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Tenants can’t pay rent but I need to pay my mortgage
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amother




OP
 

Post  Sun, Apr 05 2020, 9:01 am
What would you do?
Baruch Hashem were zoche to buy an apartment in Israel (where are are already zoche to live.) We’ve been in the processing of buying the apartment for the past several months. Due to constraints that were not our own we were only able to get a mortgage last week at a rate SIGNIFICANTLY higher than what we had anticipated due to corona. It’s costing us almost 1000 shekel more per month. There are currently tenants in the apartment whose lease is over mid August. Our lease is up mid July and our landlord will not extend our lease. We knew this before we had signed and our plan was to offer the current tenants free rent for June if they leave before July. The tenants verbally agreed to leave early if they found an apartment that suited them.
I messaged the tenant that I found an apartment next door that is exactly the same layout as their apartment that is up for rent now. She said they have 0 income now.

The apartment is now ours and we found out that the tenants have not been paying building maintenance fees for the past month and a half. They requested that we cash their April check later, but did not specify when. Up until corona their source of income came from running a private daycare. They will likely not have a steady income until schools are back in session which could be months.
We understand that they are going through a tough time financially, but at the same time it won’t be easy for us financially either paying rent and mortgage at the same time (remember -mortgage is a lot higher than we had anticipated). We don’t want to be heartless, but we don’t want to be push overs either. How would you deal with this situation?

Update: Good news! Bh they paid us and are moving out today!
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amother




Seafoam
 

Post  Sun, Apr 05 2020, 9:06 am
amother [ OP ] wrote:
What would you do?
Baruch Hashem were zoche to buy an apartment in Israel (where are are already zoche to live.) We’ve been in the processing of buying the apartment for the past several months. Due to constraints that were not our own we were only able to get a mortgage last week at a rate SIGNIFICANTLY higher than what we had anticipated due to corona. It’s costing us almost 1000 shekel more per month. There are currently tenants in the apartment whose lease is over mid August. Our lease is up mid July and our landlord will not extend our lease. We knew this before we had signed and our plan was to offer the current tenants free rent for June if they leave before July. The tenants verbally agreed to leave early if they found an apartment that suited them.
I messaged the tenant that I found an apartment next door that is exactly the same layout as their apartment that is up for rent now. She said they have 0 income now.

The apartment is now ours and we found out that the tenants have not been paying building maintenance fees for the past month and a half. They requested that we cash their April check later, but did not specify when. Up until corona their source of income came from running a private daycare. They will likely not have a steady income until schools are back in session which could be months.
We understand that they are going through a tough time financially, but at the same time it won’t be easy for us financially either paying rent and mortgage at the same time (remember -mortgage is a lot higher than we had anticipated). We don’t want to be heartless, but we don’t want to be push overs either. How would you deal with this situation?

Banks are freezing mortgage payments for the next three months. Your issue is how to pay your rent, not how to pay your mortgage.
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rivkam




 
 
 
 

Post  Sun, Apr 05 2020, 9:12 am
Getting tenants out legally is abit of a nightmare and I imagine even more so now. Courts may favor them. If you really want, get a lawyer who you know to write you a letter stating the law and the relevant penalties. You are allowed to use limited force to evict them although I wouldn't go that route.
I would make sure to get everything in writing down to a written and signed statement from them about the events. You could offer for them to pay in installments. At the end of the day, they cant expect you to foot their rent bill. Everyone should have some money set aside for emergencies. This is the time to use it.
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amother




Seafoam
 

Post  Sun, Apr 05 2020, 9:18 am
rivkam wrote:
Getting tenants out legally is abit of a nightmare and I imagine even more so now. Courts may favor them. If you really want, get a lawyer who you know to write you a letter stating the law and the relevant penalties. You are allowed to use limited force to evict them although I wouldn't go that route.
I would make sure to get everything in writing down to a written and signed statement from them about the events. You could offer for them to pay in installments. At the end of the day, they cant expect you to foot their rent bill. Everyone should have some money set aside for emergencies. This is the time to use it.

