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What Is A Criminal Background Tester?

These are also referred to as Fair Housing Testers. If you are a landlord, you should know what they are and why they are contacting you. 

The Fair Housing Amendments Act was passed in 1988. Because of it, landlords are legally prohibited from rejecting a renter’s application due to age, race, sex, religion, or national origin.

For anyone who rents properties, you should be aware that people and groups may apply to ask about renting from you. Their sole purpose is to see if you are employing discriminatory practices in your application process. 

Criminal Background Checks

Landlords can and do run criminal background checks on future tenants. But is this method for screening discriminatory?

This is a question that The Department of Housing and Urban Development had to address. Landlords wanted to know more about the people that were going to live on the property. Did the future tenant commit violent acts, destroy property, or illegally sell drugs or weapons? 

Maybe the criminal background checks were not discriminatory, but were they indirectly acting as such? HUD references disparate impact theory. It elaborates on things that are not in and of themselves to be discriminatory but can still have the same effect. 

For instance, if a landlord had a policy that she would not rent to anyone with red shoes, it doesn’t discriminate against race, sex, or religion. But what if a local church had members who only wore red shoes? 

HUD’s guidance to landlords is that it should not impact a protected person if they do background checks. Because disparate impact discrimination is indirect, people can be accused of discrimination without intending to be. 

Be Fair & Consistent

If you do not understand the Fair Housing Amendments Act, contact an attorney who works with landlords. There are several ways they can help. You want to ensure that nothing you do is perceived or misunderstood to be an act of discrimination. 

There are people who will test you. They are criminal background testers. You may meet them in person, or they could call. Either way, they will pose as potential applicants. 

This is where fairness and consistency counts. For instance, how do you respond if someone calls and asks if her background will be an issue? How can you give a definitive answer because you do not know this person, nor have you done a background check? Perhaps you should make a policy that you don’t turn people away unless they have completed an application. 

If this is your policy, then simply invite this person to submit a rental application. Then, and only then, will you be able to make an informed decision. 

Atlas Law

As a landlord, it is your responsibility to act within the law. When you work with Atlas Law, it is our job to ensure you understand how to comply with them. If you are a landlord who needs legal advice about evictions, contact us to schedule a consultation. Atlas Law handles eviction and real estate cases throughout the entire state of Florida.

How To Handle Bad Tenants

Though your bad tenants will likely (hopefully) be just a small portion of the people you rent to, they have the potential to take up a considerable amount of your time. When this happens, you devote too many minutes of your day trying to fix problems rather than growing your property management business. 

Common types of problems you are likely to encounter are people who destroy your property, who fail to pay their rent, or a combination of the two. This is when they violate their lease agreement, the document that outlined how much they would pay you in rent and how they would conduct themselves while living on your property. 

The quick response (but definitely not the quickest solution) is to move towards evicting them. Unfortunately, this is a timely process that incorporates lawyers, a legal process, and odds are, your renters will continue to violate their lease as you try to remove them from your property. Although eviction can still be inevitable, here are some steps to take before it gets there.

Prevent It Early 

Spend the time to develop a robust background screening process. This isn’t as complicated as it may sound. Try to focus on three things: employment, previous addresses, and credit scores. For the first two, verify that they are employed and try to talk to a previous landlord. Even though the former landlord has no reason to help you, they will not be able to hide their feelings for a tenant who didn’t pay rent or abused their property.

A credit check might cost upwards of $50, but it is an investment. It’s significantly cheaper than the cost of the eviction process. When you are meeting with the tenant, they will have to give their Social Security number and authorize you to run the credit check. And when you meet with them to show the property, ask questions and get a feel for who might be moving into your property.

Renters Who Won’t Pay

As much as it might upset you that they are not paying, don’t immediately assume that your tenant is doing so aggressively. If you are short on money because your tenants won’t pay, you are going to struggle financially due to no specific fault of your own.

Perhaps your tenant lost their job or is in the middle of a crisis. Trying to help them might go a long way for establishing a long-term professional relationship with them. To do this, consider putting them on a payment plan. A portion of your rent is better than none, and you will be establishing this plan for them to pay you the rent in full eventually. 

Another option is to see if they would consider having a roommate if the living space can accommodate it. They will get to pay less, and you will receive the entirety of your rent. 

Atlas Law 

At Atlas Law, we are equipped to cover eviction and real estate cases throughout the entire state of Florida. If you own property—or you’re a corporation that owns several properties—Atlas Law can be your single source for eviction proceedings. Contact us online to schedule a consultation.

