The jig is up for a Buffalo landlord who charged students rent for apartments they were never able to occupy.
An investigation by Attorney General Letitia James revealed that Monarch 716, a student housing provider with a collection of properties near the State University of New York at Buffalo, deceived student renters by allowing them to sign leases it later deemed they were unqualified for, then demanding they pay the entire lease term’s rent.
Through Monarch, tenants would sign a rental agreement that included an option to provide a guarantor, the investigation found. If the student could not drum up a guarantor and did not meet the leasing criteria, Monarch would inform the tenant they could not move into the apartment, but still owed all the rent due.
“I never lived in a Monarch 716 apartment for even a day, yet was told I needed to pay thousands,” said Maria Reid, one of the college students affected by the scheme, in a statement.
The landlord also charged tenants multiple months’ rent in advance and would not release renters from their leases unless its portfolio was fully occupied. Only if Monarch had no vacancies would it fill the apartment with a new renter.
Read more
Commercial
New York
Student housing complex near Columbia University trades for $84M
Commercial
New York
Student housing survives pandemic and investment returns
Such practices violate a slew of state housing laws. The 2019 rent law made it illegal for landlords to charge tenants any more than one month’s rent as a security deposit. And under New York’s real property law, if a tenant breaks the lease, the landlord has a duty to “mitigate damages” — that is, find another renter for the apartment and let the previous tenant off the hook.
Charging tenants a full term of rent all at once is likewise, a no-no in New York.
Some students said they were charged upwards of $10,000 by Monarch. The balances were sent to a third-party collection agency, which “engaged in aggressive and sometimes harassing collection techniques,” the attorney general’s investigation found.
The collection agency would then relay those concocted debts to credit reporting agencies, “ruining our credit,” said Reid. That violates yet another state law.
The landlord would make an exception for students who could find a replacement tenant for the apartment, if there were no vacancies in its portfolio. Monarch would release that tenant from the lease, but only after charging an illegal $300 fee for doing so, according to the attorney general.
In all, James’ office forgave $200,000 in illegally created debt and recouped over $65,000 for hundreds of students.
Monarch, which did not return a request for comment, was also fined $50,000 — which amounts to the annual rent roll of a handful of students.