Author Topic: What to do when someone who's renting your garage for storage stop payment  (Read 8392 times)

Megatron

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We are in the process of closing on a short sale house. The garage is currently rented out to someone by the seller. He said that the person has not been paying the monthly rental fee and has not been answering his phone. It is being used to stored his classic car. What legal action could / should I take once we close on the house. I think at this point the seller is in a "take it or leave it" mode.


waltworks

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Have car towed, change locks.

-W

matchewed

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If you want to take legal action you'll need to contact a lawyer.

If you don't want to take legal action ask for the contact information, call, leave a message or tell the individual that they have X days to get their shit out of your garage. After X days get it towed.

Numbers Man

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How about your attorney requiring the seller to remove his property before closing.

Another Reader

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If you close on this property, you inherit the tenant and all the issues.  Ask the seller for a copy of any written rental agreement and if there was a deposit.  Technically they should give you the deposit, but good luck with that.  Get the name and last known address of the tenant.  Once you close, you will have to go through the eviction process in your state.  If you attempt to remove the tenant's property without a judgement, you may be liable.

escolegrove

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Before you close on the property check with a lawyer to see what that is considered residential or commercial. There are very different rules for commercial than residential. On commercial leases you can are allowed to lock the tenant out. After they haven't paid in so much time you are allowed to sell the items for the pay you are owed. Residential is TOTALLY different. If it is residential you could for a rough 2-6 months depending on your states laws.

KBecks2

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You may need to give a formal legal notice.  Go ask this question over at Biggerpockets.com and include your state and they should be able to help you.  Good luck.

Daleth

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How about your attorney requiring the seller to remove his property before closing.

This. Most likely local law requires the landlord to evict in cases like this--you probably can't just tow the car and change the locks. So, make that a condition of your purchase--it's the seller's problem (why didn't he deal with it sooner?), so he/she should take care of it. It will probably cost a few hundred bucks because unless the landlord is experienced with evictions, a lawyer will be required to make sure it's done right--since if it's done wrong, the tenant could sue and that's a total PITA.

Fishingmn

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This. Most likely local law requires the landlord to evict in cases like this--you probably can't just tow the car and change the locks. So, make that a condition of your purchase--it's the seller's problem (why didn't he deal with it sooner?), so he/she should take care of it. It will probably cost a few hundred bucks because unless the landlord is experienced with evictions, a lawyer will be required to make sure it's done right--since if it's done wrong, the tenant could sue and that's a total PITA.

It's not the sellers problem. It's a short sale. The seller is NOT going to pay to do an eviction since they have no money and are going to walk away with nothing from the sale. If anything it's the bank's issue as they will have to proceed with an eviction should the short sale not happen and they acquire the house via foreclosure.

Best bet is to try and get hold of the car owner to get the car out. Maybe impress upon them that if the sale doesn't proceed the bank will foreclose and for all you know they will just take the contents and it will be up to the car owner to fight a legal battle with a well funded bank.

Personally, I wouldn't close on the house until this is dealt with.

Bobberth

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I'm no expert in this area but I will add my 2 cents anyway.  I was at a storage auction once and they opened the door and there was a Harley in there.  The manager then shut the door and said he can't proceed with the auction because the motorcycle had a title and that has to be handled different than non-titled items.  You can't just take a car, there is a title and the legal process for changing hands has to be handled properly.  Definitely find a local attorney that will help you follow the law in your specific area and there could be big differences in how you handle an abandoned car on your property.  This is no time to cheap out and try to handle everything yourself.  Grand theft auto is not what you're looking for with this purchase.

usmarine1975

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Contact the local District Justice or your attorney to find out what the laws are locally.  I won't even say what I think because every location has different rules.  A lot of good points have been brought up.  The one I liked the best is Figure out what you will be required to do before you finalize your purchase.  Then you can decide who should deal with it.

SpicyMcHaggus

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You get a mechanics lein on the vehicle.