Florida Landlords- Your Duty to Repair Explained

When you rent out an apartment, home, or other residential accommodation, you have certain responsibilities as a landlord. Foremost among them is the obligation to keep the unit in good condition. In this blog, we’ll review your responsibility when it comes to repairs and go over situations when the cost can come out of your tenant’s security deposit.

Landlord’s Duty to Repair in Florida

During the tenancy, you must maintain the structural elements of the unit or building, including the roof, floors, steps, windows, doors, and exterior walls. Your other maintenance responsibilities include: 

  • Keeping the heating and plumbing in good shape
  • Exterminating vermin and insects
  • Keeping common areas in a safe and clean condition
  • Maintaining working smoke detection devices
  • Repairing any damage to screens annually

If a tenant requests repairs, you have up to seven (7) days to complete them, provided that request involves an issue that violates Florida’s warranty of habitability. While it is typically your responsibility to cover the repair costs, under certain circumstances you may be able to deduct it from the tenant’s security deposit. 

Using the Security Deposit for Repair Costs

While you cannot normally deduct repair costs related to ordinary wear and tear, one of the purposes of a security deposit is to cushion you financially against any property damage that could result from tenant negligence or carelessness. Examples include:

  • Smashed or broken bathroom or kitchen fixtures
  • Floors or carpets damaged by pet urine
  • Doors broken off the hinges
  • Broken windows
  • Cracked or broken tiles
  • Deeply scratched hardwood floors

If your tenant causes this type of damage, you are legally permitted to deduct reasonable repair costs from their security deposit. 

What if the Tenant Objects to Using Their Security Deposit?

Your tenant may object to you using the security deposit to cover damages that they caused, either directly or indirectly. If the situation looks like it may escalate or you aren’t sure if you can deduct for certain damages, your best option is to consult with the Florida landlords’ rights attorney who can explain how state law applies to your situation.

Do You Need to Speak With a Florida Property Law Attorney?

If you are a Florida landlord with questions about your obligation to cover repair costs, let the landlord-tenant lawyers at Atlas Law help. The right advice from an attorney can ensure that any repair deductions are legally valid and, if the situation does escalate, we will protect your rights at any subsequent hearings or legal actions. To schedule a consultation today, call 813.241.8269.

5 Characteristics of a Good Investment Property

If you’re thinking about investing in a rental property, now is a better time than ever. Many people are putting off buying their first homes until they’re at least 30. According to M Report, the average age of homeowners is on the rise, especially in Florida, where Tampa homeowners have an average age of 58.3 years. Until they’re ready to buy, Floridians are living in rental properties like apartment buildings and mobile home communities.

However, not all properties on the market are a wise investment. Before you make an offer, confirm that it has the potential to deliver a reliable and ongoing cash flow. In this blog, we’ll identify 5 characteristics of a good investment property and how to spot them.

  1. Urban Location

While the idea of living in a remote beach house sounds divine, most renters want to be close to shopping malls, public transportation, and workplaces – all amenities that tend to make home buying in the area too expensive for them. Choose a property in a convenient location and you’ll rarely be short of tenants. 

  1. Strong Job Market

Areas with strong job opportunities always attract more tenants. If you see an announcement about a major employer moving to the area, you can practically count on people arriving in search of work. Demand for rentals will be higher, so your apartment building or mobile home community may receive more applications than you can accommodate.

  1. Good School District

Many young families choose to rent while they save up for a home, so the quality of local schools is important. When possible, parents will pay more to rent properties in a desirable school district. Visit Trulia Neighborhoods to learn more about the schools in the area.

  1. Neighborhood Type

The type of tenants you attract (and your vacancy rate) will be dictated by the neighborhood. For example, if you buy an apartment building near a college, you’ll be full during the school year and dealing with summer vacancies. On the other hand, a quiet neighborhood with shops within walking distance will attract young professionals and families who represent a reliable source of rental income all year round.

  1. Rent is Sustainable

The goal of an investment property is to make money. The general rule is that if the rent you can charge is 1% of the sale price, it may be a good opportunity. For example, if a home is for sale at $250,000 and you know you can rent it for $2,500, consider it further. You also want the mortgage payment (insurance and taxes not included) to be less than 50% of the rent, or you won’t make much money over the long term.

Do You Need a Florida Real Estate Attorney?

