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Discussion Starter · #1 ·
<p>Instead of selling our old house we kept it as a rental property-- we have no mortgage on it and figured it was not a good time to sell.  We found some tenants whom we liked, they moved in and have been great.  They pay on time and have done a lot of repairs to the house, and finished a storage room in the basement into a "bedroom" for one of their teenagers.  I was uneasy about this since I didn't feel, from a safety perspective, it was a good idea to have someone sleeping in the basement, but the girl was thrilled with the "bedroom" so we turned a blind eye.</p>
<p> </p>
<p>About two months ago they asked if a relative could stay there temporarily.  We said sure.  However, when we went last night we  saw it was not just this relative but her toddler daughter, possibly her husband (a man I didn't recognize came up the stairs) and what looked like an entire apartment of stuff packed into the basement.  The basement is unfinished (except for the "bedroom")-- cracked concrete floor, no heat except what emanates from the furnace-- it is barely a place for a willing teenager and definitely is not suitable for a family.  The "bedroom" is maybe 10 feet by 6 feet.</p>
<p> </p>
<p>So I figure we have the following options-- 1) turn a blind eye again; 2) try to finish the whole basement (which we couldn't start for at least 6 months due finances), 3) tell the tenants they can't have more than one person sleeping down there.  If I go with "3" I'm concerned they'll just try to hide the people living there by having them go somewhere else when we collect the rent.  I also don't want to turn anyone out on the street.</p>
<p> </p>
<p>We have put smoke and CM detectors throughout the house, also fire extinguishers.  There is only one exit from the basement other than small windows I'm not sure an adult could fit through.  Any thoughts?</p>
 

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<p>#3,  I would be totally freaked out too.  It's clearly illegal due to lack of egress and god forbid there is a fire and someone is injured - your family could be DESTROYED by an ensuing lawsuit.  They won't be able to "hide" the people's stuff when you collect rent.  I think I'd stop turning a blind eye and let them know it's not OK for the space to be used as a bedroom.   You can do this in a nice way and let them know that you're very worried about your own liability if it continues.  I feel you on not wanting to put people on the street but it's not fair to your family for them to put you in this position (of asking them to get the people out).  You did them a favor by allowing them to "get" an additional bedroom out of the space without an increase in rent, and they are taking advantage of this - even if they are doing so to help a family in need.</p>
 

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<p> Have you looked into occupancy laws? If there is a fire, etc your insurance may not cover the damage. I would not risk it.</p>
 

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<p>first, transfer ownership of the house to an LLC (which you own 100%) .... many real estate investors have one llc per property. that way the worst case scenario is that they lose <strong>one</strong> house in a lawsuit.</p>
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<p>next, notify the tenants in writing that the basement is not a sleeping area. you might get expert advice (not me!) about this. inspection (or not) is up to you. i might notify but not inspect more than once, or not inspect.</p>
<p> </p>
<p>your local area may have occupancy laws about how many "unrelateds" can be in a house. find out what they are and enforce them.</p>
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<p>in the longer term, you could have a basement egress window installed. <a class="H-lightbox-open" href="http://www.mothering.com/community/content/type/61/id/456828/width/1000/height/800/flags/" target="_blank"><img alt="Basement-egress-Window.jpg" class="lightbox-enabled" data-id="16635" data-type="61" src="http://www.mothering.com/community/content/type/61/id/16635/width/224/height/168" style="; width: 224px; height: 168px"></a></p>
<p>...if they would agree to increased rent.</p>
<p> </p>
<p>first, start with protecting your family and get the llc.</p>
 

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<p>I would go with #3, but be sure to notify them in writing via registered mail and send yourself a copy at the same time in a postmarked envelope and don't open it. It might provide you some protection if something did happen as you would have informed them it's not okay. I don't think not telling them is really an option - if they choose to hide the people, that's sort of their issue.</p>
 