1) send a certified letter to the owner at last known address, giving 30 days notice.
2) have police come and ticket vehicle for parking on private property.
3) set up a deal with a local tow company to remove the vehicle for you to their lot. It incurs storage fees and towing cost. If the owner does not show up to claim and pay for it, they can put a lein on it and it can be declared abandoned. The title passes to them. 

If you are smart about this, and the car is worth any money, you will either buy it back from the tow company to sell for profit, or have the tow company agree to pay you a portion of its value should they gain legal ownership of it.   


If this all sounds like too much trouble for you, push it out into the street and it will get towed by the city eventually.

libertarian4321

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Call the loser who isn't paying.

Leave a message saying that you will be having a "everything must go" garage sale in one month if you don't receive payment (or he doesn't move his crap).

Daleth

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It's not the sellers problem. It's a short sale. The seller is NOT going to pay to do an eviction since they have no money and are going to walk away with nothing from the sale. If anything it's the bank's issue as they will have to proceed with an eviction should the short sale not happen and they acquire the house via foreclosure.

Best bet is to try and get hold of the car owner to get the car out. Maybe impress upon them that if the sale doesn't proceed the bank will foreclose and for all you know they will just take the contents and it will be up to the car owner to fight a legal battle with a well funded bank.

Personally, I wouldn't close on the house until this is dealt with.

The fact the seller likely doesn't care is a good point (although they may care--they may want out ASAP and be willing to deal with the problem to avoid delay), but the "best bet" depends completely on what the laws are in your state. Getting ahold of the car owner may have nothing to do with getting him out under state law. Not to say the OP shouldn't try and contact the guy, but he certainly should not postpone talking to a lawyer until after he tries that. It's entirely possible that all he needs to do under local law is post an eviction notice on the property, wait X days and then have the car removed. But since X days could easily be 30 or 60 days, he needs to know that ASAP and get that underway if necessary, rather than wasting time looking for the renter.

Also, he can't do any of this until he owns the house. Most likely the only person who can start the process is the owner/landlord. I see no harm in talking to the seller and asking him to START this process so that the OP in effect "inherits" an eviction process that's already underway and nearing the point where the OP can have the car removed.

Daleth

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You get a mechanics lein on the vehicle.

1) send a certified letter to the owner at last known address, giving 30 days notice.
2) have police come and ticket vehicle for parking on private property.
3) set up a deal with a local tow company to remove the vehicle for you to their lot. It incurs storage fees and towing cost. If the owner does not show up to claim and pay for it, they can put a lein on it and it can be declared abandoned. The title passes to them. 

If you are smart about this, and the car is worth any money, you will either buy it back from the tow company to sell for profit, or have the tow company agree to pay you a portion of its value should they gain legal ownership of it.   


If this all sounds like too much trouble for you, push it out into the street and it will get towed by the city eventually.

Before you close on the property check with a lawyer to see what that is considered residential or commercial. There are very different rules for commercial than residential. On commercial leases you can are allowed to lock the tenant out. After they haven't paid in so much time you are allowed to sell the items for the pay you are owed. Residential is TOTALLY different. If it is residential you could for a rough 2-6 months depending on your states laws.

Call the loser who isn't paying.

Leave a message saying that you will be having a "everything must go" garage sale in one month if you don't receive payment (or he doesn't move his crap).


Would people PLEASE stop giving legal advice when they are (a) not lawyers or (b) even if they're lawyers, they're probably not lawyers in the OP's jurisdiction because there are 50 states + DC in this country and we don't know which one the OP is in?

Whether the processes you folks (quoted above) are describing would work in the OP's jurisdiction is totally unknown. It might not be possible (i.e. it might not actually extinguish the tenant's right to the property). It might be flat-out illegal, such that the renter could actually sue the OP. In most jurisdictions, "self help methods" (changing the locks when tenant stops paying, etc.) are not legal; you have to use the normal eviction process instead. In some places they're illegal for residential landlords but legal in certain circumstances for commercial landlords. In some places... I could go on and on.

