May 1, 2023
Last Updated
In this episode, Podcast Host & Community Manager at RentPrep, Andrew Schultz, chats about a landlord that was fined over $10,000 for having too many tenants occupying a rental property.
How do you handle an unresponsive tenant? We’ll go over the process for managing a tenant that just won’t respond to your messages and you now have to initiate the eviction process.
Last, but not least, how do you go about verifying the income of someone that was a former military member? Find out this and more in our latest episode.
Show transcription:
Andrew Shultz: (00:00)
Hey everyone. Welcome back to another episode of the Rent Prep for Landlord’s podcast. This is episode number 402 and I’m your host, Andrew Schultz. On today’s episode, we’re gonna be talking about a landlord find for having too many tenants in one home, eviction set outs and unresponsive tenants, and how to verify income for veterans. We’ll get to all that right after this.
Voice Over: (00:26)
Welcome to the Rent Prep for Landlords podcast. Now, your host, Andrew Schultz.
Andrew Shultz: (00:31)
If you join the free Rent Prep for Landlords Facebook group, our group members get access to our Sherwin-Williams and TPG Paint Discount programs. Can ask questions in our monthly AMA sessions and if you have a question or a situation that you’ve never encountered before or just need to bounce an idea off a group of over 13,000 housing providers, this is the place. If you haven’t checked that out yet, do it today over at facebook.com/groups/rentprep. Don’t forget to mention the podcast when answering the questions so we know how you found us. We’re gonna start things off this week with an in-the-new segment. It’s been a while since we’ve done one of these and I’m kind of excited to bring this article to you because it’s a particularly interesting one with a pretty obscure law being referenced. This comes to us via the Foster’s Daily Democrat and was written by Karen Dan Durant. Title of the article is Durham Landlord fined for allowing too many U N H students to Rent Property again.
Andrew Shultz: (01:25)
After the town recently received $10,000 from a local landlord who allowed too many tenants to live in a rental property. The town’s fire Marshall said he hopes to use the latest code violation as a teaching moment. Durham was awarded the settlement payment in a motion for contempt, a civil penalty due to a violation of a 2020 settlement by Tashi Capital Group L L c, which owns several rental properties in the town housing at 26. Trafford Ave often rented the University of New Hampshire students was found to be rented to four students. That’s one more than the building code allows. According to Brendan o Sullivan, the fire marshal for the Durham Fire Department, Fred Kell, manager of Tashi Capital Group in Dover was renting the property in violation of the Durham zoning ordinance, which limits occupancy of the property to no more than three unrelated persons. According to town officials, Cal admitted to the violation and Tashi Capital Group also owns properties at 14 Edgewood and 21 Edgewood Road, which at times half been over-occupied as well as properties at nine Dover Road and 17 to 19 Edgewood Road.
Andrew Shultz: (02:26)
Kell could not be immediately reached for comment. Audrey Klein Durham’s code enforcement officer said that there was a similar judgment back in 2020 involving 14 Edgewood Road. In that case, Kell also admitted to overoccupancy and paid a fine of $4,929 and 40 cents. He was given terms for future rentals including providing information about the tenants to include their cars and license plate numbers. While Sullivan said that he hopes the recent decision and fine sends a message to other property owners, the town has codes governing the use of property and it will enforce them. If there are issues, give us a call. Sullivan said Klein and I will try to work with you to get things back on track. We’re in the business of enforcement and deterrence, not bill collection. I would prefer to resolve issues amicably. The most important code standards of Sullivan said are that the town will enforce our life safety equipment such as smoke and carbon monoxide alarms, proper identification of the building so emergency crews can find them compliance with fire safety codes and that all spaces have a second means of egress even if it’s a usable window. The recent settlement agreement with Tashi capital states for the next seven school years, copies of each of the leases for all six properties as well as contact information for each tenant, including license plate numbers of the tenant’s vehicles will be submitted to Durham’s code enforcement department. The town is also entitled to two inspections per semester of all the properties upon 24 hours’ notice without cause, as well as additional inspections of any of the properties if there is cause.