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<p>If you go with #2, the rent needs to go up. They need to eat the cost of this, not you.</p>
 

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<p>for starters, i probably would have assumed they had guests and not that everyone was living there.  If you are that concerned why dont you just ask?</p>
<p> </p>
<p>second i would make it clear that noone besides the person you authorized can "live" down there, and I would finish the space and increase the rent.  </p>
<p> </p>
 

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<br><br><div class="quote-container"><span>Quote:</span>
<div class="quote-block">Originally Posted by <strong>SleeplessMommy</strong> <a href="/community/forum/thread/1283474/concerns-about-tenants#post_16092694"><img alt="View Post" class="inlineimg" src="/community/img/forum/go_quote.gif" style="border:0px solid;"></a><br><br><p>first, transfer ownership of the house to an LLC (which you own 100%) .... many real estate investors have one llc per property. that way the worst case scenario is that they lose <strong>one</strong> house in a lawsuit.</p>
<p> </p>
<p>next, notify the tenants in writing that the basement is not a sleeping area. you might get expert advice (not me!) about this. inspection (or not) is up to you. i might notify but not inspect more than once, or not inspect.</p>
<p> </p>
<p>your local area may have occupancy laws about how many "unrelateds" can be in a house. find out what they are and enforce them.</p>
<p> </p>
<p>in the longer term, you could have a basement egress window installed. <a class="H-lightbox-open" href="http://www.mothering.com/community/content/type/61/id/456828/width/1000/height/800/flags/" target="_blank"><img alt="Basement-egress-Window.jpg" class="lightbox-enabled" data-id="16635" data-type="61" src="http://www.mothering.com/community/content/type/61/id/16635/width/224/height/168" style="; width: 224px; height: 168px"></a></p>
<p>...if they would agree to increased rent.</p>
<p> </p>
<p>first, start with protecting your family and get the llc.</p>
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<br><br><p>YES, YES, YES, YES, YES to this.  And beyond unrelateds, find out the number of people (usually adults) per bathroom allowed in the building and the legalities of sleeping in the basement even if only one person is living there.  Even with proper egress, there are laws around setbacks from the mechanicals (hot water heater, furnace, etc.) and sleeping in the same areas as mechanicals.</p>
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<p>You can get expert advice on all of this through your local building code department and department of health.</p>
<p> </p>
<p>And you'll NEED to find out about it because you now have a finished area in your basement that was done without permit.  It might be totally fine, but find out about the setbacks from the mechanicals because when you finally DO sell the house, that could end the deal unless you remove everything that was done.</p>
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<p>That's above and beyond potential fines for local illegal housing laws.</p>
<br><br><div class="quote-container"><span>Quote:</span>
<div class="quote-block">Originally Posted by <strong>surrogate</strong> <a href="/community/forum/thread/1283474/concerns-about-tenants#post_16094266"><img alt="View Post" class="inlineimg" src="/community/img/forum/go_quote.gif" style="border:0px solid;"></a><br><br><p>for starters, i probably would have assumed they had guests and not that everyone was living there.  If you are that concerned why dont you just ask?</p>
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<p>second i would make it clear that noone besides the person you authorized can "live" down there, and I would finish the space and increase the rent.  </p>
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<br><br><p>As a landlord, it's not exactly wise to assume the best.  And even if you ask, you can't assume they're answering truthfully.  You'd still CYA with the letter outlining the laws.  No offense, but to assume they're just guests when there's a new apartment's-worth of stuff stored in the basement is kind of naive.</p>
 

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<p>No way. If nothing else, I would not be ok with the wear and tear of two families living in the house. It seems like they're taking advantage of you guys being easygoing landlords. If they asked for a single guest and instead have an additional family living there, that's not cool at all.</p>
<p> </p>
<p>I would absolutely take legal measures to make sure that only the family members you knew of initially are living there. Our lease even states that no guest can stay longer than two weeks. </p>
 

