We have been trying to get our home modified, in lieu of FC or shortsale. Current renters are month to month and were advised upfront what we were doing. Rent was agreed on and would be month to month while they were waiting for their home to be built. Two months into rent, there was a FC noticed placed the door. The renters stopped payment on the check and have not paid for the next month, now owing 2 months. We have assured them that the property is being processed for a modification and or short sale, even forwarding the postponement date from our contact at the bank to give the renters security of knowing they won't have to move in 30 days. The renters took the info that was sent to them assuring the postponement and called our lender. Now the modification is in jeapordy, and they are being advised not to pay rent to us. We have been making short payments for sometime, so we are not just blowing the rent money, however now the renters have over stepped, we believe to justify not paying. Now that the modification may not happen, we feel that they should be responsible for damages effecting our lost opportunity of modification and rent they do not want to pay. Please advise.

They are required to pay rent ( unless you are in California) so just evict them and get new renters.

And what did they do, unless you had lied to the bank or they lied to the bank, if they merely verified that it was being modified.

If you for example, lied to the bank about it being a rental, then you are at fault, not the renters

Immediately give them a written notice to pay or vacate the premises. The time in which they must pay or vacate depends on the state where the property is located and is anywhere from 3 to 7 days. If they don't pay within that time then immediately file a lawsuit for eviction. At the same time, sue them for the unpaid rent.

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Originally Posted by michelleperea

... to give the renters security of knowing they wont have to move in 30 days. The renters took the info that was sent to them assuring the postponement and called our lender. ...

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If the bank does foreclose, and they are still in possession as renters at the time of the foreclosure sale, they would have to be given a 90-day notice before they could be evicted. Now, however, you are, as LisaB4657 told you, in a position to evict them after just a few days' notice.

It's unclear what they may have told the lender which jeopardized the negotiations.

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The renters stopped payment on the check

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You can also sue them for any costs you might have incurred because they stopped the check. If you tell us where you are we can tell you how much notice you have to give. But you should hand them a pay or quit notice tomorrow. If they tell you the bank said not to pay, you respond by saying the bank doesn't own the property yet. Until it does, you are required to pay the owner. If you don't pay, we will go to court for an eviction order.

We had relatives that were going to live in the home so it would not be vacant until a decision was made on the mod or short sold, instead we agreed to rent to a friend month to month until their home was built. They needed something immediate and did not want a lease since they would only need a place for 4-5 months, so our family made other arrangements until they moved. The reason we believe the modification to be in jeopardy is because when we started the process (February) we stated family was living in the property and we were not receiving rent, of coarse things changed a few months later and now the senario is different. We are only upset because the renters knew all of this before moving in and now they don't want to pay and told the bank that they are paying, so we just feel that they were maybe planning to do this all along since they knew our situation so they could stay somewhere and save money until they moved into their new home. We would really like to keep the home for our inlaws, but are uncertain that will happen now.

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Originally Posted by ScottGem

You can also sue them for any costs you might have incurred because they stopped the check. If you tell us where you are we can tell you how much notice you have to give. But you should hand
them a pay or quit notice tomorrow. If
they tell you the bank said not to pay, you respond by saying the bank
doesn't own the property yet. Until it
does, you are required to pay the
owner. If you don't pay, we will go to
court for an eviction order.

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We plan on doing this tomorrow. We live in California, not sure if this matters. Thanks

Quote:

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Originally Posted by LisaB4657

Immediately give them a written notice to pay or vacate the premises. The time period in which they must pay or vacate depends on the state where the property is located and is
anywhere from 3 to 7 days. If they
don't pay within that time period then
immediately file a lawsuit for eviction.
At the same time, sue them for the
unpaid rent.

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We live in California, our plan is to serve notice. Thanks

Quote:

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Originally Posted by ScottGem

You can also sue them for any costs you might have incurred because they stopped the check. If you tell us where you are we can tell you how much notice you have to give. But you should hand
them a pay or quit notice tomorrow. If
they tell you the bank said not to pay,
you respond by saying the bank
doesn't own the property yet. Until it
does, you are required to pay the
owner. If you don't pay, we will go to
court for an eviction order.

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That's our plan now. Did you know that if someone stops payment on a check they can be sued for 3 times the amount, it's called treble damages.

Quote:

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Originally Posted by michelleperea

We plan on doing this tomorrow. We live in California, not sure if this matters. Thanks

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Yes, CA Gives you the right to a 3-day pay or quit. So if you serve them today (8/10) they have until 8/15 to pay in full or vacate. On 8/16 you go to court for an eviction order.

Quote:

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Originally Posted by michelleperea

That's our plan now. Did you know that if someone stops payment on a check they can be sued for 3 times the amount, it's called treble damages.

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No I wasn't aware of that. But I knew you could sue for damages. Not sure if you can make that part of your suit for past rent (assuming they don't pay up). The good part here is that if they are building a new house, they are working and have money, so it will not be hard for you to garnish wages or attach bank accounts when you win.

You did make a mistake, however, in not telling the bank that there was a change in plans and you rented the property. I would explain to then this was only a temporary arrangement with friends that came up after you started the modification process.

Good luck and keep us posted.

Yes the mod could be in danger, but the renters only told the truth, so they have no liability in that. You were required to inform them, when plans changed. Since the mod depends on your ability or non ability to pay. If you have rental income coming in, from the property, it can change the status of the property if you no longer live in home ( different type of loan, different interest rates for a rental home, than one you live in.

Also the rental income has to be considered as part of the mod or the short sale.

Sorry but be mad at yourself on this one, for not informing them up front about the change in plans.