Discovering that an unauthorized person is living in your rental property is a very stressful situation. As a landlord, it is your duty to protect the property and ensure that only authorized and vetted individuals live in the unit. Unfortunately, despite having a rock-solid lease agreement, there may be times when a tenant’s guest(s) overstay their welcome, someone sublets the property illegally, or you find yourself dealing with a squatter that refuses to leave. Continue reading below as we discuss the types of unauthorized occupants plus steps to take when one moves into your rental.
What Constitutes as Unauthorized Occupant in Your Rental Property?
Defining an unauthorized tenant depends on a few factors. That said, some landlords do not care whether their tenants have extended guests or take in additional people that pitch in on monthly rent. So, the way these property owners see it, as long as rent is coming in, that’s all that matters.
However, for those who care whether an unauthorized occupant is staying in the rental, it is vital to understand what constitutes “unauthorized.” Most lease agreements provide that only the tenants on the lease, and no one else, can occupy the rental home. Therefore, any other person residing in the rental for any time is technically considered “unauthorized” according to the lease terms.
Types of Unauthorized Occupants
Understanding the different types of individuals to watch for will help owners identify unauthorized occupants. Continue reading below!
A guest is a visitor or family member who has taken up residence in your rental home with your tenant’s permission. They may stay for long periods and share some minor expenses, but they do not contribute to the monthly rent.
That said, some property owners will consider long-term guests as those who have taken up residence without their permission, even though their tenants invite them to stay. Additionally, some of these guests even go so far as to change their mailing address to match that of the property. Generally, long-term guests stay for a period greater than 2 weeks.
When tenants cannot fulfill their obligations for whatever reason, they may seek out a sublet tenant. These unauthorized occupants form an agreement with the tenant instead of the landlord. Therefore, when this occurs, your rental home has become the casualty of a sublease. For landlords, having an unvetted tenant that did not sign the original residential lease is detrimental.
Squatters, also referred to as trespassers, are people who enter your rental property without the permission of the property owner. The true definition of a squatter is someone who breaks into your vacant property, has utilities turned on, and begins living there. However, this complex issue involves many federal, state, and local laws. That said, if a property owner attempts to evict a squatter illegally, or the squatter remains in the property for a time with no attempt at concealment, the squatter may retain some rights. Thus, making a landlord’s problems far worse.
Additionally, if your tenant refuses to leave the property under legal circumstances or does not pay rent, they too are squatters.
Why Unauthorized Occupants Are a Problem for Landlords?
They Can Cause Property Damage – Authorized tenants are responsible for their guests’ actions, and therefore any damages may be covered by their renter’s insurance policy. That said, every insurance policy is slightly different, and therefore may not offer the same coverage. So, holding a guest or unauthorized occupant directly accountable for damages can prove difficult for landlords.
Rent is Not Being Paid – When an unauthorized occupant is not on the lease, they are not legally responsible for the rent. Therefore, landlords have a big problem! Getting an unauthorized occupant out will likely take a court eviction, which consumes both time and money for landlords. In the meanwhile, no rent is coming in.
The Lease is Unenforceable – Unauthorized occupants never signed the original leaser and therefore did not have to follow the rules laid out for the rental. This causes many potential issues such as noise complaints, parking violations, or HOA concerns that create added problems for the landlord with little recourse.
How to Handle an Unauthorized Occupant in Your Rental
Now that you have a general idea about unauthorized occupants in your rental property let’s look at how to handle each of these unfortunate situations below.
Dealing with Long-Term Guests
Experts advise building guest restrictions into the lease agreement to prevent over-stayers that do not contribute to the monthly rent. Often termed the “Use of Premises” clause, this might include a 10-day limit on guest stays in any 6-month period. Furthermore, if a tenant wishes to house a guest for longer, the agreement requires written approval from the owner.
It is also vital to outline the consequences of “hiding” long-term guests in the home, such as fines, rent increases, and even eviction. Besides, these unauthorized occupants are not subject to the terms, which means they cannot be held to any of the lease provisions. Therefore, strict rules are essential.
Rectifying a Sublet Property
One of the most surefire ways of avoiding a subleasing nightmare is by strictly forbidding it in your rental agreement. That way, should your tenant decide to sublease anyway, the landlord will have a strong defense. So, if you find yourself dealing with an unauthorized tenant, there are some important things to keep in mind. Check out these tips below for dealing with a sublease and unauthorized occupant.
Addressing Subleasing in the Lease – If you do not want to allow subleasing, state this in your lease agreement. Some states will not accept your claims of an unauthorized person if you do not note outright in your lease that subleasing is not allowed. That said, should you choose to allow subleasing, include airtight clauses requiring prior landlord permission. Also, require all sub-tenants to adhere to the same screening qualifications as your original tenants were. Lastly, require all parties to sign a newly drafted sublease agreement.
Do Not Collect Funds – Never collect rent from an illegal sub-tenant. Once a landlord accepts funds, specific tenant laws activate protecting the sub-tenant regardless of whether they are legally allowed to be in your property or not.
Eviction – If you are going to evict a sub-tenant, make sure to follow the correct procedures for a legal eviction to avoid getting yourself into trouble as well.
Handling a Squatter
If you ask someone to leave your rental property—whether an unauthorized guest or squatter—and they do not vacate, landlords are entitled to seek an eviction. To do so, owners must file a “wrongful detainer” action in District Court. A “wrongful detainer” means someone who holds possession of the real property, such as a house, apartment, building, or land, without the right of possession.
Steps for Wrongful Detainer Action
File a complaint in the District Court.
Court issues a summons to the person accused of wrongful possession of your property.
The unauthorized occupant will appear in court to explain why they are not in the wrong.
If the court sides with the landlord, owners will then be granted a warrant of restitution.
Landlords will then schedule a date with the sheriff to have the unauthorized occupant evicted from the property.
Again, it is critical to follow the legal regulations for properly evicting an unauthorized occupant in your investment property.
Tips to Avoid an Unauthorized Occupant
Develop a Thorough Screening Process – A landlord’s best defense is to have an in-depth screening process in place. The screening process needs to verify income, review criminal and credit history, as well as prior rental history.
Create a Well-written Legal Lease – A well-written and legally binding contract is the foundation for any landlord-tenant relationship. Additionally, ensure it states that if eviction proceeding s take place, the tenant is responsible for court costs and any incurred fees.
Foster Communication – Communication is critical for landlords. So, ensure you check in with residents and find out if they understand all policies. Sometimes an unauthorized occupant is just a misunderstanding.
Follow Through – When an unauthorized occupant is discovered, landlords may ask that they leave or be added to the lease. However, if they do not comply, landlords can legally evict them. So, always follow through on the consequences you warned them about.
The Simplest Way to Handle Unauthorized Occupants
Before you find yourself dealing with an unauthorized occupant in your property, consider the benefits of professional property management company. Employing a knowledgeable and experienced property management company can help manage all things property related.
Contact Overland Management today and let us take the stress and guesswork out of daily operations for you.
This article is not intended as legal advice and shouldn’t be construed as such. If you have questions please contact an attorney.