Tenants behind on rent and damage

Hi All!

Unfortunately this wont be the most uplifting first post on PropertyChat but I need some insight into this and 'what would you do' advice if you were in my shoes. So I'll give you as much information as possible.

Tenants moved in as a couple in mid September, broke up a few weeks after that, the male stayed, female left. Continued paying rent until mid-late December and then stopped completely. He illegally sub-let the property to family members and failed to notify the PM.

Late January my PM applied to VCAT for rental arrears and eviction of the tenants, the court hearing is on Tuesday. My neighbours have recently advised that a side fence has been taken down during the occupation of the property. If this is in-fact true, I have the following offences recorded;

- Arrears of more than 14 days
- Sub-letting
- Possible malicious damage

During the last few weeks he's been paying small 1/2 payments every few weeks, which I think is a ploy to try and extend their stay..

My questions going forward are;

- If VCAT rules to allow them to stay and make small payments, do I hire a solicitor reverse the ruling?
- Can I use the bond money to cover the repairs costs?
- If they get an eviction date and are not gone by the date, what's the next step?
- What would you do if you were me?

Thanks for reading.

 

Cry

Fortunately, I haven't had to go to tribunal/court, but I feel your pain - I recently had to deal with fixing a lot of damage to a place, and while we managed to get them to catch up on rent before getting them out, they left with a 4-figure sum owing on water. It's a horrible feeling.

Whatever the outcome, I hope you're successful, and the tenants pathetic attempt to pay small amounts every few weeks won't give them the right to stay. Good luck - keep us informed.

 

No its not their jurisdiction

Yes, after lease has finished (either naturally or by eviction)

In Vic police will assist, seems easier there from what I've heard. Here we have to book a sheriff who could be booked out for a couple days.

What does your PM recommend? This highlights the need for a good PM - everything seemed rosey at the start then all it takes is for someone to lost their job or relationship and everything spirals down hill from there.

 

Thanks Kay! I'll need all the luck in my corner on this one, we'll see what the member says.

Yeah my PM is a little out of his depth in this scenario, my plan is to see how the court date rolls and then transition to another real estate.

 

As DT advised once you have the possession order from VCAT the warrant is purchased and executed by the police. On the day of the warranty the agent along with a locksmith would attend, police remove tenants (if still there), locks changed then you can inspect and work out what needs to be done (cleaning, repair damage etc)

Once you have possession you can then make an application to VCAT against the bond for arrears and any costs for cleaning etc. If you have a good landlord insurance policy they would cover loss of rent and tenant damage so would be a good idea to check your policy to know in advance what you are covered for

 

Thanks Sharyn, yep one step at a time, I can't see why the hearing won't go our way but then again, you don't know what case the tenant will plea. I have EBM full cover so I'll put in the application once we have possession once more.

On the insurance process, the real estate has put in a claim for the rental arrears, do I still claim against insurance for this money, even if the court awards us this? the EBM claim form also asks for repair costs, will this money be claimed against the bond, or will the insurance cover under their policy?

I guess I'll uncover this information as I go along, curious if anyone has already been through the process.

 

Correct me if I'm wrong because my knowledge extends from Queensland (QCAT), but your PM has made a court application for possession- they will not hear on compensation for the arrears in this case, that is another case that would be made later if you didn't (thank god) have insurance.

At this stage you and your PM need to do everything possible to prove why this tenant should be made to leave. I'd hazard a guess that from what you've given me, the situation may not be dire enough to assure you vacant possession with VCAT's tenant-biased rulings.

 

[Yeah my PM is a little out of his depth in this scenario, my plan is to see how the court date rolls and then transition to another real estate.[/QUOTE]

I'm thinking why wait? If you think there's someone better that can sort this out change now? The old PM will likely be relieved to be rid of the problem. And if the new PM is good at these they won't consider it a hassle.

 

PM has applied for possession and arrears on the paperwork, so the member will hear both today. If possession doesn't rule in our favor today I'll process the insurance claim and get the ball rolling. Every week that passed is a loss to me unfortunately.

They've broken 3-4 of the tenancy act laws already and being over 30 days in arrears I think it should be enough to throw them out, but I won't be holding my breath.

Because the current RE company has applied to VCAT in their name, so depending on how today goes, I'll be making some changes after that.

 

Quite ridiculously, tribunals don't like new agents attending regarding issues occurring during previous management.

 

Good result team, the member for VCAT ruled in our favor and granted a warrant for possession. Given the time period of arrears they were going to make it immediate however given their situation we allowed an additional 6 days and an option to try and make up the funds.

I think going forward the best thing to do is to re-tenant the property.

 

Congratulations! I’m thrilled for you that my pessimism was unjustified!

 

Congratulations! you got possession order finally. My tenant has been in rent arrear for 4 months but they payed before hearing, so they are still living in my property. I think the reason you successfully get possession order is because your tenant is 30 days arrear before hearing.

 

I also want to ask, have you got all rent loss and cost of damage back from EBM? I have similar issue and same cover as you have.

 

I think so too, the member saw that the tenants had no financial way of paying back such a significant debt, and pay the normal weekly rent at the same time.

The real estate supposedly submitted the claim documentation today, so I'll keep you posted. I'm not banking on getting everything as as insurance companies are, they want a paper trail for everything and some will be regarded as wear and tear.

To make matters worse, the real estate 'lost' my condition report. I'm at the stage where it's better to laugh than cry.

 

They lost intial condition report??? That is key to verify all damage! they need to send you a copy when they finished that, they are incompetent!

by the way, why you apply for VCAT 2 for compensation? you have landlord insurance, you can get you loss no matter from rent loss or damage from insurance company.
Are you trying to get compensation of what landlord insurance company not cover? For example, your total loss is 3000 but insurance only cover 2000, so you claim for compensation of 100 from tenant through VCAT?
Or you could do both claim on the same time? One way is through insurance and can also apply for VCAT to ask tenant to compensate the same?

 

They did! and blamed a 3rd party company for the data loss (not buying it) and I never received the condition report initially either, I would have kept a copy myself..

I'm potentially looking at making a civil claim against the agency if it affects my claim significantly.

I'm not 100% sure on the processes either to be honest, but we're processing both claims at the same time, I'm under the belief the insurance company expect that the tribunal case has been put forward as a backup, so they can get the money from the tenant legally.

You're not allowed to double dip, so if VCAT award something, insurance may not pay it, I'm still learning how this all works so my questions will be answered once this all settles.

 

Thanks, I learn a lot from you.

 

Just because you have insurance doesn't mean you shouldn't try to recover whatever is possible from the tenant, apart from anything else it makes complete sense to do so.

For example:

• reducing the amount paid out in claims helps keep premiums down for everybody, the higher the claims paid the more likely premiums will increase in the future
• surely it is best to hold the tenants accountable for their actions, and try to to make them pay rather than letting them get away with it, to simply move on and do it to another landlord?

 

Yep, just evicted a tenant last week from a property, also due mainly to a relationship breakdown. About 4 months behind in rent as we had to follow a particular process and it took time. Tenant lied the whole time on about every count.

Went for a look last Saturday and discovered he has left all his possessions, including a car body out the front as well as a car parts scattered everywhere in spite of him telling me he only had a "few more things to move".

Insurance claim has been lodged and will receive an outcome soon of what will be covered.

Property investing can be smooth sailing or a train wreck so make sure you are insured and got a decent PM going into bat for you. The current one is awesome, unfortunately there was a turn over of 3 different PMs in a 12 month period that added to the drama.

It will all pan out in the end.