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Discussion Starter · #10 ·
<br><br><div class="quote-container"><span>Quote:</span>
<div class="quote-block">Originally Posted by <strong>sunflower.mama</strong> <a href="/community/forum/thread/1283474/concerns-about-tenants#post_16092582"><img alt="View Post" class="inlineimg" src="/community/img/forum/go_quote.gif" style="border:0px solid;"></a><br><br><p>#3,  I would be totally freaked out too.  It's clearly illegal due to lack of egress and god forbid there is a fire and someone is injured - your family could be DESTROYED by an ensuing lawsuit. </p>
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<p>Obviously this is a concern of mine, however, wouldn't we be liable only for the terms under which the house was rented-- 3 BR, unfinished basement, and only to the people listed on the lease?  Landlords can't control their tenants behavior-- I mean if they were experimenting with bomb equipment and blew up the house, how could we be liable as long as we furnished smoke detectors, etc.<br>
 </p>
<p>Sleepless-- good idea about the LLC, I will have DH do that.</p>
 

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<br><br><div class="quote-container"><span>Quote:</span>
<div class="quote-block">Originally Posted by <strong>frugalmum</strong> <a href="/community/forum/thread/1283474/concerns-about-tenants#post_16095236"><img alt="View Post" class="inlineimg" src="/community/img/forum/go_quote.gif" style="border-bottom:0px solid;border-left:0px solid;border-top:0px solid;border-right:0px solid;"></a><br><br><br><br><div class="quote-container"><span>Quote:</span>
<div class="quote-block">Originally Posted by <strong>sunflower.mama</strong> <a href="/community/forum/thread/1283474/concerns-about-tenants#post_16092582"><img alt="View Post" class="inlineimg" src="/community/img/forum/go_quote.gif" style="border-bottom:0px solid;border-left:0px solid;border-top:0px solid;border-right:0px solid;"></a><br><br><p>#3,  I would be totally freaked out too.  It's clearly illegal due to lack of egress and god forbid there is a fire and someone is injured - your family could be DESTROYED by an ensuing lawsuit. </p>
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<p>Obviously this is a concern of mine, however, wouldn't we be liable only for the terms under which the house was rented-- 3 BR, unfinished basement, and only to the people listed on the lease?  Landlords can't control their tenants behavior-- I mean if they were experimenting with bomb equipment and blew up the house, how could we be liable as long as we furnished smoke detectors, etc.<br>
 </p>
<p>Sleepless-- good idea about the LLC, I will have DH do that.</p>
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<p><br><br>
You become liable when you told them to go ahead and live in the basement.  That was your first mistake.  2nd you allowed the 'relative' to stay at the house but didnt but a time frame on the stay.  Your lease needs to state how long visitors can stay.  The lease should say sometime like 'visitors not on the lease can visit a max of 5 days at a time' and no more than 20 days max a year.  No more than 2 adult visitors at a time.'-  that was just an example.   You should have a standard lease they signed that has all the info written out.  When you decided to rent the property did you meet with a lawyer?</p>
<p>I would also be concered if they were 'modifying' the basement if the construction was done up to code.  Was there a building permit?  If things were done wrong its going to cost YOU money to either fix it or rip it all out and start over.</p>
 

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<p>I get your point about not being liable for bomb-making, etc., but you are absolutely liable for illegal and safe housing, and any construction in the house.  Especially since you witnessed that they finished the space in the basement.  Arguments can be made around the extra people being guests for a day or two that you HAPPENED to be there or the stuff in the basement being theirs; but there's no getting around the fact that you know they finished space in the basement and it's set up like a bedroom.</p>
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<p>Illegal housing is difficult at best.  Back in NJ, there was a landmark case that really dug the grave on cracking down on it: the town had to give 24 hours notice to inspect for illegal housing.  Of course, 99% of the time, that's enough time to empty out the stuff that is a dead giveaway for using space illegally.  But then, if the town can't nail them--the landlord can't be held responsible for it, either.  The issue would be if there was a fire with the insurance company.</p>
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<p>You're going to get nailed for the finished space in the basement one way or another.  You own the property and you are therefore ultimately responsible for it's care.  Period.</p>
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<p>Agreeing that you need to add something about guests into your lease.  We always alter our leases for this.  Of course, we also always managed to get tenants in their 20s, so we were always worried about a boy/girlfriend moving in that we hadn't cleared.  :/</p>
 

