Category Archives: Money & Finances

Collecting Rent From Behind Bars

iStock_000024388823Small-300pxThis Thanksgiving, many tenants across the United States can be thankful for having a landlord who strives to maintain a safe living environment while being responsive to tenants’ legitimate needs as they arise.

But although there are many excellent landlords out there, some are real turkeys who excel at gobbling up rent while ruffling tenants’ feathers to a point that crosses the line. Rather than just being held civilly liable to tenants for a dispute or even being outed on a city’s website for excessive violations of its code, these landlords’ take action that’s so egregious it warrants criminal charges.

Fortunately, not many landlords manage their property in a manner that lands them in jail. But here are some ways it can happen:

Putting lives at risk to save money. There’s nothing wrong with trying to save money, but landlords who attempt to do so in a way that violates the law and puts tenants’ lives at risk are making a serious mistake.

When a fire consumed a New York City apartment building in 2010, fire fighters encountered unexpected trouble when trying to battle the blaze because the landlord had illegally added partitions to create additional apartments for more revenue, according to reporting by The New York Times. Earlier this month, prosecutors announced that the landlord, who was arraigned in 2012, pleaded guilty to criminally negligent homicide and will face a prison sentence of one to three years. In addition, the landlord is reportedly paying $1 million to the family of a girl who escaped the fire with serious injuries.

Taking eviction law into your own hands. Landlords who ignore landlord-tenant law and follow their own rules when it comes to evicting tenants not only risk liability with their tenants but could get arrested for their unlawful actions.

Early this month, a Lloyd, New York, landlord decided to wake up a tenant in the middle of the night and try to evict her by throwing away her belongings. The landlord was charged with second-degree burglary (a felony) and fourth-degree criminal mischief (a misdemeanor), according to the Poughkeepsie Journal.

In a similar recent case, the owner of a rental property in Norwood, North Carolina, allegedly broke the law by forcing tenants out of their apartments and removing their belongings. Local police arrested and charged the landlord for three felonies, including breaking and entering, larceny after breaking and entering, and larceny of a motor vehicle, according to a report from the Anson Record.

If you’re a tenant facing an eviction that you believe is unlawful, learn about your rights by checking out the Nolo article, “Can I sue my landlord for an illegal eviction?

Continuing to ignore the law even after you’re ordered to pay for violating it. Landlords who don’t follow laws that pertain to them usually risk getting sued or fined for their noncompliance. But landlords who ignore laws, get fined, and then ignore those fines may risk jail time.

Earlier this month, the Contra Costa Times reported that local authorities in Concord, California, were seeking to arrest a landlord for allegedly refusing to comply with the city code when it comes to eliminating bed bugs. For months, the landlord ignored violation notices and refused to pay fines totaling $800, according to the report. If convicted on the misdemeanor violation of the city code, the landlord could face six months in jail and an additional $1,000 fine.

Taking advantage of your position as a landlord. Although landlords own the buildings in which their tenants reside, their actions are limited by their lease and the law. For example, landlords can’t just drop in on tenants whenever they wish or secretly spy on them.

The owner of a New York City brownstone just learned that lesson the hard way when a grand jury indicted him on 10 felony counts of unlawful surveillance after a tenant discovered he was secretly filming her using hidden cameras in her apartment, according to a report earlier this month in the New York Post. The tenant is also bringing a civil suit against the landlord for liability.

If you’re interested in crime (reading about it, that is), be sure to check out another Nolo law blog, “Uncuffed: A Candid Take on Crime and Society,” in which Micah Schwartzbach discusses all things criminal law, from individual rights to fair punishment to current events.

New York City’s Frank Slumlord-Shaming Strategy

iStock_000025162012Small-300pxStart spreading the news: New York City is making it increasingly difficult for bad landlords to do business in the five boroughs while keeping their reputation intact.

The city that doesn’t sleep has been pressing forward with a strategy of publicly shaming landlords who have displayed a commitment to making tenants’ lives miserable or who treat the city code like an inconsequential compendium of suggested practices. New York hopes that landlords who discover that their reputation is on the line—as well as online—will be inspired to change their ways. Plus, other slumlords with little town blues may think twice before letting them melt away by deciding to be a part of it in old New York.

King of the Violation Hill, Top of the Slumlord Heap

While it’s normally admirable to be exceptional, New York City landlords don’t want to find that they’re A-number-1, top of the Landlord Watch List. Four years ago, the city’s then-Public Advocate and current mayor, Bill De Blasio, started the Watch List with an admonition: “The city’s worst landlords can no longer hide from responsibility while their buildings fall into dangerous disrepair.”

