There are many difficult circumstances to deal with as a landlord (which is why it’s important to have professional management of your property), but this is one of the most difficult. On the one hand, you have sense of empathy for the surviving family, but on the other hand, this property is a business for you, and you have to treat it like a business. So how should you go about handling it when a tenant passes away?
Hopefully it isn’t something that is sudden and you’re aware that it could be coming on the horizon. This is frequently the case with elderly tenants going through treatment and they let you know ahead of time what is going on and who you should talk to in their family if anything should happen to them. Unfortunately, even many people in this situation don’t let you know, because they aren’t eager to discuss their own mortality. And then there are the people who die unexpectedly. So you have to be prepared on how to handle it if you are notified of a sudden death after the fact. You won’t always have advance warning.
Usually the way you find out is when the rent doesn’t get paid. You make a phone call, send an email, and send a letter, and then you get a phone call from a relative who breaks the news to you. Obviously, it is important to be understanding and express your condolences. While this is a business, even businesses shouldn’t be heartless. But after expressing condolences, you do need to get down to business. Carefully ask the family how they intend to handle the deceased person’s lease. Many times they’ll have someone who wants to move in so that they can spend some time organizing their loved one’s possessions and tying up loose ends. When that’s the case, it’s as simple as writing an amendment that changes the name on the lease to the family member’s.
If they do not have anyone wanting to take over the lease, though, it becomes more complicated. They’re probably going to want time to put everything in order, but again, this is a business, so you can’t simply allow them to take their sweet time to move the tenant’s belongings out of the property. Carefully explain to them that you’d be happy to give them all the time they need (within reason) if they pay the rent. If they do not want to pay the rent, though, then give them a reasonable deadline for when to have the deceased’s belongings out of the property. I would recommend something between 7-14 days. This is a reasonable period of time so that you don’t seem heartless and unreasonable, but also expeditious enough so that you aren’t being significantly harmed financially by the delay.
Keep in mind that you’ll be entitled to keep the security deposit since the lease isn’t being served out for its full term, so that will help with the financial loss of the rent if the property is in good condition.
This is a sensitive situation, so you want to treat it as such. But you also need to be somewhat firm because this is a business and not a charity. Your financial interests still matter, so don’t allow yourself to be pressured into being too accommodating, but also don’t be cruel to people who are going through a difficult loss.
Finally, and unfortunately, there are times when the tenant’s survivors simply don’t care about your situation and are in no hurry to remove the deceased’s belongings. When they simply refuse to cooperate, you’ll have no choice but file an eviction. The eviction would be filed against the deceased tenant “and all others”or “et al.” This will ensure that the survivors who may be occupying the property are included in any judgment that gives you possession of the property. While no one wants to take a family dealing with a loss to court, sometimes they give you no choice.
If you’d like to hire a company that is used to dealing with these sorts of uncomfortable tenant situations so that you don’t have to, please give us a call!