Everyone, especially homeowners, should have money set aside for emergencies.

If OP's issue is how to pay rent and mortgage at the same time, it's a non-issue, because she won't be paying her mortgage for another 3 months anyways.
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tryinghard




 
 
 
 

Post  Sun, Apr 05 2020, 9:27 am
For all those say “she won’t be paying her mortgage now” - I don’t know how it’s working in Israel, but in the US, it’s a very individual experience. My friend’s bank essentially said, “ Sure you can defer mortgage payments for three months... but at the end of that time period we can and will demand all that money at once”, as opposed to extending the loan period or spreading those payments out over the length of the loan, which leaves her in a worse financial position than before.
And the you have my bank, which took our information weeks ago and has yet to get back to us.
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amother




Blue
 

Post  Sun, Apr 05 2020, 9:29 am
rivkam wrote:
Getting tenants out legally is abit of a nightmare and I imagine even more so now. Courts may favor them. If you really want, get a lawyer who you know to write you a letter stating the law and the relevant penalties. You are allowed to use limited force to evict them although I wouldn't go that route.
I would make sure to get everything in writing down to a written and signed statement from them about the events. You could offer for them to pay in installments. At the end of the day, they cant expect you to foot their rent bill. Everyone should have some money set aside for emergencies. This is the time to use it.


It is heartless and extreme rishus to evict a tenant now. Especially a tenant that always paid rent.
I did not pay rent yet this month. Many many people simply don't have.
It is irresponsible to own a house on the account that you'll have a paying tenant. It means that you can't afford to own. It's not a given that you'll always find a tenant and that the apartment won't sit empty.
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amother




Seafoam
 

Post  Sun, Apr 05 2020, 9:35 am
tryinghard wrote:
For all those say “she won’t be paying her mortgage now” - I don’t know how it’s working in Israel, but in the US, it’s a very individual experience. My friend’s bank essentially said, “ Sure you can defer mortgage payments for three months... but at the end of that time period we can and will demand all that money at once”, as opposed to extending the loan period or spreading those payments out over the length of the loan, which leaves her in a worse financial position than before.
And the you have my bank, which took our information weeks ago and has yet to get back to us.

She said she is in Israel - in Israel banks are freezing mortgage payments for 3 months. Could be she has to call them and ask, but there is no bureaucracy involved, it is automatic approval.

It does not mean she gets hit with all of it at once after the end of 3 months. Regardless this is across the board, not dependent on her bank.

https://www.globes.co.il/news/.....21676
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amother




Seafoam
 

Post  Sun, Apr 05 2020, 9:36 am
amother [ Blue ] wrote:
It is heartless and extreme rishus to evict a tenant now. Especially a tenant that always paid rent.
I did not pay rent yet this month. Many many people simply don't have.
It is irresponsible to own a house on the account that you'll have a paying tenant. It means that you can't afford to own. It's not a given that you'll always find a tenant and that the apartment won't sit empty.

This, a million times this. Every word of it.
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amother




OP
 

Post  Sun, Apr 05 2020, 9:48 am
Op here. We wouldn’t evict them chas vshalom. We would like to financially encourage them to leave early. There are a ton of places to rent in the neighborhood that are similar In size and price or smaller and cheaper. They would have had to leave August regardless. My questions are
- if you were the tenant (knowing only the info that I gave you), what would encourage you to leave earlier?
- even if we were to forget payments until September, when hopefully they’ll have an income, how can we be sure that we’ll actually get the money?
Would it be fair to ask them for checks for sept to Jan when hopefully they’ll have the money and agree not to cash the checks for April- August? They’ll have to pay double rent during that time period... but at least they’d know this information when searching for a new apt to rent come August.
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amother




Puce
 

Post  Sun, Apr 05 2020, 9:51 am
amother [ Blue ] wrote:
It is heartless and extreme rishus to evict a tenant now. Especially a tenant that always paid rent.
I did not pay rent yet this month. Many many people simply don't have.
It is irresponsible to own a house on the account that you'll have a paying tenant. It means that you can't afford to own. It's not a given that you'll always find a tenant and that the apartment won't sit empty.


