Property Managers | Law Outside the Box

Charging Late Fees: 2 New Landlord Tenant Laws

On August 9, 2010, In Landlord Tenant Law, By Luke Enno

Charging late fees is customary in most leases. However, as of August 1, 2010, in Minnesota, you should know that there are 2 new laws relating to how and when you can charge late fees.

#1 – For leases starting after January 1, 2011, the landlord cannot charge more than 8% of the monthly rent amount as a late fee UNLESS there is a federal law to the contrary (i.e. HUD or RD housing). For example, if you charge a tenant $500/month for rent, you CANNOT charge that tenant more than $40 in late fees for a given month ($500 x 8% = $40).

#2 – If it is not written into the lease that you can charge late fees, you are prohibited from charging late fees. As a landlord, you need to state in the lease that you have the right to charge late fees if rent is late by a certain number of days and also how much that late fee is.

For more information about these new laws, please go to this link or contact my office.

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Screening Tenants: 5 New Landlord Tenant Laws in 2010

On August 6, 2010, In Landlord Tenant Law, By Luke Enno

Are you a landlord who handles screening potential tenants? If so, you should know that as of August 1, 2010, several new laws were enacted in Minnesota which will affect how you screen potential tenants.

#1 – Landlords MUST give potential renters a written set of criteria that the landlord is using to evaluate that potential renter prior to accepting that potential renter’s application fee.

#2 – Landlords MUST cash one application fee at a time. In other words, landlords are barred from collecting a fees from a bunch of different applicants at once and picking and choosing the applicant they prefer and not refunding the application fees to the other applicants who were turned down.

#3 – Landlords MUST refund a potential renter’s application fee if the landlord declines the application for a reason not stated in the landlord’s application criteria. It is important for the landlord to follow its own application criteria or risk violating the law.

#4 – Landlords MUST provide any and all reasons for rejecting a potential renter’s application within 14 days after rejection and identify the criteria the potential renter failed to meet.

#5 – Landlords MUST give a potential renter a written receipt for the application fee upon request by the potential renter.

In addition to any other remedies, a landlord who violates any of these laws is liable to the potential renter for the amount of the screening fee plus a civil penalty of up to $100, civil court filing costs, and reasonable attorney fees incurred to enforce this remedy.

For the potential renter that lies on the application, such potential renter is liable to the landlord for damages, plus a civil penalty of up to $500, civil court filing costs, and reasonable attorney fees.

For more information, refer to the statute or contact my office.

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Tagged with: landlord tenant law • landlords • leases • property managers • renters • tenants

6 New Landlord Tenant Laws You Should Know

On August 5, 2010, In Landlord Tenant Law, By Luke Enno

Whether you are a landlord or a renter, Minnesota enacted several laws starting August 1, 2010. Here is a sampling of important laws that are now in effect:

#1 – If you pay your rent in cash, your landlord MUST provide you a receipt. If the landlord fails to provide you with a receipt, the landlord is violating the law.

#2 – If you pay rent by money order, you can use its stub or a copy of the money order as proof of payment.

#3 – Starting August 1, 2011 for new leases and starting August 1, 2012 for renewed leases, if the landlord’s lease allows the landlord to get attorney fees for winning in court, then if you win over the landlord in court, you are allowed to get your attorney fees recovered. This is true even if the lease does not provide a way for you to recover attorney fees.

#4 – Landlords who do not divide utilities fairly among tenants MUST refund each tenant whichever is more: (1) $500 or (2) triple the damages.

#5 – If a landlord refuses to return your security deposit in bad faith, you can now receive up to $500 in addition to double the security deposit back.

#6 – Landlords must keep your abandoned property for 28 days. If the landlord throws out your property before 28 days are up, the landlord MUST pay you whichever is more: (1) $1000 or (2) triple the damages.

For more information about these new laws, please go to this link or contact my office.

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Tagged with: landlords • leases • property managers • renters • tenants

New Landlord-Tenant Laws You Need to Know

On August 4, 2010, In Landlord Tenant Law, By Luke Enno

In Minnesota, a series of new laws were recently enacted on August 1, 2010 and they WILL affect all Minnesotans who are either renters or else who rent (such as landlords and property managers). These new laws involve a number of very important financial and other considerations that could have a significant impact on both renters and landlords.

