Friday, July 8, 2011

Should I Give Them a Break? (And at What Cost?)

     I have an ethical dilemma, or maybe it's just a practical question, I don't know. The problem is, I have a check sitting on the corner of my desk. And I don't know what to do with it.

     Here's the issue.

     A long time ago, around 1985, I bought a one bedroom condo as an investment. I was thinking at the time that I could use it to pay for my young daughter's college tuition. I ended up not using it for her tuition, because she got some scholarship money and I had some other funds, and besides, the value of the condo didn't go up nearly as fast as the cost of college, and after I'd paid the capital gains taxes on it, there would be no way it was going to cover the bill, so I just hung onto it.

     I just kept renting it out, making a little profit that gradually increased over the years. These days it costs me around $750/month to carry the condo, including everything. A couple of years ago, during the boom, I had it rented at $1250/mo., giving me a tidy $500/mo. profit. When that tenant left during the downturn, I dropped the rent to $1150 to make sure it got rented. Now, in April 2011, I rented it to a new young couple, pushing the rent back up a bit to $1200.

     The couple were moving back north from Florida, where they'd been living for only about 9 months. When they first arrived to look at the condo, they rolled up in an old beat-up Toyota stuffed with a lot of junk in the back seat. Looked kind of sketchy. But the two of them seemed very nice, and they liked the condo, and didn't hesitate over the amount of the monthly rent. They gave me the deposit in cash -- literally, a fistfull of hundred  dollar bills.

     I did ask for references. The young man said he worked for himself -- some kind of computer consulting -- so they gave me her references, implying that she had a job. I called their current landlord, a big apartment building in Tampa, FL. They said they didn't give out information about any tenants. Period. I called the previous landlord, and he had only nice things to say about the couple. They paid their rent on time, didn't cause trouble, didn't wreck the place. I think he might have been related to the woman in some way -- I don't know, just an impression.

     I called her work reference, to find out that, no, she didn't actually work there. She used to work there a couple of years ago. She'd been an employee for two or three years, and the person vouched for her saying she'd been an honest hard-working member of their team.

     So I rented the condo to the young couple; we signed a lease and they moved in. They paid the next month's rent in full, on time. And the month after that, on time.

     Meanwhile, however, my tenants complained that some new neighbors upstairs were making a lot of noise, clomping around in the middle of the night, waking them up. I had had a problem with upstairs renters once before, a few years ago. The problem is that our building is kind of old, and cheaply built, and then the owners of the upstairs unit installed a wood floor -- to make their place look nicer, but it resulted in conducting more noise down to my unit below. But it hadn't been a problem recently because the next upstairs renters, who'd lived there three or four years, were nice and quiet.

     I hadn't mentioned the upstairs noise problem to my new tenants -- because it hadn't been an issue for several years. I did tell them in general that they had to expect some noise, with people living all together in one building, and it wouldn't be the same as living out in the country, but I did not talk specifically about any previous problem with upstairs neighbors.

The living room, when it did have furniture
    And there wasn't a problem, not until the new people moved in upstairs. So my tenant talked to the building management, and I talked to the unit owner, and everyone agreed the renters upstairs would try to be more quiet, and they'd make sure to get some rugs on the floor. The result -- it's a little bit better, but it's still pretty creaky when they walk around upstairs, enough to still disturb my tenants.

     Now July 1 rolls around. My tenant calls me and says the wife's unemployment check is delayed because of the holiday. Would it be okay to either delay the rent check until July 7, when her unemployment check clears, or else to pay part on July 1, and the rest on July 7? They had $1000 that they could pay now.

     I had to cover my $750 monthly cost, so I said I'd take partial payment now. The guy said they were going to be away, but he said I could stop by and he'd actually leave two checks, one for $1000 which I could cash right away. The second check, for the balance of $200, he'd post-date to July 7.

     So I went over to the condo on July 1 and used my key to get in to pick up the two checks which would be on the dining room table. I go in -- and there's no furniture in the place! They had a tiny table in the dining area with two chairs, a small desk in the living room with a computer on it and another little table with a TV. No couch, no chairs, no bookcases, nothing on the walls. The place looked empty. And kind of sad. In the bedroom there was a only double mattress on the floor, plus a few clothes strewn around on the carpet. The closet was open and full of clothes.

     I found the two checks. I deposited the $1000 check and it cleared, no problem. Now I've paid my condo fees. And I have this $200 check sitting on the corner of my desk. Yesterday, my tenant called and left a message on my cellphone, saying the money was in the bank, I could now deposit the $200 check.

     But I'm wondering if I should.

     I'm wondering because I don't really need the money -- after all, I covered my condo fees and then some -- and this young couple seem like they're struggling, and I also feel a little guilty that they've had to put up with the noise from upstairs that they hadn't bargained for.