Just wondering,
Why would someone have a tenant if they could afford not to?
Why is it not a person's achrayos to pay their rent?
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momofqts




 
 
 
 

Post  Sun, Apr 05 2020, 9:54 am
amother [ OP ] wrote:
Op here. We wouldn’t evict them chas vshalom. We would like to financially encourage them to leave early. There are a ton of places to rent in the neighborhood that are similar In size and price or smaller and cheaper. They would have had to leave August regardless. My questions are
- if you were the tenant (knowing only the info that I gave you), what would encourage you to leave earlier?
- even if we were to forget payments until September, when hopefully they’ll have an income, how can we be sure that we’ll actually get the money?


Sounds like youre being so mentchlich about this. I question if you will ever get all the money. What would help them is likely moving expnses and security deposit in the next apt. I would do it on condition that they move immediately.
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amother




Seafoam
 

Post  Sun, Apr 05 2020, 9:59 am
amother [ OP ] wrote:
Op here. We wouldn’t evict them chas vshalom. We would like to financially encourage them to leave early. There are a ton of places to rent in the neighborhood that are similar In size and price or smaller and cheaper. They would have had to leave August regardless. My questions are
- if you were the tenant (knowing only the info that I gave you), what would encourage you to leave earlier?
- even if we were to forget payments until September, when hopefully they’ll have an income, how can we be sure that we’ll actually get the money?
Would it be fair to ask them for checks for sept to Jan when hopefully they’ll have the money and agree not to cash the checks for April- August? They’ll have to pay double rent during that time period... but at least they’d know this information when searching for a new apt to rent come August.

I would sign a new contract with them about when you're going to get the money. In this case (check with a lawyer) a computer-signed contract should be fine. You can decide at what point you will begin cashing checks again, and then cash one a month/ take a higher amount each month until they have fully paid what they owe. But again, make sure you agree on it in writing, have a "corona contract."

If I were the tenant, offering to help foot my moving bill might help. Because someone who can't pay rent certainly can't pay moving expenses. But would I ask that? Certainly not.
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amother




Seafoam
 

Post  Sun, Apr 05 2020, 10:04 am
amother [ Puce ] wrote:
Just wondering,
Why would someone have a tenant if they could afford not to?
Why is it not a person's achrayos to pay their rent?

It's the culture here.

You buy, depend on someone else to pay the mortgage, and you choose one of two options: a) move in when the apartment suits you (when your kids are older, when you have more kids, when you find a job in that area, etc.), b) you never move in, and when the mortgage is paid off you keep earning an income that supports you in your old age or when you're starting to marry off your kids.

In some cases you can have a mortgage that is significantly lower than the rent you can demand, and then you make a nice income each month off the difference. People would do that with a few apartments, and with the 1,000 difference (mortgage 2,400 for example, rent charged 3,500) times three, that's a nice chunk of money each month. Then they put a tax on third apartments so many sold them, but this still goes on. It is a nice way to support a kollel lifestyle, if you were lucky enough to buy cheap and rent has gone up in the meantime.
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amother




Gray
 

Post  Sun, Apr 05 2020, 10:08 am
amother [ Blue ] wrote:
It is heartless and extreme rishus to evict a tenant now. Especially a tenant that always paid rent.
I did not pay rent yet this month. Many many people simply don't have.
It is irresponsible to own a house on the account that you'll have a paying tenant. It means that you can't afford to own. It's not a given that you'll always find a tenant and that the apartment won't sit empty.
[u]



I agree that it would be cruel to evict tenants now.

Why is it irresponsible for a homeowner to rely on a tenant's rent to pay the mortgage? How is it irresponsible and how does it demonstrate the home owner really can't afford the house?