The Minnesota legislature focused on several areas of the law including:

1 – The rental screening process

2 – Rental homes in foreclosure

3 – Capping late fees

4 – Payment of utilities

5 – Penalties for bad faith failure to return a security deposit

Harsh fines and penalties are being applied to landlords for failure to follow these new laws.

Over the next few days, I will be highlighting key laws and how they may impact you. If you have a colleague or friend that rents, I would encourage you to have them read my blog posts. For more information on these new laws and what they say, please go directly to this link.

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Tagged with: landlord tenant law • leases • property managers • renters • tenants

Landlord-Tenant Issues: What’s Your Exit Strategy Out of a Lease?

On March 12, 2010, In Landlord Tenant Law, By Luke Enno

What’s your exit strategy? Whether you’re a landlord or tenant, you should know! In this post, I’m going to concentrate on considerations relevant to the landlord/property manager.

Your Exit Strategy is your response to addressing tenant problems in violation of the lease. For example, let’s assume your renter has recently adopted a cat. Yet the lease states, “no pets”. Or let’s assume the renter is 10 days late paying the rent and this is the third month in a row where the renter has been late. As a landlord, you need to know what to do BEFORE a violation arises. In other words, it is advisable that you anticipate HOW you will resolve a violation. Preplanning is your surest way to controlling a problem.

I’m often asked by landlords what they should do to address a persistent tenant problem. I’m convinced that a well-crafted written policy on how to address a tenant problem significantly helps keep a small problem from escalating into a big problem. In this respect, I encourage the landlord to have access to landlord-tenant law resources (including MHA (Minnesota Multi Housing Association)) and a knowledgeable landlord-tenant law attorney). Resources like this enable the landlord to understand how to resolve a particular type of tenant issue before it arises. Often, the solution is easier than first-imagined.

Let’s say you discover that your tenant has a pet which is in violation of the lease. In this instance, you would be wise to call the tenant and remind him that he is in violation of the lease. Give him a set deadline to have the animal removed. Follow-up your telephone call with a letter (and email) confirming the conversation including how it is going to be resolved.

In the alternative, think outside the box! I had a no-pets clause in a lease but waived it in exchange for an additional fee after assessing the situation with the renter. I made sure that this waiver was incorporated into an amendment to the lease and that it was signed off by both the landlord and tenant. As a rule: a written lease can be amended to fit the circumstances. Just make sure to have that lease amendment in writing and signed by both parties!

Anticipation is an effective risk management tool that can save you money, time and energy!

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Tagged with: landlords • minnesota multi housing association • property managers • renter • tenant problems

Renter’s Insurance: Good for you. Good for your tenant.

On February 15, 2010, In Landlord Tenant Law, By Luke Enno

If you are a property manager, make sure the lease states that before the renter can move in, he must obtain (and maintain) renter’s insurance. The relative cost of renter’s insurance is minimal ($10-20/month). But renter’s insurance can be a lifesaver both for you and your renter.

Before your renter signs the lease or moves in, you need to have your renter provide proof of renter’s insurance. In addition, you should provide in the lease that if your renter fails to maintain renter’s insurance at any time, such failure is grounds for automatic termination of the lease.

Renter’s Insurance Protects the Renter’s Stuff

Your renter’s stuff is unlikely to be covered under your homeowner’s insurance policy. As such, in the event of a catastrophic loss like a fire, your renter could lose any opportunity to recover. In addition, renter’s insurance offers you as the landlord, an additional layer of legal protection in the event of a loss. A renter is less likely to sue you if renter’s insurance is in place.

Most responsible tenants understand the necessity of renter’s insurance and won’t have any issue with obtaining renter’s insurance. I recommend that if you need additional guidance understanding what renter’s insurance does to contact Dave Strebel with Anchor Insurance Agency.