Andrew Shultz: (04:03)
So that is a very, very interesting article. I have a lot to say about it, but we’re gonna go ahead and break it down a little bit. I find this article really interesting because they’re essentially using an archaic law to police landlords and prevent them from renting to what the town feels is too many unrelated people. I also find it interesting that they are targeting this landlord in particular who rents predominantly to college students. The town is essentially using an old law in order to prevent landlords from renting to what they consider to be too many college kids. I’m betting that there were probably a lot of complaints from neighbors in the area about parties and debris and things like that, which is why the town is now enforcing it on this landlord. With these tenants, we used to manage about 30 doors of student rentals in mostly single families and duplexes and the entire neighborhood was predominantly college rentals and it definitely looked like it, especially on Sunday mornings.
Andrew Shultz: (04:54)
So I can understand the neighborhood wanting the township to do something here, but the problem is that these lost stem from a long time ago, and honestly there are still quite a few places with legislation like this on the books. In fact, this is actually an issue in the town where I went to college, there was an old archaic law on the books that stated that no more than, I can’t remember if it was three or four unrelated women could not live together under the same roof. The law specifically cited women. I don’t believe that there was a restriction on the number of unrelated men that could live in a house, and I know of several houses that had five or six guys living in them, all of which were on the lease. Here’s the thing though, no one ever enforced this law. Apparently, it’s substantially easier to just ignore a law that’s on the books than it is to actually remove it.
Andrew Shultz: (05:39)
So they just kind of stopped enforcing it one day. The concern was that having too many women under one roof would create a bra [inaudible] for lack of a better term, and the town absolutely did not want that to happen. So that was their solution for better or worse, and I think that’s probably what happened in a lot of towns where this type of legislation exists. I think we’ve graduated to more reasonable mindsets at this point where these laws are no longer in a position where they make sense and it’s time to remove them from the books. A couple of other interesting items worth considering. This law flies directly in the face of the HUD guidelines regarding occupancy, which typically state two adults per bedroom and have additional allowances for common areas and things of that nature. Limiting occupancy to no more than three unrelated parties would mean a good chance of a four or five-bedroom house not being able to rent for as much as it should, simply because the town is standing in the way of the landlord generating revenue from that property at full occupancy.
Andrew Shultz: (06:35)
The township is essentially artificially controlling and limiting the housing supply in this town, and I’d be curious to know if this artificial limit forces students to look for housing further from campus as the closer rentals fill up to the artificial capacity set by the town, thus spreading the so-called issue further on into other neighborhoods. I have a big issue with the last part of this article, which talks about submitting copies of the leases, contact information plate numbers, et cetera for the tenants in these buildings. I’m 100% against that. I’m not an attorney, but I feel like this is a violation of the privacy of these tenants and I also feel like it’s borderline interference in a contract. I also have a lot of concerns about the fact that the town can just decide that they wanna inspect your property with 24 hours’ notice and you have to permit that up to two times a year without cause and then as many times as the town decides, they want to go in and take a look at it if they’ve determined that they have found cause, whatever cause might be really not a big fan of that at all.
Andrew Shultz: (07:31)
This is one of those situations that feels a lot like government overreached to me and I would go ahead and say, no way, big Brother. Stay outta my house.
Voice Over: (07:44)
Forum quorum where we scour the internet for ridiculous posts from landlords and tenants.
Andrew Shultz: (07:52)
Moving on to our next segment today we have a forum quorum for you. This one comes from the Rent Prep for Landlord’s Facebook group. Let’s go ahead and jump right in here. I’m currently going through my first eviction. The courts have approved the eviction and I’ve been told by the clerk that there are 800 evictions and there’s no way of knowing when the tenant will receive her three-day notice to leave the property. Her lease ends April 14th. She’s not responded to any calls, messages from our portal or text from our portal notifying her of the lease and move out. I’m not sure if it’s wishful thinking, but I’m hoping she leaves when her lease ends. Any suggestions on how to handle this situation? And again, this one comes to us via the Rent Refer Landlord’s Facebook group. You’re in a much better position than you realize, but it’s gonna take some time for this one to iron out.