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<br><br><div class="quote-container"><span>Quote:</span>
<div class="quote-block">Originally Posted by <strong>frugalmum</strong> <a href="/community/forum/thread/1283474/concerns-about-tenants#post_16095236"><img alt="View Post" class="inlineimg" src="/community/img/forum/go_quote.gif" style="border-bottom:0px solid;border-left:0px solid;border-top:0px solid;border-right:0px solid;"></a><br><br><br><br><div class="quote-container"><span>Quote:</span>
<div class="quote-block">Originally Posted by <strong>sunflower.mama</strong> <a href="/community/forum/thread/1283474/concerns-about-tenants#post_16092582"><img alt="View Post" class="inlineimg" src="/community/img/forum/go_quote.gif" style="border-bottom:0px solid;border-left:0px solid;border-top:0px solid;border-right:0px solid;"></a><br><br><p>#3,  I would be totally freaked out too.  It's clearly illegal due to lack of egress and god forbid there is a fire and someone is injured - your family could be DESTROYED by an ensuing lawsuit. </p>
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<p>Obviously this is a concern of mine, however, wouldn't we be liable only for the terms under which the house was rented-- 3 BR, unfinished basement, and only to the people listed on the lease?  Landlords can't control their tenants behavior-- I mean if they were experimenting with bomb equipment and blew up the house, how could we be liable as long as we furnished smoke detectors, etc.<br>
 </p>
<p>Sleepless-- good idea about the LLC, I will have DH do that.</p>
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<p><br><br>
Funny about bomb making, as this story is on front page of Yahoo right now.</p>
<p><a href="http://news.yahoo.com/s/ap/20101206/ap_on_re_us/us_explosive_house" target="_blank">http://news.yahoo.com/s/ap/20101206/ap_on_re_us/us_explosive_house</a><span style="display:none;"> </span></p>
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<p>Although from this story it doesn't sound like the home owners are liable for the cost of the house being blown up and the resulting governemtn oversight, they will not be reimbursed for the destruction of their rental house as it's been deemed a public nusicance. So the property owners are out a house with most likely no recourse. They won't be able to go after the tenat, as he's most likely going to be in jail for a long time.</p>
 

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<div class="quote-container">
<div class="quote-block"><br><br><div class="quote-container"><span>Quote:</span>
<div class="quote-block">Originally Posted by <strong>surrogate</strong> <a href="/community/forum/thread/1283474/concerns-about-tenants#post_16094266"><img alt="View Post" class="inlineimg" src="/community/img/forum/go_quote.gif" style="border:0px solid;"></a><br><br><p>for starters, i probably would have assumed they had guests and not that everyone was living there.  If you are that concerned why dont you just ask?</p>
<p> </p>
<p>second i would make it clear that noone besides the person you authorized can "live" down there, and I would finish the space and increase the rent.  </p>
<p> </p>
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<br><br><p>As a landlord, it's not exactly wise to assume the best.  And even if you ask, you can't assume they're answering truthfully.  You'd still CYA with the letter outlining the laws.  No offense, but to assume they're just guests when there's a new apartment's-worth of stuff <strong>stored</strong> in the basement is kind of naive.</p>
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<p>Keyword is stored, i always assumed people used basements FOR storage.  Then again I live in an area with no basements...so IDK.  I rent, and I would be mortified if my landlord told me how many adults i could have visit at a time and for how long...woah...<br>
 </p>
 

