This is a first for me and I would need some Ideas how to safely handle this situation.

History on the place:

2 partners bought the place but only one took out the mortgage in his name and the deed is only in his name. Second partner never paid on the mortgage as promised (Can you say…..?!?!?!) and apparently nothing was put in writing. Second partner can not be found and he even vacated his own house.

First partner who is the owner of record is listing the property and is in the assumption that the property is vacant. That is how he has left it the last time he was there.

Yesterday after the listing contract was signed we are going over to the property to put on the lock box and discover that the house was occupied.


Here is what I know to do and maybe any IN Agent who is working in rental has some more Ideas for me:

1. Try to contact the tenant first to get a peaceful solution.
2. Send the tenant a certified letter to contact you
3. Send the tenant another certified letter informing him/her that there are being evinced due to them living in the house without the owners permission
4. File with the court for eviction due to tenant living without homeowners permission in the house

I’ll let other agents with more experience answer. But from what you’ve posted, the tenants most likely have no idea that whoever they’re paying rent to is not the owner.

So, I think options #3 & #4 are a little harsh and premature. And I don’t know that #2 would accomplish anything. Even with a certified letter, why should they contact you?

I think my approach would be to have the owner contact an attorney to send a “nice” letter informing them of the situation and advising them not send any more rent payments to the other person. Then I would do #1 and try to work out a peaceful solution. The owner could even give them a free month’s rent for their cooperation.

The reason I would have the owner go to an attorney first is to establish the reality and severity of the situation. Not to mention, these people may be the only ones who know how to get hold of the ex-partner, in case the owner wants to take any actions there.

Just my initial thoughts.

I just re-read your post. I was thinking these were people that the ex-partner put in the house. If they’re truly squatters, then every legal action that’s allowed needs to be taken. I don’t know what the laws are there, but you would need to find out first.

Well here is what we are going to do...the owner will go by the property today and leave a note attached to the door for the tenant to call him immediately. Then he will contact one of my Real Estate Attorneys I am working with; for further help.

Do it the easy way. The ownerneeds to have the Sheriff's department send out a Deputy. This is not an eviction as these people had no legal right to be in the property in the first place. Do not let this become an eviction as it could become expensive. This is trespassing so treat it that way!

Paul Oaks,
This now throws a question up.

I thought that when it appears that the "tenant" has obviously moved in and all the utilities are in their name, it no longer is trespass it is tenancy.

If that were the case you could move into any vacant property and set up house till they manage to throw you out.

These people that moved in did so without the owners permission. They paid no initial rent based on your original post. How did they obtain keys to the property? Did they just break in and have the locks rekeyed? To be a tenant they would have had to have had some legal right to be in the property at the beginning.

Also there was no legal partnership between the owner and the other person as there was no partnership agreement and note and mortgage are solely in your clients name.

So do you think the second owner who is not on
the mortgage or deed took payments from a tenant and took the money and ran?

This is why a tenant should always have the payment made out to the mortgage company and not the landlord because people do stuff like this.I had one in pre-foreclosure and the tenants were paying on time but the owner was not paying the mortgage company,the tenants were furious.

For most states a squatter has to notify the current owner and take open and adverse possession for many,many years before a court will award them the property,most likely not going to happen.

You get more with honey than you do with vinegar.If they are true squatters they need to be thrown out.If they are tenants maybe they will voluntarily leave if moving expenses are paid.

Well here is what I know so far:

The tenant signed the lease with the owners “Partner” but then he never collected from the tenant for the three month he was in the house and he was wondering when someone would come to collect the rent.

We are currently very lucky that the tenant is cooperating and he will vacate the premises by this Friday and by the looks of things the property is in very good condition.

It is now a pre-foreclosure and the owner has lost his job...short sale is in order...

Bettina,
Does the rent that the tenant agreed to pay cover the mortgage? If so the owner may be able to keep the house as an investment property and get it out of fore-closure considering that the tenant owes him 3 months rent. The lender may agree if the owner has the tenant send the rent to an escrow account at the bank. I know that will do yu no good but it may save the owner.

Paul, would love to be able to pull this one back out foreclosure, but the owner of record has NO job and without proof of current income the bank WILL NOT do a loan MOD even when the property is rented

Why would he need a loan MOD if the tenant rent covers PITI? How far is he behind? The tenant owes him 3 months back rent plus a security deposit or last months rent. If the loan is paid current the foreclosure stops and no MOD is needed. BTW I know several people that have several rental properties and no job! I would be willing to bet that the bank would do the mod if the owner has the rent checks made out to the lender for deposit into a special account to handle the property.

He is more then 3 month behind....and I have worked with this bank for 4 years and unless the owner can proof income they will not work with them. He is renting and this was his only investment property.