Andrew Shultz: (08:37)
I’m going to assume that the tenant will not leave on April 14th at the end of their lease term. They’ve already been through the full eviction process and they’re likely not going to leave at the end of the lease, but they’re going to wait until the very, very bitter end of this to be out of the apartment. Unfortunately, there was no state referenced in the post. So I’m gonna gonna explain my experiences here in Western New York, particularly inside the city of Buffalo. So I say that you’re in a better position than you realize because you are already in line for your set. I understand that there are a lot of people in line ahead of you, but the longer that you delay getting in line, the longer you have to wait for your set out. So just being in line at this point is a good spot to be in, assuming that the tenant moves out on April 14th.
Andrew Shultz: (09:18)
At that point, contact your attorney to see if they recommend canceling the set appointment or if they recommend seeing it all the way through to the finish line. Even with the tenant being removed from the property, different states will have different laws on when you can actually reclaim the unit. So it’s worth finding out if you can reclaim it once the tenant moves out or if you do need to finalize that eviction process. By having the set out completed, pretty much every court is going to have some sort of delay between the time that you file for your set out and the time that the set actually happens. It’s gonna be different in pretty much every court, but here in Western New York it seems to take somewhere between 15 and 30 days for most set outs to occur. Once you paid to have that set out completed, some states will actually dictate a minimum amount of time it has to elapse before a set out can actually occur.
Andrew Shultz: (10:02)
So you’re gonna wanna check your state laws and find out if you have any restrictions like that that you have to deal with here in Buffalo. Once we’ve been through eviction court and when the, when the eviction case, uh, the judge will typically issue a warrant for the set-out and there’s a date listed on that warrant that states that it cannot be executed before that date. We then have to call the City Marshall Service the morning before the warrant is allowed to execute, provide them with the docket number, and then call back in that afternoon to find out what time the Marshall Service can meet us at the property the following day. On the day of the set-out, we arrive at the property and meet with the Marshall onsite. We approach the apartment along with the Marshall and the Marshall knocks on the door to see if anyone actually comes to the door or if anyone’s even still residing in the property.
Andrew Shultz: (10:46)
If someone answers, he tells them that they need to leave the premises and that they’ve been evicted and he’ll typically give them a few minutes to grab some of their belongings. And if no one answers, we either key into the apartment or drill out the lock. If the tenants have changed locks on us and then we walk through the property with the Marshall to actually verify that no one is remaining inside. At that point, we can re-key the property and check on all the other windows and doors to ensure that those are locked and the property is secure. And then there’s also some laws in our state with regards to disposal of tenant belongings. So the tenant stuff either needs to be packed and moved to a storage unit for a period of time or held inside the unit for a period of time before we can dispose of it.
Andrew Shultz: (11:25)
But as far as the actual set-out itself goes, that’s considered complete and the unit is considered back in our possession once the marshals have come to the property for the set-out and post notice on the doors stating that the eviction process has been completed and that the former tenants are no longer allowed to occupy the unit. So my recommendation is to continue handling the situation exactly as you have been. Check the unit after the end of the lease to see if they’re still living in it and if they are still living in the unit, follow through with having them set out of the unit. Just as soon as you get to the top of the list. Being on the list is already a good thing because at least you’re moving up the list as time progresses. And my honest recommendation here is to probably continue all the way through the set-out phase, even if the tenant leaves early because then there’s no question that they have been officially evicted from the apartment. Good luck and hopefully your unit isn’t damaged too badly once you get it back.
Voice Over: (12:16)
Water cooler wisdom Expert advice from Real Estate Pros.
Andrew Shultz: (12:25)
Our final segment this week is our water cooler wisdom segment. This one also comes to us via the Rent Prep for Landlord’s Facebook group. Let’s go ahead and dive right in here. Hi everyone. I’m looking to rent my second property out to someone who’s been in the military. Their monthly income is lower than my required minimum gross income amount, however, they told me they get VA disability and VA education pay for the rest of their income. Is there a good way to verify this income? Thank you for your help. And again, this one comes to us from the Rent Prep for Landlord’s Facebook group. So VA disability pay can be verified from a VA benefit letter, which is issued to the vet by the VA office. Once they’re awarded their disability rating, the vet can actually manage their VA disability pay online, which includes getting a copy of their benefits letter as well as a copy of their payment history, which is probably what you’re gonna want to use for the actual income verification.
