What to Do With Abandoned Tenant Property In North Carolina
As a property investor in North Carolina, you are bound to come across abandoned tenant property.
In fact, we can assure you it is going to happen at some point.
Abandoned property can take the form of a tenant leaving property after the lease agreement expires, after a tenant is evicted, or if the tenant decides to skip out of town on the lease agreement all together.
The key to knowing what to do with abandoned tenant property is to follow the law as laid out, otherwise you could end up footing the bill even when you thought you were doing something correctly.
We would like to note, before we begin, that your lease agreement is your best offense and defense. Your lease agreement should spell out clearly the who, how, what, when, and why of abandoned property.
Having a properly constructed North Carolina lease agreement that hits on the right points will make everything else easy.
But since you may not have the provision in your lease agreement, here are the steps to get you started.
Step 1: Is the Tenant’s Property Actually Abandoned
There are several ways you can determine if property is abandoned under North Carolina law. While you don’t need to do them all, you should make sure you check off one of the boxes to keep you in the clear.
Method 1: The Tenant Voluntarily Moves Out and Abandons the Property
Voluntarily leaving is by far the best way to establish that the property is in fact abandoned.
In the event the tenant’s lease has expired, and they have vacated the property, is more or less presumed to be abandoned.
We recommend, however, that you take into account the fact that the tenant may have simply overlooked the property when they left.
In this case, you may want to reach out to the tenant to determine if they would like to regain possession of the property.
Method 2: Posting of a Notice About the Abandoned Property
The other way you can determine if the property is actually abandoned is by posting a notice on the rental property both inside and out of it.
Substantively, the notice should:
1. State that the landlord is considering the property abandoned;
2. If the landlord does not hear from the tenant in 10 days, the property will be considered abandoned.
In the event the landlord does not hear from the tenant in the 10 days under the notice, the property is considered abandoned.
Method 3: Abandoning Property After an Eviction
In the event a tenant has moved out after an eviction proceeding, you can consider the property abandoned.
North Carolina General Statute § 42-25.9(g) states, in relevant part, that:
Seven days after being placed in lawful possession by execution of a writ of possession, a landlord may dispose of personal property remaining on the premises
There is more to disposing of abandoned property after an eviction, and you if you are going through the eviction process, we suggest you read our blog on How to Evict a Tenant in North Carolina.
What Should A Landlord Do With the Abandoned Tenant Property
In the event the tenant has in fact abandoned the property, your next step is determining what to do with the abandoned property.
Step 1: Determine the Value of the Abandoned Property
Valuation of the abandoned property is necessary for you to determine the best way to go about getting rid of it.
Property Worth Less Than $750: Non-Writ of Possession
In the even the property is worth less than $750, and the abandonment is not following the execution of a writ of possession, your options are limited. For property worth less than $750, you can only donate the property to a nonprofit that provides clothing and household goods to needy individuals.
In exchange for your donation, the nonprofit must agree to store the property for at least 30 days, and release the property to the tenant if the tenant wants the property back.
Storage of the property by the nonprofit is at no expense to the tenant, or to the landlord.
In the event you decide to use this option, notice must be placed on the rental property, and mailed to the tenant’s last known address, informing the tenant:
1. of the location of the property; and
2. that the tenant has 30 days to claim the property;
Property Worth More than $750: Non-Writ of Possession
North Carolina law is actually silent on what you are to do with property that is worth more than $750.
Our recommendation, and what we find is the best course of action, is to file an eviction lawsuit in court (if you haven’t already gone through the process).
An eviction will get you the best results you are looking for to dispose of the property and avoid any headaches.
In the event you have already gone through the eviction process, you don’t have to worry about filing it again, but if the tenant has abandoned the property prior to the execution of the Writ of Possession, go forward with the Writ as this will give you more things you can do with the property, and negates the $750 valuation.
If the tenant’s property is worth less than $500 after you have received a Writ of Possession, then you must wait 5 days before you can dispose of the property.
The good thing about property less than $500 is that you do not have to provide notice to the tenant, you just have to wait the 5 days.
However, if the tenant reclaims the property within the 5 days, you must release the property back to the tenant.
Abandoned Property Worth More Than $500: Writ of Possession
In the even the abandoned property is worth more than $500, North Carolina law mandates that you wait at least 7 days prior to selling or disposing of the property.
If you intend on selling the property, you must provide notice to the tenant of the following:
- a detailed accounting and description of the property;
- the estimated value of the property;
- where the property is located and where it can be claimed;
- the date, time and location of sale; and
- notification that money will be applied to unpaid rent, storage fees, and damages not covered by the security deposit, if applicable; and
- notice of where and how the tenant can claim any leftover proceeds of the sale.
In the event the tenant does not stake claim to the leftover proceeds of the sale, the remaining money must be turned over to the court.
Check the Terms of the Lease Agreement Concerning Abandoned Property
In accordance with North Carolina law, the lease agreement cannot reduce the notice periods for abandoned property. So even if your lease agreement allows for a shorter time period, North Carolina law will mandate you follow the 5 or 7 day notice period.
What the lease agreement can do, is extend the time of notice for disposal of tenant abandoned property.
In the event your lease agreement sets forth a time more than 5 or 7 days, you must follow that notice period before disposing of the tenant’s property.
As you can see, disposing of tenant abandoned property is not as easy as it seems.
The stakes, however, are high.
Can you imagine getting rid of what you thought was tenant abandoned property, only to receive notice a couple of days later that the tenant wants their property back?
And guess who is going to be stuck with an expensive bill?
If you have any questions, don’t hesitate to reach out to us.
We are here to help.
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