By Patricia A. Kieck, Esq.
Are you selling or purchasing a two family with tenants in occupancy or a single family home with a tenant in occupancy?
Whether you are the seller or purchaser, you need to know whether or not the home is a legal two-family. There have been occasions when an individual lists the property as a two family, but the property is not zoned two family or the home was not legally converted
In a two-family home, is it owner occupied or not? Is there a written or verbal lease? Is it a month to month term or an annual term. If you are purchasing, do you intend to live there or not. Different rules apply.
The Just Cause for Eviction Act applies to non-owner occupied two-family and single family rented premises. It sets forth the requirements needed to permit a seller/owner to have a tenant removed from a non-owner occupied premise so long as the contract is properly drafted.
The Seller sends the notice to the tenant. The seller generally does not want to give that notice until he/she is certain that the purchaser has a written mortgage commitment. Determining the closing date should take this factor into consideration.
What happens if the tenant does not vacate? The Seller should be responsible for removing the tenant. An eviction action would have to be filed. In most instances the Seller would obtain a judgment for possession and have the tenant removed. However, the Just Cause for Eviction Act provides that a tenant may obtain a hardship stay of the eviction for a maximum of six months. Such an occurrence could be detrimental to the parties. What happens in such an event should be negotiated during the attorney review period.
In the circumstance where the premises are owner-occupied, then the owner can evict a tenant for any reason or no reason However, the notice must be in writing. If there is a written lease with an annual term, the tenant could not be ordered to vacate prior to the expiration of the lease term.
Sometimes, the purchaser intends on keeping the tenant. In that situation, the purchaser should review the lease agreement to be sure the terms are acceptable to him/her. You want to be sure that the tenant is not in default of their lease or the rent payments.
A seller or purchaser should make themselves aware of any municipal requirements such as, registration as rental property, rent control; the Security Deposit Act (N.J.S.A. 46:8-19): the Leasehold Act (N.J.S.A. 46:8-1 et seq. ) and the Just Cause for Eviction Act. N.J.S.A. 2A:18-53 et seq.
This article is for information only and is in no way a substitute for legal advise from an attorney.