It may take a lot of research and footwork to identify the right investment property but when it happens, a Florida real estate attorney can guide you through the negotiation and closing processes. At Atlas Law, we support property investors by providing solid legal advice and due diligence services that verify the quality of their new opportunity. To schedule a consultation, contact us today at (813) 241-8269.

As you have likely heard, the Centers for Disease Control and Prevention (the “CDC”) issued an agency order (the “Order”) attempting to halt all residential evictions due to nonpayment until December 31, 2020. Yes, the CDC is now putting their gloved hands into the residential tenancy realm, effectively attempting to materially alter the already tumultuous landscape that we are presently facing. The Order is set to be codified on September 4th, 2020. A copy of the Order is attached as Exhibit A. According to the CDC, the Order seeks to “prevent the further spread of COVID-19” by imposing a nationwide moratorium on evictions. It is important to note that the Order does not immediately require landlords to refrain from filing eviction actions due to nonpayment. Instead, the Order prevents landlord from filing nonpayment, residential evictions ONLY WHEN the tenant provides a signed declaration, which is discussed below. 

While we disagree with the CDC’s logic, reasoning, and actions taken, it is important to understand how this Order affects tenancies, and what responsive measures are required. On its surface, the Order appears to be unconstitutional, or enacted without appropriate authority. However, attempting to directly fight the enactment of the Order through legal efforts (e.g. a lawsuit against the CDC) isn’t something that most landlords would want to finance. Moreover, the likelihood that a decision would be made regarding the constitutionality of the Order within a reasonable amount of time is not good. As a result, the best remedy that we have is to arm ourselves with specific knowledge regarding the ins and outs of the Order. 

Before we go through the details regarding the Order, it is important to understand that landlords can still file eviction actions against residential tenants for nonpayment of rent. The Order creates an exception to that general rule. The exception is that no action can be taken to remove a tenant from a property if the tenant has provided the landlord a signed, written declaration in the form of Exhibit B. Reports of the CDC Order generally state that there is a national eviction moratorium. That is not entirely true. The Order creates an “opt-in” moratorium, which is limited to people who meet the specific criteria contained in the Order. It is not as far-reaching as is being reported in the news. 

Applicability 

The first question we have to answer is whether the Order applies in Florida. The Order expressly states that it “does not apply in any state, local, territorial, or tribal area with a moratorium on residential evictions that provides the same or greater level of public-health protection that the requirements listed in this Order.” It is unclear whether Florida’s current moratorium provides the “same or greater level of public-health protection” as the Order. Florida’s eviction moratorium requires tenants to demonstrate that they have suffered a “COVID-related loss” that prevents them from paying their rent. Similar to the Order, the Florida eviction moratorium requires a tenant to provide proof to the Judge that the tenant qualifies for protection under the moratorium. Just like the Order, Florida’s moratorium does not allow tenants to be removed from their homes so long as the moratorium is in effect. The Order and the Florida moratorium are different, in that Florida requires the loss of income to be “COVID-related.” Additionally, the Florida moratorium allows landlords to send demand letters, file for eviction, and receive final judgments. The Florida moratorium only requires that no “final action” be taken to remove tenants from a property while the moratorium is in effect. Whether the Florida moratorium or the Order provides more protection truly depends on the facts for each particular tenant. 

It should also be noted that the true intent of this Order was to provide a moratorium in states and cities where an active moratorium was not already in place: 

“The Federal moratorium, however, did not reach all renters. Many renters who fell outside the scope of the Federal moratorium were protected under State and local moratoria. In the absence of State and local protections, as many as 30-40 million people in America could be at risk of eviction.” 

Interpreting this paragraph above, an argument could be made that this CDC Order does not apply to Florida or any state/city that has an existing moratorium. The concerns stated in the Order are already being addressed in the State-level moratorium, therefore the CDC Order is inapplicable in the state of Florida. Unfortunately, that is only an interpretation, and does not necessarily reflect what the final decision will be regarding applicability of the Order. 

Just as the applicability of the Order in Florida is unclear, the answer as to who determines whether the Order applies in Florida is equally unclear. Is it the CDC that makes the determination regarding applicability, or is it Florida’s Governor who issued the Florida eviction moratorium? Will it be local Judges who make the decision, or will the Florida Supreme Court issue an administrative order declaring which eviction moratorium should apply? These are questions that we simply cannot answer at this stage. What we can advise is that landlords have the ability to comply with both moratoriums simultaneously, and that landlords may still conduct evictions due to nonpayment of rent. To ensure proper compliance, it is important to understand how the Order works. 