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<br><br><div class="quote-container"><span>Quote:</span>
<div class="quote-block">Originally Posted by <strong>surrogate</strong> <a href="/community/forum/thread/1283474/concerns-about-tenants#post_16096735"><img alt="View Post" class="inlineimg" src="/community/img/forum/go_quote.gif" style="border:0px solid;"></a><br><br><div class="quote-container">
<div class="quote-block"><br><br><div class="quote-container"><span>Quote:</span>
<div class="quote-block">Originally Posted by <strong>surrogate</strong> <a href="/community/forum/thread/1283474/concerns-about-tenants#post_16094266"><img alt="View Post" class="inlineimg" src="/community/img/forum/go_quote.gif" style="border:0px solid;"></a><br><br><p>for starters, i probably would have assumed they had guests and not that everyone was living there.  If you are that concerned why dont you just ask?</p>
<p> </p>
<p>second i would make it clear that noone besides the person you authorized can "live" down there, and I would finish the space and increase the rent.  </p>
<p> </p>
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<br><br><p>As a landlord, it's not exactly wise to assume the best.  And even if you ask, you can't assume they're answering truthfully.  You'd still CYA with the letter outlining the laws.  No offense, but to assume they're just guests when there's a new apartment's-worth of stuff <strong>stored</strong> in the basement is kind of naive.</p>
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<p>Keyword is stored, i always assumed people used basements FOR storage.  Then again I live in an area with no basements...so IDK.  I rent, and I would be mortified if my landlord told me how many adults i could have visit at a time and for how long...woah...<br>
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<br><br><p>Really? I have never signed a lease that DIDN'T stipulate how many people could occupy the house on a permanent basis, and how many guests could be there and for how long. If someone is there for weeks or months, they're not really a guest, kwim? They're basically additional tenants. </p>
 

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<br><br><div class="quote-container"><span>Quote:</span>
<div class="quote-block">Origin
<p>Keyword is stored, i always assumed people used basements FOR storage.  Then again I live in an area with no basements...so IDK.  I rent, and I would be mortified if my landlord told me how many adults i could have visit at a time and for how long...woah...<br>
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Why would you be mortified? It's a part of many standard leases including my own. Yes, we can have guests for limited time, but only the 2 of us are legally allowed to live there and it states as such on our lease.</p>
<p>Just like my lease also states that we can not have illegal drugs on the premise, and if we did and were "caught" we could be evicted.</p>
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<p>Landlords absoultely can "try" to control their tenants use of the property.</p>
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<p>OP - how much longer does your current lease on the property have? If you are month to month already, I would absoultely draw up a better contract and present to tenants. If they can not meet your terms, then time to look for new renters.</p>
<p> </p>
<p>best</p>
 

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<p>Some states (maybe all) have a max number of people based on number of rooms. THAT maybe something you should check into as well.  I would not be comfortable with this kind of situation.  I would check into the laws regarding land lords and inspections. You probably have to submit a notice 24hrs and then go in and do an inspection- that way you've got a base of what the house looks like (with them there) how many people are there...the state of the basement- you get the point.  I would bet that you'd have to finish the basement up to code, meaning an insection and approval before it's considered living space- therefore it may be too risky to YOU to not have it finished if they are going to use it as living space.</p>
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<p>If you allow the "guests" to stay- then they need to pay rent, provided that it's legal to have that number of people in the house you are renting.  They also need to pay rent.  This is just a mess, imo.</p>
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<p>I would start by getting the LLC- great tip.  Then I'd do an inspection after x-mas. I would talk to the tenents about these guests.  I also would have checked into the max occupancy laws in your state before then (you can probably find it online) and then you will know if it's legal to even have them stay.</p>
 

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<p>Not every lease states this.  It's something that you have to decide as a landlord.</p>
<p> </p>
<p>I've rented before, and it outlined every. single. thing.  Down to "only one nail hole per wall is permitted".  yes, and we still (stupidly) signed the lease.  :lol</p>
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<p>Our current lease is only signed by my husband, doesn't list occupents at all, and is very, very laid back. <br>
 </p>
<p>completely different trains of thought there.</p>
 