Last month, Public Advocate Letitia James showed her office is continuing its support, right through the very heart of the initiative, by unveiling a revamped website highlighting the “100 Worst Landlords in New York City.” The website lists landlords who own buildings with a high number of outstanding housing maintenance code violations. These landlords can get the city to remove their names once they resolve enough open violations (see the Office of the Public Advocate’s “Criteria & Submissions” page for more information). Already, there’s some evidence that the list is prompting responses.

New Law Will Protect Tenants Not Longing to Stray

Under new legislation enacted September 30, New York City will soon begin posting on the Internet the names of landlords who are found to have violated the city’s tenant anti-harassment law. On the books since 2008, this law bars landlords from using threats or other types of action (such as cutting off utilities) to force tenants out of their apartments. In addition to this public shaming, landlords who illegally require their tenants to wear vagabond shoes could face a maximum civil penalty of $10,000 per apartment, which is twice the current level.

City to Slumlords: It’s Up to You

Given New York City’s growing commitment to shaming bad landlords into cleaning up their act, it may be true that if landlords can make it there, they’ll make it anywhere. As for slumlords who choose not to change their ways, they may indeed need to make a brand new start of it—in another profession.

The Key to Avoiding Apartment Rental Scams

iStock_000016530240Small-300pxApartment rental scams are very frustrating. Unlike the case with many other crimes, victims of a rental scam aren’t forced to do something against their will and don’t even know that a crime is in progress. Instead, rental scam victims give their hard-earned money to thieves under false pretenses, and by the time they realize what has happened, the scammers are usually long gone.

A typical rental scam involves a person who poses as a landlord with apartments to rent, then takes money from unsuspecting apartment hunters who think they just gave a legitimate deposit for the perfect rental.

Just this week, for example, the Manhattan District Attorney announced the indictment of a pair who allegedly defrauded more than 20 victims, many of whom were new to New York City, out of some $60,000, with victims losing as much as $4,500. Last month, a Phoenix couple realized they were scammed after wiring $500 to a man who created a fake rental ad and used the name of the property’s owner, then disappeared, according to a report from azfamily.com.

Not so long ago, I had the opportunity to speak with a couple who fell victim to a rental scam. What became clear to me as I spoke with them is how unlikely it is that they will get caught up in a rental scam again. This is because awareness of rental scams is the key to avoiding them, and this couple’s unfortunate experience ensured they would be on their guard going forward.

Fortunately, you don’t need to experience a rental scam in order to proceed with this insight. If you go about your apartment search keeping in mind that there are people out there pretending to be landlords and trying to con people out of money, you’ll be able to approach questionable listings with caution and pass on opportunities that seem suspicious.

As you proceed, ask yourself questions such as:

  • Does this deal seem too good to be true?
  • Do I feel rushed or pressured to give money?
  • Are they taking shortcuts with me such as waiving tenant screening requirements?
  • Have I met the landlord or property manager?
  • Have I seen the actual apartment and not just photos?
  • Do I need to wire money?

If the answer to one or more of these questions is yes, it may be a red flag of an apartment rental scam.

Can Landlords Benefit from Renter’s Insurance?

iStock_000015565844Small-300pxAs you read in the last post (see “Renting Without Insurance: Why So Many Tenants Do It,” August 29, 2014), renter’s insurance offers significant benefits to tenants. Most notably, tenants need renter’s insurance to cover losses to their personal property, since their landlord’s insurance only covers the building’s structure. Plus, renter’s insurance includes a liability component that can offer you coverage in case, for example, someone breaks a hip after tripping over a step in your apartment.

It’s no surprise that, true to its name, renter’s insurance aims to help renters. But does a renter’s insurance policy also benefit landlords? In other words, is a landlord better off if the tenants in the building have renter’s insurance?

The answer is yes. Although renter’s insurance is only for renters and landlords already have their own insurance, landlords nevertheless stand to benefit when their tenants also buy insurance. If a tenant gets compensated after a loss thanks to insurance, it’s more likely that the tenant will continue staying in the apartment and remain in a position to afford the rent. Plus, if a guest is injured and you’re found partly liable, you’ll feel better knowing your tenant’s insurer is there to shoulder the tenant’s costs.

