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Fees and Deposits with regards to Rental/Lease Agreement

  1. A landlord may charge a screening fee solely to cover the costs of obtaining information on the applicant.  The landlord must provide the applicant with a receipt for any such screening fee.
  2. A landlord may not charge non-refundable fees to secure a signing of a rental agreement.
  3. A landlord may charge a deposit to an applicant for the purpose of securing the execution of a rental agreement after the applicant's application has been approved.   If the rental agreement is executed, the landlord shall either apply the deposit toward the moneys due the landlord under the rental agreement or refund it immediately to the tenant/resident.
  4. If the Rental Agreement is not executed due to a failure by the applicant to comply with the agreement to execute, the landlord may retain the deposit.
  5. If the Rental Agreement is not executed due to a failure by the resident to comply with the agreement to execute, then the landlord shall return the deposit to the applicant within four days.

 A landlord may charge a fee more than once, at the beginning of or during the tenancy, for:

  1. A late rent payment
  2. A dishonored check
  3. Removal or tampering with a properly functioning smoke alarm or smoke detector
  4. Any other noncompliance by the tenant with a written rental agreement that provides for a fee for that noncompliance, provided that the fee is not excessive.

Rent to Own and SAFE Act Implications

Question: We just acquired a manufactured home in our community. I would rather sell it to a new tenant, but would consider renting it out or doing a rent-to-own. If I pursue rent-to-own option, will I be subject to the new SAFE Act?

Answer: Remember that the SAFE Act only applies if the seller/landlord is providing financing, and in doing so, is going to make a credit decision regarding the buyer's financial capacity.

In short, so long as you don't extend credit (which includes carrying back a security agreement or other form of installment payment contract) you're not subject to the Act. If you do a credit check for your prospective tenant, this would not be covered by SAFE. Make sure that your lease/option or rent-to-own paperwork is reviewed by legal counsel - and under no circumstances do you want to offer an extension of credit in the transactional documents. Under SAFE, if you extend credit for the purchase of the home you would have to be a Mortgage Loan Originator as described in the Act. I did an extensive summary (FAQs) on the SAFE Act, and you can link directly to it on the MHCO website.

However, on another note, you might want to consider what you are getting into as a landlord of mobile homes. First, you will be responsible for providing certain statutory essential services" which are far more extensive than if you were merely a landlord of the space. Additionally

The Rental Application Form

The Rental Application form provides the basic information needed to make a decision on accepting the applicant. Under current Oregon Law you will have not more than 7 days from application to accept or decline a prospective resident. Used properly, the rental application and personal interview will prove helpful in countering charges of discrimination in renting spaces. When completed, a rental application should reveal:

  • Financial information
  • Employment information
  • Residence history
  • Household members
  • Social security number(s)
  • Driver license number(s)
  • Ownership or lien-holder of the unit
  • Age, size and condition of the unit
  • Information about motor vehicles
  • Pets
  • Age verification if the community is classified as 55 or older or 62 or older housing
  • Credit references
  • Emergency contacts
  • Authorization to do credit and criminal checks
  • Acknowledgement of receipt of disclosure documents

At the time the prospective tenant returns an application for residency, the manager or landlord should provide the prospective tenant with copies of the Statement of Policy, the rent history of the space, the Rental Agreement and the Rules and Regulations. These documents may have been provided earlier in the application packet. You may provide these documents anytime prior to the signing of the rental/lease agreement (ORS 90.510(3)(a). However, make sure that the receipt for receiving these documents is signed prior to signing the rental agreement.

As mentioned earlier, it is advisable to provide the prospective resident these documents with the application so that the prospective resident can make an informed decision regarding where they would like to apply. Take time to make sure the prospective resident is aware of the content of each of these documents. It will do the community or the resident little good to have the prospective resident move in without taking the time to read and understand the Statement of Policy, the rent history of the space, the Rental Agreement and the Rules and Regulations. Poorly informed residents will likely result in future problems in the community. 

Phil Querin Summary/Analysis MHC Sub Metering - 2019 Oregon Legislative Session

 

Over the past two years the Oregon Manufactured Housing Landlord Tenant Coalition reviewed sub metering statutes.  Last year a landlord-tenant work group drafted a number of significant changes to existing statute.  Those changes were adopted into the Landlord Tenant Coalition Bill (SB 586) and passed by the Oregon Legislature.  Attached is a review of those changes by MHCO Attorney Phil Querin.

Phil will be covering these changes during his presentation at the 2019 MHCO Annual Conference.

Phil Querin Q&A: Violations Continue Under 30-Day Notice

Phil Querin

Answer: In theory, you should be able to give a 20-day non-curable notice within the 30 days if the same violation occurs. This is because the law provides that the 20-day notice may be issued if substantially the same violation occurs within six months of the date of issuance of the 30-day notice. A few years ago, the law measured the six month period from the end of the 30-day period. However, the law was changed a few years ago, and it would seem that now you should not have to wait until expiration of the 30-day period before issuing a 20-day notice. Otherwise, after the first 30-day notice, the tenant could speed through the park with impunity for the entire 30 days and the landlord could do nothing until the violation occurred again. This result makes no sense. However, there is a related situation which gives a different result: What if the violation was not an "act" such as speeding, but a "failure to act," such as not maintaining the yard? In that case, if the tenant failed to clean up the yard within the 30-day period, the landlord would be entitled to file for eviction immediately after expiration of the 30 days and would not have to issue a 20-day notice.