How does the Order work? 

In this newly enacted Order, the CDC made the following key declarations to take effect on September 4th: 

“Under this Order, a landlord, owner of a residential property, or other person with a legal right to pursue eviction or possessory action, shall not evict any covered person from any residential property in any jurisdiction to which this Order applies during the effective period. This Order does not apply in any State, local, territorial, or tribal area with a moratorium on residential evictions that provides the same or greater level of public-health protection than the requirements listed in this Order.”

There are a few things to unpack in this paragraph above. First, we will focus on how the CDC defines a “covered person.” A “covered person” is defined as: 

“any tenant, lessee, or resident of a residential property who provides to their landlord, the owner of the residential property, or other person with a legal right to pursue eviction or a possessory action, a declaration under penalty of perjury indicating that: 

1) The individual has used best efforts to obtain all available government assistance for rent or housing; 

2) The individual either (i) expects to earn no more than $99,000 in annual income for Calendar Year 2020 (or no more than $198,000 if filing a joint tax return),6 (ii) was not required to report any income in 2019 to the U.S. Internal Revenue Service, or (iii) received an Economic Impact Payment (stimulus check) pursuant to Section 2201 of the CARES Act; 

3) the individual is unable to pay the full rent or make a full housing payment due to substantial loss of household income, loss of compensable hours of work or wages, a lay-off, or extraordinary out-of-pocket medical expenses; 

4) the individual is using best efforts to make timely partial payments that are as close to the full payment as the individual’s circumstances may permit, taking into account other nondiscretionary expenses; and 

5) eviction would likely render the individual homeless— or force the individual to move into and live in close quarters in a new congregate or shared living setting— because the individual has no other available housing options.” 

In order to qualify as a “covered person” the tenant will have to jump through some hoops. The tenant will need to attempt to procure government assistance; the tenant will have to demonstrate that he/she is making best efforts to pay at least a portion of the rent; the tenant will have to show that he/she suffered an income loss; and the tenant will have to show that he/she would be forced into a communal living situation or homelessness if evicted. Looking at the criteria listed above, it appears to be a difficult task for a tenant to prove that they are in fact “covered” under this Order. If the tenant does not issue a declaration to the landlord, then the tenant cannot receive any protection under the Order. If a tenant signs and delivers a declaration to the landlord, it should be examined to ensure that the tenant is being truthful. The declaration is supposed to be made under penalty of perjury, and the Order provides that untruthful statements by a tenant could subject the tenant to fines, imprisonment, or both. 

In addition to “covered person” the Order defines the term “evict.” According to the Order, “evict” and “eviction” means “any action by a landlord . . . to remove or cause the removal of a covered person from a residential property.” By defining eviction this way, the Order requires that once a tenant has provided a landlord with a signed, written declaration, the landlord may not take any further action to attempt to remove the tenant. This means that once a declaration is received, the landlord would not be allowed to send a standard rent demand letter, as a rent demand letter requests either payment in full or possession of the premises. It is very important that landlords be aware of who has sent in a declaration and who has not. If a declaration is received, the landlord should immediately cease any further action with regard to the tenant, and consult with legal counsel on the next steps. 

Penalties for Violation 

There are severe civil and criminal penalties for violating the Order. The Order states that an organization that violates the Order is subject to a fine of no more than $200,000.00 per event if the violation does not result in death, or $500,000.00 per event if the violation results in death. The Order also provides penalties for individuals who violate the Order, which includes one year of jail time for each violation. 

What does this mean for evictions? 

We have arguments that we can make to a judge or any decision-maker that the CDC Order should not apply, but what does the landlord do right now to put themselves in the best position possible in the wake of this Order? Answer- get any rent-based evictions out as soon as possible. We do not know for certain the extent of the applicability of this Order, but we do know that if we wait instead of act, we may find ourselves having to overcome even more hurdles. The only time an eviction action cannot be filed is if a tenant submits a written, signed “declaration” to the landlord that complies with the language stated in the Order. A copy of the form declaration is attached hereto as Exhibit B. Once you receive a signed declaration, you should immediately provide it to your legal counsel and cease collections and eviction efforts until advised otherwise. 

If you haven’t received a declaration from a tenant, then you are free to move forward with eviction of that tenant due to nonpayment of rent. It is incumbent on the tenant to advise the landlord or the Court that the tenant is claiming entitlement to the protections of either the CDC Order or the Florida eviction moratorium. Until the tenant takes this step, the landlord may evict the tenant. It is advisable to file any nonpayment eviction actions as soon as possible, before additional restrictions are imposed and before tenants begin sharing information regarding the Order. 

