What Happens When Your Tenants Break Up?
With seven months to go in the lease term, hubby emails you to say that he and his wife are splitting up. He already moved out and he wants his half of the security deposit mailed to his new address.
You head over to your unit and catch the wife coming home from work. She says she’s looking for a second job, to be able to cover the rent on her own, adding that she may be a bit late on the next rent payment.
Property management is your business, not a charity project
Put aside all emotions – now is not the time to make decisions based on feelings.
Maybe you sympathize with the partner who got left behind. Perhaps you’re peeved at with the partner who took off and wants to violate the lease they signed with you.
Forget all that – the first thing you need to do is protect your asset.
Attorney and Minneapolis Star Tribune legal columnist Kelly Klein told a landlord in this situation to first review the lease agreement and then consider the options. If you drafted your lease contract properly, it should list both the husband’s name and the wife’s name. If so, then both are liable for the rent, whether or not one moves out, Klein said.
“If both are named, then they are jointly and severally liable for the rent, which means that they are each individually responsible to pay all the rent, whether the other person pays or not,” she advised.
Your rental agreement also dictates how you should handle return of the security deposit. It doesn’t get disbursed until the end of the lease term, when the unit is empty and you inspect it and itemize any damage. Only then, do you release it to the tenants named in the lease. Most states require that any deposit money be returned via check and with both names on it. It is up to the tenants who split up to figure out who gets what.
Demand Media columnist Tony Guerra says that, although the landlord must determine whether to let a divorcing couple out of their lease, a court-approved divorce agreement can spell out which partner is responsible for lease payments.
Should you let one or both of them out of the lease agreement? What about allowing a new roommate for the remaining spouse?
Let’s be honest, though. While the law may be on your side, you’ll also want to apply some common sense if your tenants split up. You could be saving yourself considerable hassle in eviction and collecting if you weigh any reasonable suggestions your tenants make.
If both want to move out, one option is offering them a mutual early lease termination agreement, with a one-time early termination fee. If one partner wants to take on a roommate, remember that new arrangements require new lease agreements and new tenant screening. Screen the roommate’s rental application just as you would any other prospective renter before drafting and executing a new lease agreement.
And, before deciding whether you’ll permit a tenant to try to go it alone in your unit, make sure he or she will be able to cover the rent.
New research shows that divorcees over 50 are a growing segment of the rental population. Some may not have sufficient income, or maybe their partner was the one with good credit and the remaining partner has poor credit history. If that describes a tenant who wants to stay on alone in your unit, you can tap other sources to verify ability to pay, such as recent bank statements and pay stubs, and perhaps a lease cosigner agreement with a third party willing to guarantee the rent payments.
Don’t leave your next step to chance
When tenants say they’re splitting up, it can be difficult to know what to say and when to say it. You can’t go wrong in giving yourself time to think. If you’re not sure how to handle something, ask a landlord-tenant attorney.
Tempting as it may be, don’t get pulled into the couple’s bickering. Don’t tell one what the other is saying. The only way their problems are your issue is if the rent goes unpaid.
Two important tips:
- Don’t change the locks. Unless one partner has a restraining order on the other, both have a legal right to enter the unit until the tenancy is officially terminated.
- Don’t amend the old lease or sign a new lease agreement without considering how it will affect your ability to collect rent. Klein advises landlords not to accept partial rent payments from splitting couples without making sure you know which rights you may be forfeiting. If you take partial payments, it means restarting any existing eviction actions you’ve started.
Finally, any amendment or new lease agreement that comes from the split should get your usual move out/move in treatment. Inspect your unit, release whatever portion of the security deposit is due back to the renters, remind your tenant(s) of their responsibilities, and collect a full new security deposit, just as you would with any other new tenancy.
Just like your tenants who split up, you’re starting over. And, just like them, you want your next relationship to be a good one.