Long story short, the only thing any of us can say here with any degree of accuracy is "you need to find out what the laws in your jurisdiction are--your best bet is to call a local landlord/tenant lawyer who represents landlords," and "you can't actually do anything until you're the owner, so it might be a good idea to try and persuade the seller or bank to get things rolling." We can also discuss our own anecdotes ("here's what I did when that happened to me"), but with the caveat that what we did may not be possible or legal where the OP is.
« Last Edit: July 31, 2014, 05:58:52 PM by Daleth »

GrayGhost

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Long story short, the only thing any of us can say here with any degree of accuracy is "you need to find out what the laws in your jurisdiction are--your best bet is to call a local landlord/tenant lawyer who represents landlords," and "you can't actually do anything until you're the owner, so it might be a good idea to try and persuade the seller or bank to get things rolling." We can also discuss our own anecdotes ("here's what I did when that happened to me"), but with the caveat that what we did may not be possible or legal where the OP is.

I'd like to second this.

In my state, if you try to lock out a tenant or get rid of his/her positions without going through the legal process, you can and will be charged as a disorderly person, and the cops will show up and insist that you give the tenant access to his/her unit back.

I think it's a bit different if the property is considered commercial.

With that said, what we're dealing with here might be a quasi legal agreement made with a handshake instead of a contract. So you should really be quite careful before taking drastic activity.

Here's what I'd do. Contact the local PD first (non emergency number, or walk in) and explain the situation to them. If that doesn't lead to an obvious solution, contact a lawyer. The whole while, you should be asking about this on Biggerpockets with the state where you live included in your post, and you should certainly try to get into contact with the car owner at the same time.

Again, I strongly recommend that you do not expel the car or change locks unless you know what you're doing. If you're in the wrong state, you could get into deep, deep trouble for that.

SpicyMcHaggus

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IANAL.  (I am not a lawyer.)

I'm not representing myself as one, and anyone who takes internet advice and applies it directly without using critical thinking skills deserves what they get.

for the record, "this is what happened in Wisconsin when I worked for an auto shop that would tow abandoned vehicles." 


libertarian4321

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You get a mechanics lein on the vehicle.

1) send a certified letter to the owner at last known address, giving 30 days notice.
2) have police come and ticket vehicle for parking on private property.
3) set up a deal with a local tow company to remove the vehicle for you to their lot. It incurs storage fees and towing cost. If the owner does not show up to claim and pay for it, they can put a lein on it and it can be declared abandoned. The title passes to them. 

If you are smart about this, and the car is worth any money, you will either buy it back from the tow company to sell for profit, or have the tow company agree to pay you a portion of its value should they gain legal ownership of it.   


If this all sounds like too much trouble for you, push it out into the street and it will get towed by the city eventually.

Before you close on the property check with a lawyer to see what that is considered residential or commercial. There are very different rules for commercial than residential. On commercial leases you can are allowed to lock the tenant out. After they haven't paid in so much time you are allowed to sell the items for the pay you are owed. Residential is TOTALLY different. If it is residential you could for a rough 2-6 months depending on your states laws.

Call the loser who isn't paying.

Leave a message saying that you will be having a "everything must go" garage sale in one month if you don't receive payment (or he doesn't move his crap).


Would people PLEASE stop giving legal advice when they are (a) not lawyers or (b) even if they're lawyers, they're probably not lawyers in the OP's jurisdiction because there are 50 states + DC in this country and we don't know which one the OP is in?

Whether the processes you folks (quoted above) are describing would work in the OP's jurisdiction is totally unknown. It might not be possible (i.e. it might not actually extinguish the tenant's right to the property). It might be flat-out illegal, such that the renter could actually sue the OP. In most jurisdictions, "self help methods" (changing the locks when tenant stops paying, etc.) are not legal; you have to use the normal eviction process instead. In some places they're illegal for residential landlords but legal in certain circumstances for commercial landlords. In some places... I could go on and on.

