Signed Lease, Tenant Denied Utility Service

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goldenboy623

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My jurisdiction is: Pennsylvania

Potential tenant signed lease for a rental house and I received $500 non-refundable deposit. Prior to move-in May 1, I contacted the local gas/electric utility company to drop my utility service in my name on the rental house. Utility company proceeds to tell me that they denied service to my potential tenant. Tenant has not been given keys to rental property and not moved in. What can I do to get out of the lease since it is obvious they have financial issues?

Note: Potential tenant called my cell and left a message saying they will meet with call me later this week and arrange to pick up keys. Phone calls to tenant have not been returned.
 
Tenant cannot live there without utilities so lease is breached somewhat. Why not offer to pay these in exchange for higher rent? You might also consult an Attorney familar with Tenant/Landlord issues to see what your legal options are as well. Wait for "Gail in Georgia" to reply to this thread as she is very wise in these issues
 
Thank you jacksgal.

I agree with the suggestion that you might consider keeping the utilities in your name and charging a higher rent to cover this.

The issue of your current utility company denying service to your potential tenant may not be because of previous financial problems with them. I had a young army couple be denied an account with one of our local gas suppliers because they had moved from another state (one not covered by this supplier) and thus had no history with them. Luckily we have several different suppliers in our region and they were able to set up an account with another company.

Did the utility company give you a reason why they were denying the new tenants an account?

Gail
 
Reply to Gail in Georgia

The utility company gave me the impression it was a financial issue. If that is the case, I would not increase their rent to cover the utilities. At this point I am concerned that they will have problems paying the rent on time or at all. What would you recommend that I do to notify them that I am terminating the lease? Any other suggestions?
 
When you meet with them you ask them how they are going to handle the issue of getting the utilities turned on in their name. Perhaps they have a co-signer who can have it turned on for them.

What is taking place is not evidence that they will not pay their rent on time nor a legal reason for you to terminate the lease on the assumption that they won't pay their rent to you. Did you do a credit check when they applied for the rental and before you approved them as tenants by signing a lease with them?

Gail
 
Reply to Gail

No, I did not do a credit check which was my mistake. It late now but which agencies should I have considered for a credit check?
 
jacksgal said:
Credit checks are a must if your going to rent.
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I disagree. Credit checks can be an indication of financial responsibility but not always. People from foreign countries and young adults often have no credit, and some people can have bad credit due to misfortune. The best indicator for responsible tenancy is references, both employment and previous tenancy.
 
There are many sources that a landlord should use when evaluating a potential tenant. The credit check can be used to determine past judgements and a history of failing to pay creditors. Confirming income through employment checks, confirming the past history of paying rent though previous landlord checks can also be used when evaluating an applicant.

Gail
 
The credit check can be used to determine past judgments and a history of failing to pay creditors.
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Of course you're right. My concern is that people may not realize that bad credit does not entail bad tenancy, as people can have bad credit for many reasons unrelated to their ability to pay rent on time.

As a side note, I also think that our culture of credit has encroached too far into what we consider valuable. All that glitters is not gold, as they say. Or, to modernize the expression, St. Peter doesn't check FICO scores.
 
St. Peter also isn't a landlord.

My eldest son was, in his younger days, rather "casual" about paying his bills. Unfortunately to him all that glitters was gold and he just had to have it right that minute. Never bothered to listen to mom and dad when we tried to impress that this would have far reaching implications down the road. He's finding this out now.

Applicants need to be honest if they know their credit reports are going to contain red flags. If there are legitimate reasons for these it is far better to discuss them with the landlord before the landlord runs the report.

Gail
 
Yes Gail. I am always upfront with potential landlords. My ex husband caused untold damages to my credit score. He was evicted from our home in Carroll County but luckily enough the Landlord knew I had left and did not hold me responsible for anything. I have excellent rental and job references. Have been in the same industry for 15 years. So far they have been very nice and understanding about the damage he inflicted. I am fighting everything from Collection Agencies to BOA!
 
s_fitz said:
I disagree. Credit checks can be an indication of financial responsibility but not always. People from foreign countries and young adults often have no credit, and some people can have bad credit due to misfortune. The best indicator for responsible tenancy is references, both employment and previous tenancy.
Click to expand...

100% right! I do not have the world greatest credit but that was due to identity theft! Doing a credit check on me is useless. Now what you should have done was do a reference check, previous landlords, employers and so on...
 
On the reference check, make sure you go back 2 or 3 landlords if possible, as I have had the last landlord tell me the tenant was a great on time payer only to find out the opposite and they were just trying to get rid of them.
 
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