Manufactured Homes and Submetering

MHCO

Answer. At first blush this appears to be an issue involving "hazard trees" under ORS 90.100(21). A "hazard tree" is one that:

  1. Is located on a rented space in a manufactured dwelling park;

  2. Measures at least eight inches DBH;[1] and

  3. Is considered, by an arborist licensed as a landscape construction professional pursuant to ORS 671.560(Issuance of license) and certified by the International Society of Arboriculture, to pose an unreasonable risk of causing serious physical harm or damage to individuals or property in the near future.

Regarding hazard trees, ORS 90.727(3) (Maintenance of trees in rented spaces) provides that a landlord:

(a) Shall maintain a tree that is a hazard tree that was not planted by the current tenant, on a rented space in a manufactured dwelling park if the landlord knows or should know that the tree is a hazard tree.

(b) May maintain a tree on the rented space to prevent the tree from becoming a hazard tree, after providing the tenant with reasonable written notice and a reasonable opportunity to maintain the tree;

(c) Has discretion to decide whether the appropriate maintenance is removal or trimming of the hazard tree; and

(d) Is not responsible for maintaining a tree that is not a hazard tree or for maintaining any tree for aesthetic purposes.

Additionally ORS 90.740(4) provides that a rented space is considered uninhabitable if the landlord does not maintain a hazard tree as required by ORS 90.727 (Maintenance of trees in rented spaces).

When the hazard tree legislation was enacted, as best as I can remember, all of us involved in the drafting were looking up, not down. That is to say, we were focusing on large limbs falling on homes, or trees becoming top-heavy from a lack pruning and trimming, and falling over entirely. I do not recall any discussion about the root systems of trees causing dangerous conditions.

However, clearly, if the root system of a tree meeting the definition of a "hazard tree" causes walkways to buckle, it can create a danger to the residents and others using them. Accordingly, under a pretty clear reading of the above-cited statutes, this appears to be a landlord issue that needs to be addressed. As between a resident who does not own the space or the common area walkways, and the landlord who does - and who presumably has the means and insurance to protect against the risk - the financial responsibility rests on the latter. It is a cost of doing business.

However, what if the tree does not meet the definition of a "hazard tree," is located on the resident's space, but has a root system that is encroaching up into common area walkways causing damage? That is a more difficult issue. I say this because if it isn'ta hazard tree, say by girth, then the resident has the trimming and pruning responsibility. But as to that portion of the root system encroaching into the common area, I believe that is the landlord's responsibility. Certainly, the problem did not result from a lack of resident maintenance.

My conclusion is this: The landlord should want the common area walkways safe. If this means cutting out the offending root system, the landlord should do so. Why, because if a resident or their guest falls and injures themselves on a broken walkway, you can be sure the landlord will be sued. Again, it's a cost of doing business, and presumably the reason why smart landlords have good liability insurance.




[1] "Diameter at breast height" i.e. 4.5 feet. See: http://www.phytosphere.com/treeord/measuringdbh.htm

Comparison of Current Law to Compromise Legislation - (Community Sale Notification Process - Removal of "Right of First Refusal" Language from Current Statute)

Current Oregon law (adopted in 1989) already requires manufactured home park landlords/owners to notify park residents prior to a sale to another owner and to negotiate a possible sale to the residents. ORS 90.760, 90.800 to 90.840. Unfortunately, both landlord and tenant advocates recognize that the current law is seriously flawed and doesn't work for either side. HB 4038A fixes those problems.1.Under current law, it is unclear whether and to whom an owner must give notice of the owner's interest in selling the park, or what that notice must say.a. ORS 90.760 allows an undefined tenants association to give notice to the owner of its interest in buying the park before the owner indicates an interest in selling. Apparently, this notice is good forever, even if the tenants die/move or if there is a different owner. No-one keeps track of these notices. And tenants generally do not think about buying their park until there is some indication that the owner wants to sell, so they don't give the advance notice to the owner.b. ORS 90.810 appears to require notice from the owner even if the tenants have not previously notified the owner of their interest in purchasing the park.HB 4038A amends the law to require an owner to give notice to all tenants, without advance registration, or, if there is an active tenant group with which the owner has met during the past 12 months, to that group only, whenever the owner is interested in selling or has received an offer to buy which the owner is considering. And it defines what must be in the notice. And it requires that a copy go to the Oregon Housing & Community Services Department. And it provides a safe harbor for minor errors in giving the notice. Sections 1, 3(3).2. Under current law, owners are required to negotiate in good faith with the tenants and to give the tenants a 14 day right of first refusal to buy the park. ORS 90.820. a. This duty is completely open-ended, with no time limit on the duty or on the owner's duty to negotiate. b. Owners strongly dislike the concept of a right of first refusal. On the other hand, tenants think that 14 days isn't enough time. c. There is no provision regarding what financial information an owner must share with the tenants in the negotiations. d. There is no provision making shared financial information confidential, and no provision providing a remedy to owners if tenants violate a confidentiality duty. e. There is no provision regarding what steps the tenants must take in the negotiation. f. This duty would apply to an owner even if the owner has a time-sensitive offer from another buyer. g. Good faith" is not the right duty to apply in a commercial real estate transaction.The proposed legislation (HB 4038A) removes the right of first refusal language