How to Get Your Tenants to Carry Renter’s Insurance

Tenants are already paying rent, a security deposit, and other apartment-related fees and expenses. So, how do you get tenants to open their wallets again and purchase a renter’s insurance policy? You have two choices:

  1. Require it. Some landlords choose to require tenants to have renter’s insurance, citing the benefits to both parties. Sometimes, a landlord’s insurer actually imposes this requirement. If you decide to require tenants to carry insurance, you can add an addendum to your lease going forward. You’ll need to wait, however, until lease renewal with current tenants. If your property participates in an affordable housing program, be sure to check if the program rules bar you from requiring any additional financial outlays from tenants, such as renter’s insurance premiums. If you decide to require renter’s insurance, enforce it by giving yourself the right to ask tenants for proof that their policy is still in effect each year.
  2. Suggest it. There’s nothing stopping you from simply recommending renter’s insurance to your tenants. Since the reason so many tenants don’t carry a policy is they’re not aware of the option or they don’t understand the need, giving your tenants a little education about renter’s insurance without pressure may actually inspire them to buy a policy. You can spread the word by giving tenants information on renter’s insurance at their lease signing, in an email to tenants, or as part of an issue of your property’s newsletter, if you publish one. Mention the benefits, point out the average cost ($15-$30 per month, according to the National Association of Insurance Commissioners), and provide a list of suggested insurer sites for tenants to go for more information about purchasing a policy, such as State FarmGEICOAllstate, and Progressive.

Renting Without Insurance: Why So Many Tenants Do It

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In the wake of Sunday’s magnitude 6.0 earthquake that rocked northern California, it came to light that only 12% of California’s residents have insurance that includes earthquake coverage, according to a press release from the Insurance Information Institute.

But here’s an even more surprising statistic: According to a recent survey by InsuranceQuotes.com, only 40% of apartment tenants across the United States have any insurance coverage at all.

Short of an earthquake, there are many ways your belongings can get damaged or lost, such as by fire or as the result of a theft. Having a good renter’s insurance policy in place covers your personal property loss in many situations, plus it gives you liability coverage for times when a guest trips and breaks a leg in your apartment.

What’s Your Reason?

If you’re an apartment renting without insurance, take a look at the common reasons why so many tenants don’t have a policy in place. If any of these reasons looks familiar to you, it may be worth revisiting the issue:

  1. You didn’t know it’s available. Some tenants get so caught up in the excitement, stress, or fatigue of the apartment search process that they don’t consider insurance. Others don’t think about renter’s insurance because they assume that insurance is only a homeowner’s concern. But renter’s insurance exists as an option to help compensate tenants for property damage and injuries. Even if you never need to file a claim, knowing you have a policy in place can bring you valuable peace of mind.
  2. You haven’t gotten around to it. Did you know you can compare renter’s insurance policies and buy one online? The process is probably easier and less time-consuming than you think. Just search the Web for “renter’s insurance” and then visit the sites of top insurers to determine coverage and pricing. As a tip, if you already have automobile insurance, a good place to start is to check your auto insurer’s website to see if it also offers renter’s insurance coverage. Maintaining two or more policies with the same insurer may qualify you for a multi-line discount.
  3. You think your landlord’s insurance is all that’s needed. Picture what your apartment looked like before you moved in. That’s what’s covered by your landlord’s insurance. All the stuff you love that you brought with you to the space, from the living room sofa to the flat-screen TV, would be covered only by a renter’s insurance policy. Plus, don’t forget that renter’s insurance also has a liability coverage component, which can save you thousands of dollars in the event someone gets hurt.
  4. You don’t want to spend the money. You may be pleasantly surprised to discover that renter’s insurance costs less than you thought. Like other types of insurance, the premiums depend on the level of coverage you select and your deductible, but the average policy costs only between $15 and $30 per month, according to the National Association of Insurance Commissioners.
  5. You believe the chances of something happening are so slim. Hopefully, you’ll have nothing short of an enjoyable apartment living experience. But keep in mind that a crime or other loss can occur at any type of rental property. Even if you live in a gated community or low-crime area, that’s no guarantee that a crime won’t occur. Plus, keep in mind that a criminal can be a neighbor, a neighbor’s guest, or even a tenant’s own guest.
  6. You think it’s not worth the bother because you’re just renting for a year or so. As mentioned above, obtaining adequate renter’s insurance is a fairly quick and easy process. Also, a policy provides the same coverage every day for as long—or as little—as it’s in place. So, if you rent an apartment for only a year, you’ll only pay premiums to cover that time period.