[quote=ElisabethinCA]I was thinking the same thing. I know this is a really old post, but I could not believe the arrogance that he/she states he had at one time “10 properties in foreclosure” yet he sued 2 tenants for moving and not paying the rent. Like they were the bad ones. What a pig. You made a contract to pay the mortgage on all the properties you purchased, yet you just stopped paying, kept collecting rent from your tenants, expect the taxpayers to clean up your financial mess and your tenants to “just deal with it”. People like you deserve everything bad that happens in life. You are the kind of people this country doesn’t need. I would rather keep the illegals that come here to work hard and make a living for their families, then people like you who take advantage at every turn and use the system. I am in CA and have a landlord that did the same thing. I wouldn’t have to move and incur the expenses of moving while dealing with an illness I have had for 2 years had they paid the mortgage with the rent I gave them. I stopped paying the rent. I would literally be living in my car while they took my rent and bought food and paid their bills, except the mortgage. Take me to court. Go ahead. I will sue for moving expenses, stress, medical bills, and everything I can think of. I was a great tenant for 5 years. This is the 2nd time they stopped paying the mortgage. It isn’t just tenants that are bad. Landlords are just as bad and worse sometimes.[/quote]
Ethically, I am not fond of collecting rent and not paying mortgage.
However, it is not illegal per se.
Collecting rent when you don’t own it (like after the repo) is rent skimming.
Collecting and not paying in the first 12 months of ownership is rent skimming.
However, the rent contract and the mortgage contract are separate.
If I have a work contract with my boss and a credit card contract with my bank, it is not okay for the boss to stop paying me because I am behind on my credit card (even if cc non-payment will likely result in a wage garnishment down the road).
Same logic applies here.
I briefly managed a rental for a client and he stopped paying.
I thought this might happen and so I kept the tenant’s deposit in my trust account.
When the repo happened, I gave the tenant back their deposit and the bank gave them 120 days free and a couple thousand for moving without damaging the place.
I was not happy about this but I was upfront from the beginning with the tenant and I treated them fairly from the beginning.
They came out ahead in the end.
Also, banks often advise borrowers to not pay if they are in the middle of a modification.