     Or ... are they "playing" me? And if I don't deposit this $200 check, will they take it to mean that I'm lowering the rent for the rest of their year-long lease? Yikes! That would raise my "nice gesture" from $200 to more like $2000. And then, what if they want to renew the lease?

     So, if I cash the $200 check, am I being a nasty old skinflinty landlord? If I toss the check away, am I caving unnecessarily, and being played for a sucker? It's hard to figure.

14 comments:

Mac n' Janet said...

Sometimes we can only do what we feel is right. If you feel you should give them a break, do it. You can't be responsible for the behavior of others, if they are playing you, you can only be responsible for yourself.
If it were me I wouldn't cash the check but let them know it was a one time Fourth of July thing. Don't know if that helps.

MerCyn said...

Your story is why so many people use an intermediary rental agent to handle everything. It seems to me the couple has not been totally honest with you. Cash the check. You can always be nice later.

gabbygeezer said...

Sounds as though you've been doing straight-forward, honest business. Keep it that way. Cash the check. If the couple needs some sort of relief regarding their payments, they should ask you directly for help, and so far they haven't done so.

Terry said...

I don't know what to say, the skeptic in me says to cash it, the social worker in me says they are likely in need of help. I am no good at these situations honestly, I hope someone else comes along with better advise.

Morrison said...

Cash the check. Business is business. If you hadn't walked into their condo, would you be hesitating over cashing the check? If you want to help the couple, tell them you have some furniture you don't need anymore. Would they like it? If they say yes, find some furniture to give them.

JBO said...

My daughter would be worried that the check had not cleared.
They worked a very tight budget for about three years while her hubby was enlisted.
I think a nice thing to do would be to cash the check and then anonymously put a gift card to a local food store in their mail box. They would never guess it. It would probably help out tons!
Someone did that for my dd and her dh several years ago when they were scraping by. They never forgot it -- and now do the same to people they see in the same situation....working hard and TRYING to survive.

Linda Myers said...

Cash the check. The couple has good intentions. If they need help, they can ask.

Retired English Teacher said...

I agree with those who said cash the check. I like the idea of giving them a gift card to a grocery store, or to Target. Keep the relationship professional. They can notify you if they really need help.

Anonymous said...

Their rent is an agreed upon price, and they have come up with it, so I agree with those who say cash the check.
I also struggle with the idea of an anonymous gift card. What is the chance they won't know it's you since you just let yourself into their place for the first time and observed their circumstances? I would be careful of getting involved in their lives uninvited.
Now, if they continue to complain about the upstairs noise, you might want to negotiate a bit lower rent, but don't give them money without some discussion. Just my two cents...

June said...

You sound like a nice person, but your tenants signed a legal agreement saying they would pay you $1200 dollars per month. If you could be sure this would be a one-shot deal, I'd say "sure, let it slide," but these people seem to be a little . . . erm . . . less than completely honest and aboveboard. I could almost guarantee that if you let this go, you'll be getting your monthly payments later and shorter as time goes on.

June said...

Where did they go away to if they can't pay their rent? If I didn't have money to pay my living expenses, I think I would not be taking trips.

Donna said...

Cash the check. If you start helping them now,how much more help will they need when the unemployment runs out. It could be that they don't have much furniture because they don't plan to stay. Keep it a business relationship. If they ask for help,do what you think is right.

Schmidleysscribblins.wordpress.com said...

I understand your dilemma. When David and I married and moved to our new house, I hang onto my condo and rented it.

We went through all the grief with tenants more than once. Tenants use anything they can to make you feel sorry for them. My philosophy is "If you baby them you bury them," and this applies to kids too. Twice we rented the condo to two of our children at different times. One was responsible, the other not. We finally had to ask the irresponsible child and his oinker of a wife to move out, which they did.

What a mess they left behind. We spent two days cleaning the place and then hired a cleaning company to do the rest. Repairs, maintenance and repainting were required, and we paid for it. We never rented to another kid after that.

One tenant tenent must have thought we were her parents. She was always asking us to attend a service at her church and hear her sing, and always late with the rent.

This is a long story so I will leave the other experiences out. We finally sold the place just before the big crash in real estate, although prices have rebounded around here. I will never be a landlady again. Cash the check, it is yours. Dianne

Sightings said...

I cashed the check.

And thanks for all your advice. I agree my tenants have not been entirely honest with me -- in fact, I even wondered if having little or no furniture meant they were thinking of moving out on me and breaking the lease -- but I still feel a little bit as if I share in their predicament. So I'm just mentioning in passing that I've got some extra furniture (and I do, not much, but I at least could give them a bed frame), and I'll leave it up to them if they want to pick up on it. And I'm ready to deal with any further noise complaints -- I've talked to the management several times and there are a couple of things they can do to mitigate the problem (even tho' they don't want to b/c it'll cost them some money).

So we'll see, but at least I now feel that I've got a strategy. So thanks again!