What to do When Your Tenant Dies

grave-15623_1280-PDIf you have been a landlord for a while, or have managed many units, sooner or later you will be faced with the question of what to do when your tenant dies.

I recently had a tenant death, and it can throw a perfectly good rental unit into some flux.

My renter was a 51 year old female when she died.  She was a heavy smoker, and had two underage male children when she moved in.  They had been living in the unit for about five years; the rent was the same amount as when they moved in.  The tenant always paid on-time, and was victim of a foreclosure wen she first moved in.  As far as I know, she did not die in the unit, but there are no disclosure issues with natural deaths in Minnesota.

The tenants originally had an annual lease, but are now on a month-to-month lease.  If the tenants were in a longer term lease, I would let them leave, without penalty, if they wanted to.

The woman was divorced, and her ex-husband was living there too.  He worked for the school district, and seemed like a decent person.

As the sons got older, one got his girlfriend pregnant, and I believe she and the child moved in.  I am at the property several times a month, but as long as I do not notice anything amiss, I let things ride.  I should have been watching for extra tenants, but did not.  The family seemed to be going along just fine, and no complaints or issues were notice.

About a year ago, I noticed that my rent was late; that is not ready n the first of the month.  I called the renter at work, and there was a message indicating that she was going to be out for a long time.  Luckily, she had a City job, so her wages were probably guaranteed as long as she was under some sort of medical issue. I did get a hold of her after a couple of days, and received the rent.

Over the next several months’ rent came in well;  I texted the renters son, who was still in high school on a regular basis about the rent when it was due.  He made sure that a check was put in my rent collection envelope, and I was always able to pick it up.  It appeared like it was made out by a different person than who signed it.  One time, the check was from a family member who had the same last name.

Since I knew my renter had been in the hospital and out of work for several months, I started to get worried about her.  I wanted her to get healthy, and I also wanted to start planning ahead of I needed to get a new renter.  I quizzed her son, but he said they are trying to determine what the matter with her was.  I could not tell if he did not know, or if he did not want to say.  Either way, it was none of my business.

I later found out that she had developed lung cancer, stage 4.  She had a lump on her neck, and went in the hospital to get it checked out.  By then, the cancer had spread and was too far along.  She went through four chemotherapy treatments, out of six that were recommended, and decided it was not worth continuing the treatments.  All of this I found out after the fact.

On June 9, 2014, I received news from the tenant’s ex-husband that the tenant had died.  He was very depressed, so I did not press him for a lot of information.  He did say that he wanted to stay in the property, and I assume with the kids.  It makes sense, he was already there.  I assured him that I was OK with him being there, as long as he was paying rent.  One son just graduated high school a few days earlier, so hopefully his mother was able to be proud of him.

Since the original tenant always paid by check, he was concerned that because he did not have a checking account, there would be a problem.  He said he did not have a problem with the money, but just did not have a checking account.  I take rent in all forms, but cash is a bit more difficult.  The tenant needs a receipt, and we both have to be at the same place, at the same time.  Money orders are another solid option when a tenant has cash.  Whenever someone does not have a checking account, I get a bit worried about their ability to pay rent.  After all, most financially responsible people have checking accounts for depositing paychecks.

The tenant was cremated, and a service was held on the Saturday after the death.  I was planning on going, to pay my respects and to answer any questions that they had about rents.  I thought I could also gleam a bit of information about where my rent was coming from, without directly asking about it.  Answers to questions like “Don’t you still work at the School District?” would be a great help to me.

In the end, I did not go to the service.  I figured that it would be the same as a bill collector coming to a funeral.  After all, a landlord is a bill collector.  Every month, I effectively send a bill, and collect the rent.

So, I will know more n about ten days, and may update this post.  The renters will either pay rent, or not.  The mortgage company will either forgive my mortgage payments, or not.  Whether the rent is paid or not will depend on the mortgage company’s answer.  Actually, the building is paid off, but it is the same idea.

Regardless of a death, or not, the rent needs to be paid.  I already have a couple of vacancies coming for June 30th, and two more for August 1st, so I do not need any more.  I have the June 30th vacancies filled.  A tenant that is not paying is worse than vacancy.  They will either be current on rent, in the process of moving out, or being evicted by 7/10.

I plan on texting/calling the tenant the week prior to the end of the month.  I will then know more about when I will collect the rent money.  I send my automated text to the tenant on the 28th of the month.  And of course I will follow up with what the tenant says on my first call with him.

Update 04/15/2015:  The remaining tenant has also died, at age 62 a little less than a year later.  The ex-husband.  It was liver and kidney failure and was a heavy drinker.

Have you ever had a tenant that died?  Or known a landlord that had a tenant die in their rental?

 

8 Replies to “What to do When Your Tenant Dies”

  1. That is certainly a situation you probably don’t think about. I’m curious, do you make tenants declare? all persons living in the rental. I’ve heard horror stories of squatters who would not leave after the death of the person who signed the lease. Have you ever had to deal with this?

    1. Yes. All tenants must be declared. In the case, I was a bit lenient as the ex-husband moved in shortly after she did. I met him, and he seemed OK. I did not check his credit score. He was not a criminal. It was a duplex, and the other side of the duplex was a business. In a more densely populated multi-family, you have to be careful about bringing in people that are criminals and might affect your current tenants.

      You have to deal with squatters like any other tenant that doesn’t pay rent. Just wait until rent is unpaid, then file an eviction as soon as possible. I have had tenants move in/out, and had to get rid of my immigrant roofers, but that is about it.

      Of course, when you evict, you evict the tenant and ‘all others’, so everyone must get out.

  2. I’m sorry this happened, but really appreciate this kind of candid post about a tricky subject. We’re getting into managing a few properties now, so it’s bound to happen eventually.

    1. Yes, it is a bad deal. Hopefully everything works out OK for my remaining tenants. There are lots of other situations that happen that you need to be prepared for. A tenant loses there job, maybe gets hurt and cannot continue their self employment and do not have any disability insurance, etc.

  3. I wonder if she had life insurance and hopefully her beneficiaries were up-to-date (her sons). Being divorced from her husband, even though it seems like they might have reconciled, I wonder if he would access to any money coming to her. I hope it goes okay and you get the rent every month on time.

  4. Wouldn’t you re leAse with the survivor? Do another application to make everything formal? Can you evict someone not listed on the lease? It sounds like you need some paperwork at this time.

    1. I would re-lease with the survivor, as he has been living with his ex-wife in he property for some time. The ex-wife is he one that died. You can evict for ‘all occupants’, even if you do not know there names. I do have these folks names.

      I attempted to contact the renters this past week. The father said he would ask his kids if they have money. I never received a phone call back. It sounds like an eviction is going to happen.

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