The State and Federal government can continue to move the goalposts on us, but we will remain vigilant and will continue to adjust course, as necessary. If you have any questions on this memorandum, please do not hesitate to contact the attorneys at Atlas Law at 813.241.8269 or brian@atlaslaw.com. 

Respectfully, 

ATLAS LAW 

Understanding Contingencies

Real estate contracts usually include provisions called “contingencies.” Never heard this word before? Not to worry! Today’s blog post breaks down what contingencies are and how they work when it comes to real estate.

Contingencies are essentially provisions included in a contract that will make the whole thing null and void if certain events do or do not occur. In essence, they note that “I will fulfill my side of this agreement, contingent upon x, y, or z.” You could also think of contingencies as conditions of your contract and sometimes they’re even referred to conversationally as conditions. Buyers and sellers are each able to propose contingencies as a way to protect themselves. Contingencies can also be bargaining chips. Let’s look at some of the most common examples of contingencies found in real estate contracts.

Contingency Regarding Selling Another Property: Perhaps the buyer only wants to and is able to buy a new house if they’re able to sell they’re old house. If, for instance, their old home is under contract, they can propose a contingency that their participation in the contract for the new house is contingent upon the sale of their old house going through. If you’re thinking this doesn’t sound very appealing to the seller, you’re right! The seller does not have to accept the contingency. Whether they do will likely depend on how confident they are in their ability to get another option. They could also potentially say, “Yes, I’ll accept this contingency, but only in exchange for increasing the price by so-and-so amount.”

Contingency Regarding Appraisal or Inspection: Buyers who want to make sure the value of the property they’re buying is consistent with what they’ve been told or their personal assessment may request contingency based upon a professional appraisal. You can also request contingency based on inspection to make sure there aren’t any flaws that need to be fixed for a high price. This gives you room to negotiate for a lower price or even back out altogether if you learn the property is worth less than expected. 

Contingency Regarding Mortgage Approval: Oftentimes, real estate contracts include a contingency for approval of the buyer’s mortgage. These can be quite specific, and may clarify that the terms of the mortgage approved must be the same as the terms stated in the contract.

When it comes to contingencies, these examples really only represent the tip of the iceberg. Still, we hope it gives you some clarity on what these provisions are and how you might be able to utilize them in your real estate contact. As always, if you have questions about this or any other matter related to real estate law, the Atlas Law team is here to help. Contact us today!

How to Have a Successful Open House — Virtually!

We are all slowly adjusting to live in the wake of coronavirus. Quarantining and stay-home orders have been a difficult adjustment for the real estate world, but we’re quickly finding ways to adapt. For example, some sellers and their real estate agents are now opting to host virtual open houses. In other words, they are using online platforms such as Zoom, Skype, and FaceTime to allow potential buyers to check out properties from the safety of their own homes. First impressions matter, even when they’re virtual. Read on to discover the Atlas Law team’s tips for a successful virtual open house.

1. Don’t forego cleaning. 

Just because buyers won’t physically be there to poke around doesn’t mean you shouldn’t make sure your house is spic and span before showing it off. If a potential buyer is curious about closet space you want to be able to open the closet door to show them without worrying about piles of dirty laundry tumbling out. Clutter is a bad look for any open house. 

2. Empty house? Try virtual furniture.

For in-person open houses it’s not unusual to rent furniture if the home is empty. This makes it much easier for buyers to envision themselves living in the space. Amazingly, you can save money when hosting a virtual open house by inserting computer-generated furniture! Check out Box Brownie online for some examples (but keep in mind that this is for still images, not video).

3. Good lighting.

If you show the house in poor lighting it can make it look like you’re hiding something. Make sure the lighting throughout the house is bright and consistent.

4. Get the word out. 

An amazing virtual open house is pointless if no one sees it, so you need to get the word out. There are lots of places you can promote including Zillow, Facebook, Nextdoor, Craigslist, and even LinkedIn. Your real estate agent or attorney can help you make sure your open house is widely promoted so people will know to attend.

Finally, keep in mind that any time you are buying or selling property, it is important to have an experienced real estate attorney by your side to guide you through the legal complexities of this process. An attorney can protect your best interests and make sure that the sale or purchase is handled in accordance with state and local laws. Atlas Law is here to help with all of your real estate needs. Contact us today.