Selling with Vacant Possession - but people stay in house ?

[Bluekiwi]

Okay what happens when you sell with vacant possesion and then the people in the house decide not to leave.

I am just considering the possibility in case this happens to me.

I have a mortgage sale property, which they use as a church and have someone stay in one room.

They want to buy it back from me, which could still happen, but it it doesnt.

And I have an auction lined up if they cant, well fine if they move.

But what if they decide not to go.
And on possesion date the buyer cant get access.

How does that work re the S&P and cost to me ?????

[Ivan McIntosh]

Not quite clear, but you are saying that you are selling it back to the church tenant? And it's their person staying in one room?

If so, just include a clause in the special conditions making that person their problem. They shouldn't have a problem with it.

If the person living in a room is your doing and nothing to do with the auction purchaser, and the tenant refuses to move, you will be in default and paying penalty interest until you can offer vacant possession. It's not the purchaser's problem if you offer them vacant possession and then don't deliver; it's your problem.

Again, however, you can try to get away with a "best endeavours to get tenant out" clause when setting up the auction agreement...but could have a very detrimental effect on offers.

[Bulldog]

Mortgagees rarely (if ever!) offer vacant possession, you will be doing extremely well if you can get a S&P agreement with special clauses.

[Bluekiwi]

Not quite clear, but you are saying that you are selling it back to the church tenant? And it's their person staying in one room?

If so, just include a clause in the special conditions making that person their problem. They shouldn't have a problem with it.

If the person living in a room is your doing and nothing to do with the auction purchaser, and the tenant refuses to move, you will be in default and paying penalty interest until you can offer vacant possession. It's not the purchaser's problem if you offer them vacant possession and then don't deliver; it's your problem.

Again, however, you can try to get away with a "best endeavours to get tenant out" clause when setting up the auction agreement...but could have a very detrimental effect on offers.

Sorry I didnt make it clear.

If I dont sell to the old owner, who is the related to the person staying there.
Then I will go to auction.

But I see, I pay penalty interest.
So maybe keep that to a low rate in the auction docs as a precaution.

[Bluekiwi]

Mortgagees rarely (if ever!) offer vacant possession, you will be doing extremely well if you can get a S&P agreement with special clauses.

na I bought on mortgage conditions, and selling under normal, yahoo

[Ivan McIntosh]

Sorry I didnt make it clear.

If I dont sell to the old owner, who is the related to the person staying there.
Then I will go to auction.

But I see, I pay penalty interest.
So maybe keep that to a low rate in the auction docs as a precaution.

Good idea. Of course, that works both ways so you don't get much PI if the purchaser defaults. But as long as it is enough to cover your mortgage and bulding costs perhaps it won't be too much an issue.

I don't have any recent experience with evicting people that won't leave, so can't give you any idea of how long it would take, sorry. Maybe some others on the forum have had to remove someone recently?

[WGN ex-property manager]

Best to get the person staying there on a $1 pw tenancy agreement, with a $1 bond, so you can go to Tenancy Tribunal if you have to.

This will mean you'll need 42 (+ a few to server the notice) days between auction and settlement date to give the tenant the legally required notice.

[essence]

Does the occupant have a tenancy agreement with you?? Have they been paying rent IN FULL AND ON TIME. If not, go to TT for termination of tenancy. If yes, give them 42 days Notice to vacate as you are selling the property.

If the occupant doesn't have a tenancy agreement and hasn't been paying any rent, issue them with a Trespass Order. They are squatting in your property.

In the majority of mortgagee sales, the mortgagor does not offer the property with vacant possession as you have found out. Therefore the purchaser has to remove the occupant. Sometimes this can be very messy.

I would suggest that you contact the church(?) and explain to them "The occupant will be leaving one way or other. Maybe it would be a good opportunity for them to leave prior to the property going to auction. This way they can leave on their time frame into a house of their choice. If they decide to stay, well they may only get 24 hours notice to move".

Be reasonable, negotiate BUT BE FIRM.

Good luck and let us know how you get on.

[devidfox]

So it is always best to ask the occupant to move out before selling the property in order to avoid a messy situation?

[eri]

if you want to sell it as vacant

[Keys]

Squatters. They got possession of the property from someone, somehow.
Trespassers. They moved in.

Squatters can be dealt with by using the RTA.
Trespassers can be dealt with by using the Police.

[Bluekiwi]

I have moved people on before the hard way, but it takes police and court order, and "Time".

These people are not the trouble I had before.
But I just wanted to find out now how it all works.

As this time I am selling something with vacant possession, and potentially could have a problem with occupation of the house.

Whereas last time I bought a mortgage auction with no vacant possesion and had to evict them.

[Bluekiwi]

Squatters. They got possession of the property from someone, somehow.
Trespassers. They moved in.

Squatters can be dealt with by using the RTA.
Trespassers can be dealt with by using the Police.

Okay.
When I bought the place in Jan via mortgage sale.
They were there, and they are still there now.
They want to buy it back from me but are struggling on finance, surprise surprise, but my broker is having a go for them.

So Quatter ??

Certainly not tenant, so dont think RTA comes into it.
And not tresspassers as they didnt move in.

But squatter = RTA.

So whats your answer to that equation Glen

[Bluekiwi]

Best to get the person staying there on a $1 pw tenancy agreement, with a $1 bond, so you can go to Tenancy Tribunal if you have to.

This will mean you'll need 42 (+ a few to server the notice) days between auction and settlement date to give the tenant the legally required notice.

Is this a little trick to get them uder the RTA which is easier enforce than getting a court order to evict.

So perhaps I set up tenancy now, then terminate it 2 weeks latter.
Then just before settlement of the new buyer 4 weeks after 9/3 auction date.
I can enforce it.

Getting a court order for recovery of land through the courts can take months and cost money.
So if it comes to that I would be hammered from both ends.
so I need to sort out a plan.

I am meeting them on Monday to have a chat.

[Dean@Massiveaction]

A long piece of 4 by 2 and a 6 inch nail may help :-)