It’s Thursday again, time to make sure the trash is out before the garbage truck goes by. But more important to the readers of this blog, it is the day that the Dr. Rent Radio Show hits the airwaves on WNRB-LP, 93.3 FM, from 5 to 6 PM.
There are a couple of items that I wanted to talk about on last week’s show, but ran out of time. So, we will cover them this week. They include talking about tenant’s rights when the rental property is “untenantable” as well as discussing the new and improved Wausau Housing Task Force.
Added to those left over topics from last show, I had a few questions come up in the last week. Most know that the deposit needs to be returned to the tenant within 21 days. But, when do those 21 days actually start, especially if the tenant vacated before the end of the lease?
I have been talking with someone who is taking their first steps into being a landlord and will be renting out their first property. An application and a lease seemed like obvious things that they needed, however what other forms are good to have? Also, once they start getting applications, other than checking the applicant out on CCAP, what other underwriting should be done?
One other new question will piggy-back on the untenantability issue, what can a tenant do when they find out the utilities (that are included in the rent) are going to be turned off because the landlord didn’t pay them?
In case you missed last week’s show, it was a show devoted to questions. A question came up about someone who bought an old house that was a number of rentals. He converted the house back to a single-family home. He then bought the old and run-down apartment building next door. He was going to tear it down to give him a bigger yard. The City (this did not happen in central Wisconsin, though it was in Wisconsin) said no. Can a city say that a property cannot be torn down? There are times when that answer is yes. When they said they bought an old house and it was next to an old apartment building, I had to ask how old. Were they old enough to be on a federal, state or even local historic registry? The person asking me the question didn’t know, but did know that the properties were located within what is known as a locally established “Historic District.” DING DING DING…. That could be the answer. The City has a great deal of control over what can happen to old properties located within a historic district.
The next question had to do with a security deposit. The tenant left, but did not leave a forwarding address. The landlord, when returning the deposit, sent it to the last known address of the tenant (their apartment). There was no forwarding address on file with the post office either so the letter came back to the landlord. My advice has always been keep this letter, unopened, in the tenant file so if the tenant comes back years later, you can prove you met the 21 day guideline. Have them open the letter, and assuming the check is no longer good because how much time has passed, void that old check and cut a new one right there on the spot. The question came up about whether or not the landlord must (or should) send the money to the Wisconsin Dept. of Administration’s unclaimed property office instead of holding on to it. My personal opinion to must (and should), is NO. It is not technically unclaimed. It was properly mailed and returned. There is nothing in any statute or rule that I could find that mandates this money be held by the state (whereas money from the sale of property left behind DOES get forwarded to the state). Once the landlord returns the deposit in accordance with the laws, their obligations are done. No additional obligations are created if the letter comes back, at least none that I am aware of. Returning the money to the Unclaimed Property Department could create issues if the tenant comes back to you for the deposit check years later. You, the landlord, has the obligation to give them the deposit and could be liable for double damages if you don’t. Do you really want to trust that to the state?
Another question came up about when having multiple, unrelated tenants on a lease, should you put all tenants on the same lease, or do separate leases with each tenant. There are pro’s and con’s to doing it both ways. Often, in student housing situations, it is common to have each tenant have their own lease. That way, if a tenant finishes school earlier than the rest, the other tenants are not affected. This tenant can move out and the landlord can find a new tenant. If they were all on the same lease, it would be much more complicated. Also, when tenants move, you can send their deposit to them and not have to worry about how to split the deposit between the parties.
My preference, and how most non-student housing is done, is to have all of the parties on the same lease, making them all jointly and severally liable. One problem with individual leases is if there is common area damage, determining who to bill for that damage. If all parties are on the same lease, they are all responsible. The same is true for collecting rent. If there are separate leases, if one tenant doesn’t pay their rent, you have to try to collect that from that tenant. However, if they are all on the lease together and one person doesn’t pay their “share” of the rent, the landlord can hold all parties on the lease responsible.
If you are a tenant, you would much rather have a separate lease so that you are responsible for your own actions only and nothing a co-tenant does can affect you. However, if you are a landlord, you want all tenants to be on one lease because that way you don’t have to worry about who did want or didn’t pay what, everyone is on the hook.
A question came from a landlord who took one of my classes who had a 2-year lease with a tenant. From my class they learned that if you don’t have some type of exception written into the lease, you can’t use the 5-Day or 14-Day notices that most landlords (and tenants) are familiar with. Instead, there is a 30-Day notice when there is a breach of lease. The question is whether there is always a right to cure? Yes, there is. They wanted to know if they gave them a 30-Day notice with right to cure, and they cured; and then a few months later breached the agreement again, could the new 30-Day notice not have the right to cure? No. If the lease is longer than a year, there is no language in the lease indicating other notices can be used, then most standard breaches have to be given a 30-Day notice and MUST have a right to cure. This is why I recommend landlords avoid doing residential leases for longer than a year.
Finally, the last question came from a landlord that read in a magazine about giving a 3-Day notice for a tenant not paying their rent, and wanted to know what that was all about. I had to ask them where they read that article. I receive no less than 7 different magazines that have to do with renting properties, and most of them are national in their focus. However, landlord-tenant laws are state-specific. We can do some things here in Wisconsin that they can’t do in other states. Conversely, there are some things that people can do in other states that are not legal here in Wisconsin. Wisconsin does not allow for a 3-Day notice, the shortest a notice can be is 5-Days. So, if you read something about a 3-Day notice, just assume they are talking about what we call a 5-Day.
As you can see, if you miss one show, you miss a lot. Again, I will be on the air at 5 PM tonight on 93.3 FM in the Wausau area on WNRB-LP. Until then, HAPPY RENTING!