Long story short, the only thing any of us can say here with any degree of accuracy is "you need to find out what the laws in your jurisdiction are--your best bet is to call a local landlord/tenant lawyer who represents landlords," and "you can't actually do anything until you're the owner, so it might be a good idea to try and persuade the seller or bank to get things rolling." We can also discuss our own anecdotes ("here's what I did when that happened to me"), but with the caveat that what we did may not be possible or legal where the OP is.

You are right.  I'm not a lawyer.  Nor did I represent myself as a lawyer.  I wasn't giving legal advice, I was giving real world life advice, which can often be wildly divergent from proper legal advice.

Sometimes, you can get things done a lot more quickly, cheaply, and effectively without both sides hiring an army of lawyers and spending months in litigation (where, in the end, only the lawyers win).

In retrospect, my initial idea wasn't the best.  I should have suggested giving the deadbeat a friendly reminder that you, as the new owner, can't guarantee the safety of his possessions (who can afford to pay for security when the guy ain't paying his bills?).  It's a dangerous world out there, and thieves take things all the time.  Bad things happen to good people (and people who don't pay their bills) and their "stuff."  It's tragic, really.

But you're right.  I'm NOT a lawyer, so to be safe, don't take my advice.  To be safe, and perfectly legal, hire the lawyers and spend months in litigation.  That's the proper thing to do. 

Also, don't jaywalk or spit on the sidewalk, they're likely illegal acts in your community, and you don't want to break the law.  And, of course, always drive within the posted speed limit.  You don't want to run afoul of the law.

Anyway, I wish the OP the best of luck in court, following proper legal channels, in dealing with that deadbeat.


Daleth

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You are right.  I'm not a lawyer.  Nor did I represent myself as a lawyer.  I wasn't giving legal advice, I was giving real world life advice, which can often be wildly divergent from proper legal advice.

Sometimes, you can get things done a lot more quickly, cheaply, and effectively without both sides hiring an army of lawyers and spending months in litigation (where, in the end, only the lawyers win).

In retrospect, my initial idea wasn't the best.  I should have suggested giving the deadbeat a friendly reminder that you, as the new owner, can't guarantee the safety of his possessions (who can afford to pay for security when the guy ain't paying his bills?).  It's a dangerous world out there, and thieves take things all the time.  Bad things happen to good people (and people who don't pay their bills) and their "stuff."  It's tragic, really.

But you're right.  I'm NOT a lawyer, so to be safe, don't take my advice.  To be safe, and perfectly legal, hire the lawyers and spend months in litigation.  That's the proper thing to do. 

Also, don't jaywalk or spit on the sidewalk, they're likely illegal acts in your community, and you don't want to break the law.  And, of course, always drive within the posted speed limit.  You don't want to run afoul of the law.

Anyway, I wish the OP the best of luck in court, following proper legal channels, in dealing with that deadbeat.

Eviction does not require "months in litigation." Usually it requires you to post an eviction notice on the property and then, a couple of weeks later, to have maybe a ten-minute hearing in front of a local magistrate judge, who's probably in or close to your neighborhood, and which you'll probably win easily in cases like this (where the tenant has stopped paying).

What CAN saddle you with "months of litigation" is locking tenants out, selling or getting rid of their property, etc., if the law in your area requires you to use the normal eviction process, which it almost certainly does. Lockouts, ditching tenants' property, etc. are called "self help methods" (I tell you that so you can google it) and can get you sued by the tenant.

Hence my suggestion that people with problems like this ignore the advice of people who suggest self-help methods, as you did, in favor of either using google (the local court system may have eviction paperwork and procedures posted online) or calling a landlord/tenant lawyer who represents landlords.