Increasing Late Fees

Question: A landlord currently charges a $25 late fee. She wants to increase it to $50. Can she do that and if so, what kind of notice should she give? Also, can she change the late fee from a flat amount to a percentage (e.g. 10%) of rent? Answer: Here is a summary of ORS 90.260, the late fee statute. It answers the questions posed above. (1) A landlord may impose a late charge or fee, however designated, only if: • The rent payment is not received by the fourth day of the period for which rent is payable; and • There exists a written rental agreement that specifies: o The tenant’s obligation to pay a late charge; o The type and amount of the late charge; and o The date on which rent payments are due, and the date on which late charges become due. (2) The amount of any late charge may not exceed: • A reasonable flat amount, charged once per rental period. “Reasonable amount” means the customary amount charged by landlords for that rental market; • A reasonable amount, charged on a per-day basis, beginning on the fifth day of the rental period for which rent is delinquent. This daily charge may accrue every day thereafter until the rent (not including any late charge), is paid in full, through that rental period only. The per-day charge may not exceed six percent of the amount of the “reasonable lat amount”, described above; or • Five percent of the periodic rent payment amount, charged once for each succeeding five-day period, or portion thereof, for which the rent payment is delinquent, beginning on the fifth day of that rental period and continuing until that rent payment (not including any late charge), is paid in full, through that rental period only. (3) In periodic tenancies (e.g. month-to-month), a landlord may change the type or amount of late charge by giving 30 days’ written notice to the tenant. (4) A landlord may not deduct a previously imposed late charge from a current or subsequent rental period rent payment in order to make the rent payment short so as to issue a 72-hour notice of nonpayment. (5) A landlord may charge simple interest on an unpaid late charge at the rate allowed for judgments (9.00%) and accruing from the date the late charge is imposed. (6) Nonpayment of a late charge alone is not grounds for termination of a rental agreement for nonpayment of rent, but is grounds for termination of a rental agreement for cause by using a curable 30-day written notice of termination.

Evicting “Vacation Occupants” from RV Park

Mark L. Busch

By:  Mark L. Busch, P.C., Attorney at Law

This article is informational only and is not intended as legal advice.  Always consult with a competent attorney before undertaking any legal action.

Question: We have a person on a vacation occupancy agreement in our RV park (MHCO Form 202).  The end date for the agreement is coming up, but this person says he is not going to move out with his RV and wants us to give him a regular rental agreement.  We don’t want him as a long-term tenant based on his behavior (dog loose, messy RV space, etc.).  Do we have to offer him a rental agreement?  How do we get him out if he refuses to leave?

 

Answer: You do not have to offer him a rental agreement.  Since you indicate that he has signed the MHCO vacation occupancy agreement, presumably he qualifies as a vacation occupant.  Under Oregon law (ORS 90.110 (7)), vacation occupants are not tenants and are not entitled to be offered a rental agreement. 

 

As per ORS 90.100 (54), “vacation occupancy” is defined as: (1) The occupant is renting the RV space for vacation purposes only, not as a principal residence, (2) the occupant has a principal residence other than at the space, (3) the period of occupancy cannot exceed 90 days, (4) the RV must be removed from the park at the end of the occupancy period, and (5) a written agreement signed by the occupant states that occupancy of the space in the RV park is a vacation occupancy and is NOT subject to the Oregon Residential Landlord and Tenant Act (ORS Chapter 90).

 

Since vacation occupants are not “tenants,” they may be asked to vacate at any time without issuing an eviction notice or going to court.  If necessary, law enforcement may be called to remove vacation occupants as trespassers if they refuse to leave.  In that case, you must have a copy of the written vacation occupancy agreement available to show the responding officers that the occupants are not tenants under Oregon law and can be cited for trespassing.  They are effectively the same as a hotel guest that refuses to leave.

 

If, for some reason, law enforcement refuses to remove a vacation occupant, you might need to file an eviction case in your county circuit court.  Be sure not to accept payment from the person for any period of time after the 90-day occupancy period or it could create a tenancy.  You will need to file an eviction case for a “tenancy not covered by ORS Chapter 90.”  The court clerk should have a complaint form that you can use, or consult with an attorney to file the case.

 

 

Mark L. Busch, P.C., Attorney at Law, Cornell West, Suite 200, 1500 NW Bethany Blvd., Beaverton, Oregon 97006; Phone: 503-597-1309; Web:  www.marklbusch.com