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No way on the lease-purchase. If it's not done *perfectly*, you could end up with a tenant-owner that has to be foreclosed on (and a judge may take back any down payment)- that's not a road for those without experience to travel.
If the tenant doesn't leave at the end of the lease, they're a "holdover" tenant - a good lease has a substantial rent increase for holdovers, but based on what you've described, you may not have a very good lease. If it were me, I'd cut the pm out of the deal & hire your own local real-estate/landlord attorney to evict when the term is up if they don't leave. Your current pm can't be trusted to handle the matter promptly. Get it done right, get the property listed & take your lumps at a sale, not from a crappy tenant or pm.
Even if they give you a down payment and agree to additional rent each month that goes to the purchase, they will likely fall behind.
Then, when they are told to leave, they will believe entitled to things in the house because they gave you down payment money. So there goes the appliances, the water heater, the HVAC system, the garage door opener. The light fixtures and cabinets will be sold on Craigslist. They may even pour concrete down the drains. That's what happens on foreclosures so much of the time, and that is what you will be Facing.
These folks already burned you once ... shame on them. Give them an opportunity to do it a second time ... shame on you.
My bet is if you decide to go ahead and sell and move these tenants out, you will have a difficult time getting them out and may have to resort to legal means ... after they again stop paying their rent.
This is not a matter of a misunderstanding and giving them a second chance to make the situation right. It's about their demonstrated lack of character and willingness to leave you holding the bag. If you think you have had a difficult situation getting them to pay rent and/or establishing some recourse before; try getting them on a lease-to-own contract where some liberal judge determines they actually have more ownership rights than specified in your contract!
Honestly .... What in the world are you thinking??? --- AND, on top of that, you are thinking about continuing with the same previously non-responsive property manager??? - You've heard about the definition of insanity?: - Doing the same thing and expecting different results!
Last night, I was half and half. After seeing comments here, now I think, it's no way I will do.
I just texted my answer to the tenant--No. We will sell it now through a regular process. Please vacate the property according to the schedule. A response came a few minutes later--Got it. Have a good day.
We will see what happens from now on. I just hope that they move out with no drama. If not.... I guess I will learn more life lesson, I guess, in the end. But just hope no need to learn more out of this whole thing.
We are now looking for an agent who would take up on this and sell.
As for the property manager, I think they just did the bare minimum to prevent me from going to the court against them. Just not enough damage caused by them that I can argue to the judge. So I'm moving on. But sure I can post reviews online here and there, to warn others. No one can stop me from doing that. Of course, I will do so when everything is cleared up. I still have to work with them. The tenant leaves, inspection is done to assess any damage to the property incurred and due amount of money is deducted from the security deposit. Then I will cut the tie with the manager.
Now, speaking of finding an agent who would help us sell it, what would be your advice on how to find a good one?
We have worked with real estate agents a bunch of times. We know who are good and who are not. But neither of my wife nor I are social people, so we don't have good sources of pool of people to get recommendations from.
So essentially we didn't have any "screening" process when choosing an agent. Just walk to a broker's office or just call their number and meet whoever was available and go from there. We had a range of experience this way---one time we were very lucky to have a good person that we really liked (still highly recommended to anyone I could talk to in that area), but more often we were less lucky and got average results or worse--some of which lead to the mess in this thread.
What is the best approach when we are not in some sort of "network of people?"
...As for the property manager, I think they just did the bare minimum to prevent me from going to the court against them. Just not enough damage caused by them that I can argue to the judge.
That's been my experience with PM as well. They make sure they've covered the correct tracks so they can't be sued.
As far as looking out for my best interest that usually come second to their own needs.
First thing monday morning - put that text with your tenant into a letter form and send it to the tenant using USPS return receipt requested. You want signed proof of delivery. Send another copy to your PM.
Re Finding a realtor. Try posting on the local CD board. Include the zip code of the property. People will have to PM you with recommendations. (I'd normally suggest asking the PM, but in this case I'd be afraid they would recommend somebody as lazy and incompetent as they are.)
First thing monday morning - put that text with your tenant into a letter form and send it to the tenant using USPS return receipt requested. You want signed proof of delivery. Send another copy to your PM.
Re Finding a realtor. Try posting on the local CD board. Include the zip code of the property. People will have to PM you with recommendations. (I'd normally suggest asking the PM, but in this case I'd be afraid they would recommend somebody as lazy and incompetent as they are.)
Forget the PM. Given what you've written he's not going to help. If anything he'll probably makes things worse.
I often have asked for recommendation on the local CD board and have gotten solid advice in the past.
CD provides solid advice, but I personally think the best way is to go to the area and check who has the largest number of for sale signs in the immediate neighborhood. Generally realtors specialize in certain neighborhoods and they are well known in the area for being the 'go-to' realtor to get a property fairly priced and sold quickly.
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