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Tagged with: landlords • lease • property managers • renter • tenant

The costly price of eviction in Minnesota

On February 12, 2010, In Landlord Tenant Law, By Luke Enno

If you are thinking about evicting a tenant, take note: Minnesota has just about the highest court filing fees in the U.S. The average court filing fee to start an eviction is $320. To be sure, court filing fees can be recovered by the landlord if he prevails over the tenant in court. But by no means is this a guarantee the landlord will actually recover. I would say that in most cases the landlord does not end up recovering his court filing fee or unpaid rent.

Doing an eviction should not be used as a means to recover unpaid rent or court filing fees. An eviction’s purpose is to recover possession of the apartment unit.

Why do I say this? Because when there are tenant problems, threatening to haul a tenant to court needs to be calculated with precision. Never rush to file an eviction before understanding your options!

Let’s assume your renter is several days behind on paying her rent. As the landlord, you must be in communication with your renter both verbally and in writing/email immediately. Generally speaking, you don’t want to rush to file an eviction just yet; that is, unless late payment has been an ongoing issue month after month and it’s time just to be done with this renter.

If this is a first time offense however, you need to be clear in your communication with the renter regarding if/when you will move forward with an eviction. Be certain that the renter understands that the she is in violation of the lease and that a complete resolution needs to be made by a specific date. Easily understood communication with your renter will actually reduce the need to file an eviction and save you money. As the landlord, you are not required by law to bend over backwards. Remember, be reasonable but decisive.

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Tagged with: eviction • lease • property managers • renter • tenant

Landlord-Tenant Law: The Rules for Shacking Up

On February 9, 2010, In Landlord Tenant Law, By Luke Enno

Let’s assume you are renting an apartment space and your girlfriend decides to move in with you. BEFORE letting your girlfriend move in, check your lease to determine if her moving in is a violation of your lease and grounds for automatic eviction. In many cases, the lease is clear about whether you can have a roommate or not. But if you have the ability to sublease, I strongly recommend preparing a written sublease with your girlfriend no matter how good your relationship is.

A tenant is financially and legally responsible for the guests he invites into the apartment

As the named tenant on the lease, you remain just as responsible for other individuals either using your unit or renting from you. You may have a high level of trust in your girlfriend. But even if you aren’t going to charge her rent, you will want to protect your personal financial and legal interests in the event she or someone she invites into the rental unit causes excessive damage or other issues that violate your lease. Almost certainly, a landlord will hold you personally responsible and without a written lease with your girlfriend, you may not have much recourse.

You probably don’t have much recourse against your ex without a written lease in place

I’ve listened to a number of clients explain to me situations where a live-in has since moved out but while that person was living there, he did things to the apartment that caused excessive damage. In addition, in some cases, the live-in was responsible for some percentage of the rent but ditched the scene without making full payment. In these instances, I tell clients that it is much more difficult to take legal recourse against your ex if there wasn’t some type of written agreement in place.

Understand what you can and cannot do in your lease before subleasing

If you are thinking about allowing your boyfriend or girlfriend move in with you, I strongly recommend you review your lease first and then if it is acceptable to have him/her move in, prepare a written sublease for both of you to sign. It may save you a lot of trouble down the road!

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Tagged with: eviction • landlords • lease • property managers • renter • sublease • tenant

The High Price of Mishandling Your Renter’s Security Deposit

On February 7, 2010, In Landlord Tenant Law, By Luke Enno

If you’ve been a property manager, you may have faced a situation where your tenant fails to pay his last month’s rent but tells you just to keep the security deposit in exchange.

Understand the consequences of accepting the tenant’s offer

Before you jump to accept such an offer, think carefully about the potential ramifications! You may want to arrange with your renter to perform a preliminary walk-through right away to ascertain whether there is presently any damage to the unit beyond normal wear and tear. This may give you a better idea of what considerations you need to take into account.

Don’t waive statutory and lease rights you have as a landlord

In a situation like this, any communication you have with your tenant needs to be very precise. Don’t communicate acceptance of such an arrangement under any circumstances until the time is right! You may be O.K. with your tenant’s offer. But you don’t want to unknowingly waive certain landlord rights you have under the law.

