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RS Unit - Surrender Documents?

NYC Rent Regulation: Rent Control/Rent Stabilized, DHCR Practice/Procedures

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RS Unit - Surrender Documents?

Postby KT356 » Thu Aug 17, 2017 12:38 pm

An acquaintance left his apartment after nearly 2 decades of residency and I signed a “lease” with him last July ’16 and have paid $2,200 to him each month since. He is the primary tenant and notified me last month that he didn’t renew the lease. Since I’ve made this a home and did more upkeep than he ever had I said I’d like to try to say and asked him to refer me to the management company. He did and told them I was his cousin and because he’s known them awhile he said “they are eager to get the apartment back, but are willing to let me stay with the understanding that no renovation will be done and a rent increase to $2,500.” I submitted my application, but haven’t received details on the monthly rent or the lease in my email communications with the company. I confirmed with the DHCS that the unit was registered as rent stabilized in 2016.

Today, they management company said their attorney is finalizing the surrender documents. I thought surrender documents were for when you break a lease and the primary tenant's lease supposedly ends on August 30, 2017 so I don’t understand why those would need to be drafted for me to take over a lease. Since the management company doesn’t know that the primary tenant illegally sublet the apartment to me and that I’m living there, I worry surrender documents will cancel any chance I have at moving in. The building has recently received violation notices and my unit isn’t in the best shape so my friend suggested I just go ahead and send them a rent check and if they cash it they are bound to it. Any suggestions on how to handle this situation? I’m new to NYC and really don’t want to move in 2 weeks if I can help it.
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Re: RS Unit - Surrender Documents?

Postby TenantNet » Thu Aug 17, 2017 1:08 pm

"An acquaintance left his apartment after nearly 2 decades of residency and I signed a “lease” with him last July ’16 and have paid $2,200 to him each month since."

This sentence doesn't make sense. Can you clarify?

Are you a sublet, or a roommate? That is not clear.

No, you won't have to move in 2 weeks even if you don't get a lease. The LL would have to take you to housing court (not a great thing, but better than being on the street). In many cases tenant negotiate time to move.

As this is a rent stab unit (since you posted in the RS section), do you know what the legal rent that the primary tenant pays to the landlord? Are you paying more than half of the legal rent? If so, you might have an overcharge claim against the tenant. But don't do anything about that until you get the lease.

If you are a roommate (assuming you have no closer relationship), the lease tenant essentially has control while he is still in possession. In some cases the tenant can assign a unit, but in other cases the LL will decide who gets to move in. If they don't want you, they can get you out (although it might take some time if you want to stay put).

Normal vacancy increases are 20% and the LL can also add an increase for improvements ... how much depends on how many units are in the building.

So the LL want $2,500 to let you get a lease in your name. Of course if you don't agree, then you won't get it. So that's the firsts consideration. You can't make any complaints unless you have legal possession.

But once that happens you should fully research the unit to see if the LL is charging an illegal rent. An even number, i.e., $2,500 even as opposed to $2,436.88, is a sign that the rent may not be legal.

BTW, it's DHCR, not DHCS.

If the tenant's lease ends at the end of this month, no surrender documents are needed. I don't know what the LL's lawyer means by that. But it's not needed if the lease ends on its own. If anything, it might be something stating that possession has been returned to the LL along with the keys. But that would be something between the landlord and the old tenant.

Whatever you do, document everything. Make copies of ALL documents, before and after signing. Keep a diary of all that happens and all that anyone says. Take many photos. Keep records as ling as you have the place.
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Re: RS Unit - Surrender Documents?

Postby KT356 » Thu Aug 17, 2017 2:26 pm

Thanks for your quick reply! To clarify, I'm subletting from the primary tenant who didn't tell the LL/management company that he was subletting. He's told them I'm a relative which is why they are considering renting to me, but I haven't received a lease in the 3 weeks of emailing. Should I be concerned that because I'm not on the primary tenant's lease and LL doesn't know I'm living here alone they will kick me out at the end of PT's lease on 8/31/17?

The actual rent the primary tenant is paying is $200 less than he charges me. The LL never told me it would be $2,500, only the primary tenant. At this point, all I want is a legal lease to take over the apt and not deal with the primary tenant anymore.

Lastly, DHCR told me they need to include a rent stabilization rider or a document that states they have destabilized it. They haven't made any improvements to the unit or building since I've lived here so I believe it still constitutes as RS, but if they don't include a rider with my lease should I ask them about it or just sign the lease and then file a complaint with DHCR? I don't want to jeopardize anything until I legally get the apartment.

