The Tenant Denial Letter “Part Two”

If after reviewing a prospective tenant (consumer and/or credit) screening report you determine that you are willing to accept the tenant on the condition that the tenant provides either a larger security deposit or a guarantor, must you provide a tenant denial letter with those conditions in compliance with the Fair Credit Reporting Act?  In other words, is a conditional denial deemed a denial that triggers an obligation to provide a denial letter?  The answer is yes!

  •   If you deny a prospective tenant based on conditional reasons like – I would accept you BUT …. I need a  larger security deposit

OR

  •   I need a Guarantor

That is a denial and you must provide a denial letter in a format that is in compliance with the Fair Credit Reporting Act. If you choose to email this letter, make sure to check the “request a delivery receipt” and then save both the email and delivery receipt in a folder.

Lastly, when you send out a denial letter, make sure the denial letter is sent to every applicant listed in the application & KEEP A COPY for at least 4 years.

When it comes to managing your single, multi-family or commercial properties, rest easy – Octazon Management has got you covered. Our full-service property management company can handle everything from maintenance and landscaping, to screening potential tenants, preparing leases, handling code violations, insurance claims & tax appeals, marketing, advertising and managing your properties online with our advanced technology that allows us to stay connected and maintain transparency with our clients.

When providing management services to Realtors, Octazon will NOT provide the leasing, rentals or sales– so you never have to worry about losing control of your relationship with the owner. 

With Octazon, we bring order to residential property ownership.

Call us at: 888-324-9528 or email us at: info@octazon.com today.

Check us out @ www.octazon.com

“Single Family Residential – REO – Multifamily – Commercial”

The Tenant Denial Letter “Part One”

You spoke to your perspective tenant, reviewed the application the tenant filled out and liked what you saw so far, so you ordered a tenant screening report. BOOM! Based on the report you pulled you need to deny the Tenant. Now what?  

Well a tenant denial is okay – so long as it is for legitimate reasons such as (a) credit history (b) criminal history (c) rental history or (d) income history and as long as your decision doesn’t violate the Fair Housing Laws,  the Fair Credit Reporting Act, or  local government and tenant protections.

Here is what you need to keep in mind. If you are going to deny a tenant based on something learned from the applicant’s consumer report or credit report – those reports you order from a tenant screening company containing information from a Credit bureau like TransUnion or Equifax, then you must send an Adverse Action Letter- aka a Tenant Denial Letter.

When you send the Tenant Denial letter, it is good practice to provide the perspective tenant with a free copy of the full Consumer & Credit Report, and provide the “Summary of Your Rights” document under the Fair Credit Reporting Act. Click on to http://hr.lafayette.edu/files/2011/01/Summary-of-Rights-Jan-1-2013.pdf   for a copy of these rights.  Note: If you do provide an applicant with a copy of their report then you must provide an applicant with a copy of the “Summary of Your Rights” document.

Stay posted for more tips on how and when to provide the tenant denial letter……….

 

When it comes to managing your single, multi-family or commercial properties, rest easy – Octazon Management has got you covered. Our full-service property management company can handle everything from maintenance and landscaping, to screening potential residents, preparing leases, handling code violations, insurance claims & tax appeals, marketing, advertising and managing your properties online with our advanced technology that allows us to stay connected and maintain transparency with our clients.

With Octazon, we bring order to residential property ownership.

Call us 888-324-9528 or email us at info@octazon.com today.

Check us out @ www.octazon.com

“Single Family Residential – REO – Multifamily – Commercial”

Super Priority Code Enforcement Liens Are Unconstitutional – New Supreme Court Ruling PART II

In my Blog in May 2013, regarding the Florida Supreme Court (S.C.) case of City of Palm Bay v. Wells Fargo Bank, I discussed that the court ruled that a municipal ordinance which grants municipal code enforcement liens super priority on par with real property taxes, is in conflict with Florida law.

The affect of this ruling is that municipalities may no longer assert that their code violation liens have priority over previously recorded mortgages. I mentioned that this decision is significant, as investors, lenders and purchasers in theory no longer have to worry about municipal liens taking super priority over their earlier recorded mortgages. However, regarding the application of how title underwriters will address this new ruling, I told you to stay tuned.

So now that some time has passed since this ruling, here is how some title underwriters are now handling the application of this new S.C.  decision.

Every code violation consists of two aspects to the violation: (1) the actual compliance with the violation (2) paying the monetary fine for the violation.

So while this new S.C. case resolves the monetary issues by taking away the super priority of lien, the title agent must still obtain written confirmation from the municipality that the property is in compliance and that the violation is no longer continuing on the property. The concern is once the foreclosure is complete and the property is now in the name of the lender, if the violation is still ongoing, the municipality may try to collect fines and may even re-lien the property. Also,  despite the S.C. ruling , if the municipality claims money is still due, then the title agent must get the municipality to agree, in writing, no money is due based on the S. C. ruling.

So as a result of this S.C. ruling, title agents will no longer need to obtain a release of lien to clear title or pay any fine, if: (a) the municipal lien is subordinate to the mortgage being foreclosed and (b) the municipality is properly named and served in the foreclosure action and (c ) the property is in compliance.   

While this is how some title underwriters are deciding to approach the S.C.  ruling we still don’t know how the municipalities are going to apply the S.C. case.  So I guess we still need to stay tuned.

When it comes to managing your single and multi family residential properties, rest easy – Octazon Management has got you covered. Our full-service property management company can handle everything from maintenance and landscaping, to screening potential residents, preparing leases, marketing, advertising and managing your properties online with our advanced technology that allows us to stay connected and maintain transparency with our clients.

With Octazon, rest easy, because we bring order to residential property ownership.

 Call us 888-324-9528 or email us at info@octazon.com today or check us out @ www.octazon.com

“Single Family Residential – REO – Multifamily – Commercial”