Andrew Shultz: (13:15)
They could also do things like change their direct deposit information and quite a bit more from the VA’s website. You can request a copy of the benefit letter and or a copy of their payment history, which would probably be the easiest way to verify this income if they’re using direct deposit. You could also verify the deposits from their bank statements. It’s also worth noting that VA disability is tax-free at the federal level and also at most state levels. So keep that in mind while you’re completing your income verification. And finally, I wanna make a note that this income is considered very, very, very consistent and almost never changes. And if it does change, typically it only goes up on a yearly basis as cost of living goes up. Now, VA education benefits commonly referred to as the GI bill work pretty similarly. There are a couple of other programs out there that are less common and predominantly used by older vets, but the verification process is going to be very, very similar.
Andrew Shultz: (14:11)
The vet can download a copy of their VA education benefits letter online probably through that same portal as well as a copy of the payment history for the VA education benefit. These benefits come to the bank account of the vet as a cash deposit and they’re not specifically earmarked towards school or towards housing or something along those lines. It’s considered cash money that they can use however they see fit, which in theory should be used for educational purposes, including housing. When you’re doing a verification on the education benefit, you really need to get a copy of the payment history. In doing research for this segment, I spoke with a vet who’s also a client of mine and they explained to me that the education benefit is very, very inconsistent. First, the benefit is only paid while the vet is actively taking classes. The benefit changes depending on whether the vet is full-time student or a part-time student.
Andrew Shultz: (15:03)
And will also change if they go from full-time to part-time or part-time to full-time at any point during their education. The program does not pay out during breaks, including short breaks such as winter recesses and things of that nature. But if the vet is not enrolled in classes during the summer semester for instance, then they’re not getting any of this education benefit deposited into their bank account during that timeframe. And the program also pays out different amounts based on the length of service, the location that the vet is going to school, and several other factors. So just getting a copy of the benefit letter would not be enough in this circumstance. You’re going to want to get a copy of the payment history as well so that you can see what the vet is actually receiving on a monthly basis. This is probably one of the more complicated forms of income to verify, but once you get ahold of the actual payment history, it makes it a lot easier to take a look at everything as a whole.
Andrew Shultz: (15:55)
And that would be my recommendation in both instances would be get not only the benefit letter but also a copy of the payment history. You’ve heard about tenant screening, but have you ever heard about pet screening? You can run a background check on your tenants pets just like you can on renters. Find out everything you need to know about pet screening today in our latest guide. You can find that over at rentprep.com/blog. That pretty much wraps up this episode of the Rent Prep for Landlords podcast. Thank you all so much for listening. We truly do appreciate it. Our goal with the podcast is to help as many people as possible make educated decisions when it comes to real estate and you can help us to reach our goal. If you heard anything in this week’s episode or any of our other episodes that will help someone that you know, please do us a favor and share it with them.
Andrew Shultz: (16:41)
If you’re looking to get in contact with me, I can be reached over at whatsdrewupto.com. From there, you’ll find links to everything going on with me over at Own Buffalo, as well as other projects that we’re working on. Don’t forget to grab a free copy of our deal analysis tool today over at whatsdrewupto.com. There’s no obligation and it comes with a companion video to show you how to use it. If you’re looking for top-tier tenant screening services, head on over to rentprep.com. There are multiple products to choose from, including tenant-paid options, and if you’re over 50 doors, ask about the enterprise-level programs and pricing. I’ve been an enterprise user of Rent Prep for over a decade now, and it’s definitely changed the way that we screen our tenants. Check that out today over at rentprep.com. Again, thank you all so much for listening. We’ll be back in a couple weeks with an all-new episode that you won’t wanna miss. Until then, I’m Andrew Schultz with ownbuffalo.com for rentprep.com, and we’ll talk to you soon.
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