Is a persons income from a job guaranteed? Do people not occasionally lose their jobs and become unemployed? You'd probably agree that it's reasonable to rely on one's income to pay the mortgage.
Why isn't rental income similar to employment income? They are both reasonably relied on while at the same time c'vs things can happen and they are lost. I don't think most apartments sit vacant for any extended amount of time unless of course the homeowner is unreasonable about the price of rent.
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amother




Seafoam
 

Post  Sun, Apr 05 2020, 10:17 am
amother [ Gray ] wrote:
[u]



I agree that it would be cruel to evict tenants now.

Why is it irresponsible for a homeowner to rely on a tenant's rent to pay the mortgage? How is it irresponsible and how does it demonstrate the home owner really can't afford the house?

Is a persons income from a job guaranteed? Do people not occasionally lose their jobs and become unemployed? You'd probably agree that it's reasonable to rely on one's income to pay the mortgage.
Why isn't rental income similar to employment income? They are both reasonably relied on while at the same time c'vs things can happen and they are lost. I don't think most apartments sit vacant for any extended amount of time unless of course the homeowner is unreasonable about the price of rent.

Depends on the area and the rent you're charging. And a lot of it depends just on siyata dishmaya.

In my area a lot of people buy apartments for "investment" but there aren't enough renters so many sit empty. It's not unusual for an apartment to sit empty for 2-3 months, or even for six months.

Most people don't lose their jobs every year or two, but it's not unusual to have to find a new renter every year or two.

And, even if the apartment is new, there may be expensive fixes that need to be made. So really you need to have some kind of emergency fund regardless of whether the apartment will ever sit empty (and it probably will at some point).
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Aylat




 
 
 
 

Post  Sun, Apr 05 2020, 10:24 am
amother [ Seafoam ] wrote:
It's the culture here.

You buy, depend on someone else to pay the mortgage, and you choose one of two options: a) move in when the apartment suits you (when your kids are older, when you have more kids, when you find a job in that area, etc.), b) you never move in, and when the mortgage is paid off you keep earning an income that supports you in your old age or when you're starting to marry off your kids.

In some cases you can have a mortgage that is significantly lower than the rent you can demand, and then you make a nice income each month off the difference. People would do that with a few apartments, and with the 1,000 difference (mortgage 2,400 for example, rent charged 3,500) times three, that's a nice chunk of money each month. Then they put a tax on third apartments so many sold them, but this still goes on. It is a nice way to support a kollel lifestyle, if you were lucky enough to buy cheap and rent has gone up in the meantime.


Read the OP. This has nothing to do with her situation. They aren't her tenants; she bought the house from their landlord and wants to move in.
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amother




Peach
 

Post  Sun, Apr 05 2020, 10:25 am
amother [ Blue ] wrote:
It is heartless and extreme rishus to evict a tenant now. Especially a tenant that always paid rent.
I did not pay rent yet this month. Many many people simply don't have.
It is irresponsible to own a house on the account that you'll have a paying tenant. It means that you can't afford to own. It's not a given that you'll always find a tenant and that the apartment won't sit empty.


It’s irresponsible as a tenant not to have a few months of reserve. What a chutzpa to say that it’s irresponsible to rely on the tenant to pay on time!
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amother




Cerulean
 

Post  Sun, Apr 05 2020, 10:30 am
I don’t get why you would close a week ago. It wasn’t bashert. You may be able to rescind the mortgage because it’s within the 30 days. They approved you with the assumption you would have I come from the apartment and now you don’t. If you are emotionally too attached To the apartment, why don’t you move to the temp apartment for the month? I think the tenants will stay as long as legally allowable.
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sub




 
 
 
 

Post  Sun, Apr 05 2020, 10:30 am
Don’t renters give head checks in israel?
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amother




Seafoam
 

Post  Sun, Apr 05 2020, 10:30 am
Aylat wrote:
Read the OP. This has nothing to do with her situation. They aren't her tenants; she bought the house from their landlord and wants to move in.

I was responding to a specific poster's question, not to the OP.
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