Timing is critical when addressing tenant issues

Generally, your best bet is to wait out the balance of the lease until the tenant moves out. During that time, make it clear that you cannot accept any such offer until this happens. Then at the time the tenant moves out, perform the walk through with him and note in writing any damage beyond normal wear and tear, if any. If none, provide written notice within 21 days notifying your tenant that you are retaining the security deposit in exchange for the last month’s rent.

Remember: If you do not provide this written notice within 21 days, you could be forced to return the security deposit regardless of the fact it is designated for the last month’s rent. I’ve represented a landlord where the former tenant changed his story and the landlord was found to be in fault for not providing this notice and he was forced by the Court to return the security deposit. The landlord was out the last month’s rent without any opportunity to recover – a $1,400 mistake!

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Tagged with: landlords • leases • property managers • renter • tenant

How to Handle a Former Renter’s Abandoned Property

On February 3, 2010, In Landlord Tenant Law, By Luke Enno

In my time representing landlords, one of the most common issues relate to what the landlord should do after a tenant has moved out but left behind a bunch of their stuff. Usually, it is difficult to tell whether the tenant deliberately left these items behind or whether it was unintentional. Some of the abandoned items may have market value.

If you are a landlord faced with this dilemma (in a non-eviction setting), I recommend that you adhere to the following laws:

1 – Notify the former tenant by telephone followed up by a written letter (mailed certified) letting her know that she left behind certain items and you wish to arrange a date/time to have her retrieve the items. If the tenant declines to want the items anymore, have that tenant provide you with a signed writing to confirm that understanding.

2 – As the landlord, you are required by law to store the tenant’s stuff for 60 days after she has moved out. Storage of the tenant’s stuff must either be on the rental property or in an offsite storage unit. Most likely, you will want to store the tenant’s stuff offsite in a storage unit if you have a new tenant that has already moved in.

3 – Bear in mind that a tenant can recover his stuff at any time within a 60 day window after his move out. He simply must give a 24-hour written notice to you if his stuff is stored onsite and a 48-hour written notice to you if his stuff is stored offsite. Note: if a tenant still owes you money, you CANNOT by law withhold returning the tenant’s stuff as a means to force him to pay you.

4 – After the 60-day period expires, you have the right to keep or dispose of the tenant’s stuff after giving the tenant a 14-day notice (which should be in writing) to that effect.

5 – As the landlord, you have the right to recover your cost of storage for holding the tenant’s stuff. However, you CANNOT by law withhold returning the tenant’s stuff as a means to force him to pay you for your cost of storage. You will have to separately invoice the tenant to try and recover such costs.

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Tagged with: eviction • landlords • leases • property managers • renter • tenant

Law Outside the Box

Small business and estate planning legal information for the rest of us

Charging Late Fees: 2 New Landlord Tenant Laws

Screening Tenants: 5 New Landlord Tenant Laws in 2010

6 New Landlord Tenant Laws You Should Know

New Landlord-Tenant Laws You Need to Know

Landlord-Tenant Issues: What’s Your Exit Strategy Out of a Lease?

Renter’s Insurance: Good for you. Good for your tenant.

Renter’s Insurance Protects the Renter’s Stuff

The costly price of eviction in Minnesota

Doing an eviction should not be used as a means to recover unpaid rent or court filing fees. An eviction’s purpose is to recover possession of the apartment unit.

Landlord-Tenant Law: The Rules for Shacking Up

A tenant is financially and legally responsible for the guests he invites into the apartment

You probably don’t have much recourse against your ex without a written lease in place

Understand what you can and cannot do in your lease before subleasing

The High Price of Mishandling Your Renter’s Security Deposit

How to Handle a Former Renter’s Abandoned Property

Legal Categories

About Luke Enno

Recent Comments

Small business and estate planning legal information for the rest of us

Renter’s Insurance Protects the Renter’s Stuff

Doing an eviction should not be used as a means to recover unpaid rent or court filing fees. An eviction’s purpose is to recover possession of the apartment unit.

A tenant is financially and legally responsible for the guests he invites into the apartment

You probably don’t have much recourse against your ex without a written lease in place

Understand what you can and cannot do in your lease before subleasing

Legal Categories

About Luke Enno

Tags

Recent Comments