Sorry for any confusion in explaining this - totally new to this and very worried. Thanks again!
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Re: RS Unit - Surrender Documents?

Postby TenantNet » Thu Aug 17, 2017 3:12 pm

I wouldn't be concerned just yet. They won't kick you out right on 9/1/17. They can't. They would have to go to court and that could take a few months. Just don't get freaked out.

It seems you might have cause to go after the prime tenant for overcharge ... maybe. In some instances a tenant can charge more than the legal rent. See the current RGB order for details. https://goo.gl/5qYKqX -- the LL can charge an additional 10% for sublet. But that would be the LL who charge that, and who gets it. If the prime tenant didn't tell the LL, then chances are he's pocketing it. (which is why you need to get the new address and new tel. number of the prime tenant).

But do nothing until you get a lease.

If the legal RS rent is just $2,000, then the LL can add on a vacancy increase of 20% plus up to 1/40th the cost of any real improvements. (or 1/60th in some cases, see page 6 at https://goo.gl/WdFztu).

The LL can't deregulate it unless the rent is above $2,700. Yes, they need to attach a DHCR rider to any vacancy or renewal lease. The LL might tell you the rent is that high, so again, you can't do anything unless you have the lease. If they don't add a rider, do not worry until you have the lease with the landlord's signature on it. Just wait and don't ask too may questions, or they will rescind the offer. Once you have it with the LL's signature, they can't rescind it.

Take photos of the lease they offer to you BEFORE you sign it in case they don't return it to you with the LL's signature on it.

But right now have witnesses come in and take note of everything. The LL might want to redo the kitchen, the bathroom and other things. Take MANY before and after photos. Many LLs just tell the tenants they did the work and don't really do it.
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Re: RS Unit - Surrender Documents?

Postby BubbaJoe123 » Fri Aug 18, 2017 12:24 pm

TenantNet wrote:...the LL can charge an additional 10% for sublet. But that would be the LL who charge that, and who gets it.


This isn't the case. The 10% goes to the tenant, not the landlord, since the subletter is paying the tenant, and the tenant is paying the landlord. Per the RSC:

(b) The rental charged to the subtenant by the tenant shall not exceed the legal regulated rent plus no more than a 10-percent surcharge payable to the tenant if the housing accommodation is sublet fully furnished. Where a tenant violates the provisions of this subdivision, the subtenant shall be entitled to treble damages.

http://www.tenant.net/Rent_Laws/rsc/rsc2525.html
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Re: RS Unit - Surrender Documents?

Postby TenantNet » Fri Aug 18, 2017 12:39 pm

Except Section 2525.6 (b) refers only when the unit is fully furnished. I was referring to the section mentioned in the RGB order, 2525.6 (e),

(1) Upon the consent of the owner to a sublet, the legal regulated rent payable to the owner effective upon the date of subletting may be increased by the vacancy allowance, if any, provided in the rent guidelines board order in effect at the time of the commencement date of the lease, provided the lease is a renewal lease.


Theoretically the subtenant could be hit with 10% going to the TOR and another 10% going to the owner (through the TOR).
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Re: RS Unit - Surrender Documents?

Postby BubbaJoe123 » Fri Aug 18, 2017 1:01 pm

TenantNet wrote:Except Section 2525.6 (b) refers only when the unit is fully furnished. I was referring to the section mentioned in the RGB order, 2525.6 (e),

(1) Upon the consent of the owner to a sublet, the legal regulated rent payable to the owner effective upon the date of subletting may be increased by the vacancy allowance, if any, provided in the rent guidelines board order in effect at the time of the commencement date of the lease, provided the lease is a renewal lease.


Theoretically the subtenant could be hit with 10% going to the TOR and another 10% going to the owner (through the TOR).


I understand what you're saying, got it. One note, the rent the tenant would owe the LL would go up by 18% (assuming a one year lease, and also assuming we're not dealing with a relatively short tenancy and a pref rent, which would lower the cap), not 10%. I'd assume the 10% surcharge in the rent owed by the subtenant to the tenant would be on top of that. So, for an apt with a legal rent of $2k, the rent owed to the landlord would go up to $2360, and the subtenant could be charged up to $2596, if the apt is sublet furnished.

Unclear to me from the text whether, once the sublet ends, the vacancy increase is reversed, but I don't think so.

In any case, if the subtenant had been paying $2200, and the tenant was paying $200 less than that, it doesn't sound like there's an overcharge if the apartment was furnished. If not, then there is an overcharge.
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Re: RS Unit - Surrender Documents?

Postby TenantNet » Fri Aug 18, 2017 1:53 pm

It's all speculation at this point. The subtenant should try to get the lease, then sort it out later.
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