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<p>On the liability issue, you may not be liable for all those people or you may. A court would decide that. Point being, you will have to defend yourself up to the point that the courts decides. Which can wipe you out. My starting point would absolutely be checking the laws. (occupancy, checking on the "finishing" of the storage room to make sure there are no code issues, etc). Then I would lay it out to the my tenant that I am not comfortable with it, talk about the legalities, and give a fixed time period to correct the issues. (all in writing of course). </p>
 

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<p> </p>
<p> </p>
<p style="margin-top:0px;margin-right:0px;margin-bottom:0px;margin-left:0px;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:0px;"> </p>
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<p style="margin-top:0px;margin-right:0px;margin-bottom:0px;margin-left:0px;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:0px;">Originially Posted by <strong style="font-style:normal;font-weight:bold;">surrogate</strong></p>
<p style="margin-top:0px;margin-right:0px;margin-bottom:0px;margin-left:0px;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:0px;"> </p>
<p style="margin-top:0px;margin-right:0px;margin-bottom:0px;margin-left:0px;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:0px;"><em style="font-style:italic;font-weight:normal;">Keyword is stored, i always assumed people used basements FOR storage.  Then again I live in an area with no basements...so IDK.  I rent, and I would be mortified if my landlord told me how many adults i could have visit at a time and for how long...woah...</em></p>
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<p style="margin-top:0px;margin-right:0px;margin-bottom:0px;margin-left:0px;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:0px;">The key is that the OP saw that the amount stored there changed SIGNIFICANTLY (by roughly an apartment's-worth of stuff) partially through the lease.  Could they have emptied a storage unit?  Sure.  But given all the other things she saw, it's an awful lot to assume and trust when it's your butt on the line if someone gets hurt in a fire.</p>
<p> </p>
<p>As for how many people could visit at a time and for how long, you might be envisioning something different from what I'm talking about.  Having someone stay for the weekend (or two) is not the same as having someone (or 3-4) for a month.  And in places where it's customary for a landlord to pay one (or all) of the utilities as part of the lease, I can't imagine a landlord NOT doing this as a matter of managing their costs for water usage, electricity, etc.</p>
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<div class="quote-container"><span>Quote:</span>
<div class="quote-block">Originally Posted by <strong>yarngoddess</strong> <a href="/community/forum/thread/1283474/concerns-about-tenants#post_16096811"><img alt="View Post" class="inlineimg" src="/community/img/forum/go_quote.gif" style="border:0px solid;"></a><br><br><p>Some states (maybe all) have a max number of people based on number of rooms. </p>
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<p>Where I was, it was a matter of number of bathrooms per adult.  And it changed by town.  :/<br>
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<br><br><div class="quote-container"><span>Quote:</span>
<div class="quote-block">Originally Posted by <strong>BetsyS</strong> <a href="/community/forum/thread/1283474/concerns-about-tenants#post_16097040"><img alt="View Post" class="inlineimg" src="/community/img/forum/go_quote.gif" style="border:0px solid;"></a><br><br><p>Not every lease states this.  It's something that you have to decide as a landlord.</p>
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<p>I've rented before, and it outlined every. single. thing.  Down to "only one nail hole per wall is permitted".  yes, and we still (stupidly) signed the lease.  :lol</p>
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<p>Our current lease is only signed by my husband, doesn't list occupents at all, and is very, very laid back. <br>
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<p>completely different trains of thought there.</p>
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Agreed--it's completely a landlord-by-landlord thing.  We've always used a very detailed, non-standard lease; but have never gotten to the number of nail holes in a wall (probably because "leaving it in the condition they found it" covers that... and I'll use security deposit funds to repair it if they don't).</p>
 
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