies say if the property owner wants to sell and a tenant still has a few months left on the lease, Los Angeles Property Management companies can try to negotiate a settlement to get the tenant out early.
This is called “cash for keys”.
- Making up the difference.
See what properties can be compared to yours in the area. If rent happens to be more than what you’ve been charging, Los Angeles Property Managers suggest to offer to pay the difference between what the tenant will likely have to pay and what they have been paying, plus times the amount of months that are left on the lease.
- Moving costs.
Los Angeles Property Management companies sometimes offer some money to help a tenant move for the inconvenience of moving earlier than they expected.
- Pay for their security deposit.
Los Angeles Property Management companies often offer half of what your tenant would need to move into a new place, this is usually first month’s rent and the security deposit.
- Whatever you can afford.
The bottom line, when forced out of a lease early by Los Angeles Property Management companies, it depends on how much you want your tenant out early, and also how much can the Los Angeles Property Management company can afford to give the tenant.
Please do keep in mind, that the tenant is absolutely under no obligation to agree to whatever terms the Los Angeles Property Management company gave. If that is the case, the Los Angeles Property Management company would need to wait until the end of the lease to sell the property.
4. Selling the Property to a Tenant
Los Angeles Property Management companies may sometimes offer to sell the property to a tenant. Allowing them to get financing on their own, or they’ll offer a seller financing arrangement, this is a type of transaction where the Los Angeles Property Management company is the lender and allows the tenant to make payments (on a short term basis of course) to buy the property.
Seller financing is extremely captivating of an offer to long term tenants that are in good standing.
Also another thing to keep in mind is that you normally need to own the property free and clear and/or get approval from a mortgage lender to conduct a seller financing deal.
5. Early Termination Clause in the Lease
There are cases where tenants, and even those in good standing, don’t get to live out the entire lease agreement. A few leases have an early termination clause that handles a variety of situations.
Los Angeles Property Management companies say these clauses normally state that the lease terminates in 30,60 or 90 days. An example would be, after closing on the sale of the property. The “trigger” could be anything, Los Angeles Property Management companies say as long as it’s reasonable, and the two parties agree to everything in the lease.
For the latest in Los Angeles real estate and Los Angeles property management news, trends and tools, make sure to stay connected with our blog at: http://tgnpropertymanagement.com/blog/