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I'm LLC of a 15 unit apartment building since 2020, my late uncle purchased it in 2008, with 4 tenants from 1998.
2 of those 4 tenants are still here (2024). Do I have to honor their original lease agreement when we bought the building in 2008?
For we wish to impose a late fee against their current monthly rent 'at 0.6%', instead the $25 listed on their 1998 lease agreement. Am I not being non compliant and against renters rights/
TY
To determine whether you must honor the original lease agreements and if you can impose a new late fee, you should consider several factors, including the terms of the lease, state and local landlord-tenant laws, and any potential rent control or tenant protection regulations. Here's a breakdown:
1. Existing Lease Agreements
Lease Continuity: When you acquired the building in 2008, the leases that were in place for tenants typically transferred to you as the new landlord. This means you were obligated to honor the terms of those leases until they expired or were replaced with new agreements.
Renewals or Month-to-Month Agreements: If those tenants have not signed a new lease since 1998 and are now on a month-to-month agreement, the terms of their original lease might still apply, depending on state law.
2. Changes to Lease Terms
Modifications: You generally cannot unilaterally change the terms of a lease agreement during its term. For tenants who are now on month-to-month agreements, you may be able to adjust terms with proper notice. The required notice period and conditions for changes depend on your state laws.
Late Fees: If their original lease specifies a $25 late fee, that remains binding unless a new lease or amendment is signed, or unless your state's laws allow changes to month-to-month agreements with proper notice.
3. State and Local Laws
Rent Control or Tenant Protections: Some jurisdictions have laws limiting late fees, requiring them to be "reasonable," or capping the amount as a percentage of the rent. Make sure your proposed 0.6% late fee complies with these regulations.
Notice Requirements: If your state allows you to impose new terms for month-to-month tenants, you must give them proper notice, typically 30 or 60 days, depending on local law.
4. Potential Noncompliance
Unilateral Changes: Imposing a new late fee without amending the lease or providing the required notice could be considered a violation of the lease and local landlord-tenant laws.
Retaliation or Harassment: Ensure that changes are not perceived as retaliatory, especially for long-term tenants with significant protections under local laws.
5. Next Steps
Review the Original Lease: Confirm whether the tenants are still operating under the original lease or if they are now month-to-month. If they signed a new lease after 1998, that agreement governs.
Check State and Local Laws: Understand the rules for modifying lease terms and imposing late fees.
Communicate Clearly: If you can legally adjust the late fee, provide written notice with the required lead time, explaining the changes.
Consulting a local attorney or property management professional familiar with landlord-tenant laws in your area is highly recommended to ensure compliance.
- This answer was written by AI (ChatGPT) and reviewed by the ezLandlordForms team.
