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    Withdraw 401 K to catch up and pay off

    I have a strange situation. I am the landlord for property where the renter's owe three months. The renter wants to with draw 401 k to help get paid up on all his bills such as cars rents insurance through December. Then pay off the others with the difference for the next six months and save to help with down payment of purchasing the house they are in. Please help me to see if there is a different way. The spouse feels we are taking advantage of them by making the pay through the end of the year. However we want to sell, had a buyer but didn't because the buyer was going to raise the rent and we knew they would have to get out with the babies. I don't know what to do...I am not a landlord...I want to sell this house and be done with it all...but they need help too.

    #2
    Originally posted by Dbavirtuoso View Post
    The renter wants to with draw 401 k to help get paid up on all his bills
    A horribly stupid idea, but not your business.

    such as cars rents insurance through December.
    Why on earth would they want to do that?

    and save to help with down payment of purchasing the house they are in.
    Rent to buy the house that you currently own??

    Please help me to see if there is a different way.
    None of your business.

    The spouse feels we are taking advantage of them by making the(m) pay through the end of the year.
    Pre-pay 6 months rent?????? Why on earth are you making them do that??

    There's obviously something you aren't telling us.

    Comment


      #3
      Are you friends with the renter?

      If not friends, then keep it strictly a business relationship; i.e. do things within the law and do whatever makes financial sense for you.

      If friends, then personally, I'd advise you to forgive the 3 months back rent and ask them to move out so that you can sell the place.

      Comment


        #4
        This should be a business relationship. I'd say that it is none of your business or concern how your renters get the rent money to you. Withdrawing a 401K is a horrible idea, but it isn't really any of your business. If they don't pay the rent or meet whatever obligations that they are supposed to as renters, then you can move to start the eviction process.

        I agree that there is more to this story. I'm going to guess that your renters are actually relatives.
        Brian

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          #5
          Clearly we don't have all of the details here.

          Why are you asking them to pay through December? It's only May. I'm sure that's not what the lease says. Are you offering them them nice discount for pre-paying? If not, why would they agree to that?

          Should they cash out their 401k? Of course not. Is that any of your concern as the landlord? Definitely not. Stay out of their personal business. If they can't pay the rent as scheduled (not months in advance but just the regular payments) then you need to evict them.
          Steve

          * Despite the high cost of living, it remains very popular.
          * Why should I pay for my daughter's education when she already knows everything?
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          Comment


            #6
            Originally posted by bjl584 View Post
            I'm going to guess that your renters are actually relatives.
            Didn't think of that... Rule #3 of reducing family tension (after not talking politics or religion) is don't get in "money bed" with relatives".

            Of course, I borrowed money from my grandfather in time of need, and my father holds my mortgage. Paid back gf as soon as I got back on my feet, and would never dream of missing a loan payment to family.

            Comment


              #7
              Having been a landlord before, I recognize the tenant game here. They are three months behind and now telling you they have a "plan" to get lots of money and bring all of their bills current, including yours. Plus try to buy your house. Which they know you want to get rid of.

              I'm a pretty trusting guy but I recommend you separate all the components of this "plan" from each other. First and foremost, they owe you three months of rent. Until this gets taken care of, the other 23 parts of their plan are meaningless. Maybe they are being honest but the fact is they are three months behind in their rent to you.

              You need to start the eviction process. If they are serious about this "plan", they will get current. They are playing on your emotions to live for free in YOUR house!!
              Phil Danley
              100% Debt Free since 2014
              http://www.ConsumerDebtCoach.com

              Comment


                #8
                Originally posted by PhilDanley View Post
                Having been a landlord before, I recognize the tenant game here. They are three months behind and now telling you they have a "plan" to get lots of money and bring all of their bills current, including yours. Plus try to buy your house. Which they know you want to get rid of.
                ...
                You need to start the eviction process. If they are serious about this "plan", they will get current. They are playing on your emotions to live for free in YOUR house!!
                People with four babies would never do that! It's, it's, it's... bad parenting!!! LOL

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