Real Estate

Dealing with Bad Tenants: 13 Problems Homeowners Face

Tenants’ problems plague landlords every day. However, cutting rent to keep good tenants and evict problem tenants may not be the best solution.

While lower rents obviously affect a landlord’s bottom line, evictions are also costly and can cost the landlord time, money and resources. In addition to basic sales expenses such as marketing, lost rent, new paint, and appliance repairs, the attorney fees to evict a tenant can be outrageous. Additionally, a tenant can express their anger by willfully damaging the property.

Whether you’ve been a homeowner for much of your life or preparing to rent out your first property, it’s important to understand that you may need to go through the eviction process at some point in your career. Even if you are a good landlord and do your best to build positive relationships with your tenants, in some cases, relationships deteriorate. But instead of issuing an eviction notice right away, you might want to try some of the proven tips for solving common tenant problems.

Common issues that homeowners face

1. Tenants refuse to pay rent

Tenants can withhold rent from landlords for a variety of reasons, ranging from lack of cash or temporary unemployment to disputes over repairs and maintenance. Communication is essential when dealing with this problem, and it is important to understand the tenant and the nature of the problem and to try to negotiate, if possible.

Structure payment options
If the tenant is having cash flow issues, the most effective method of collecting rent is to structure payment options. As a landlord, you need to recognize that people sometimes have difficulty with bills, so you can try implementing a policy of accepting partial payment from a resident once a year. Another good way to collect is to prorate late fees and late rent for the remainder of the tenant’s lease.

You can also negotiate weekly partial payments to ease the tenant’s cash flow and even apply a portion of the security deposit to ease the strain on the tenant’s wallet. Establishing a strict payment plan and following up to make sure the tenant is on the payment plan is the fundamental key to success. In general, the most suitable tenants for flexible payment plans are those who have short-term financial problems and tend to pay while they have money rather than under the terms of the lease.

Change of lifestyle
If a tenant can no longer pay rent, landlords can either move in with roommates or move them to smaller, cheaper units. Landlords who make this effort and offer options to their tenants can be rewarded with tenants for life.

However, if negotiation and communication do not resolve the issue, you can try to convince the tenant to leave voluntarily. If the tenant cannot pay, explaining the long-term impact of the eviction on their credit and rental record can convince them to relinquish ownership of the unit. Letting your free will be a much better option than facing legal fees and bad debts.

2. Bad tenants escape your selection process

An easy credit check and application may not reveal enough about past tenant issues, but it’s a great place to start. Here are several ways that landlords can ensure that the tenant selection process eliminates problematic tenants:

Conduct a thorough background investigation. A thorough background check involves the selection of employment and rental history, credit checks, and interviews for all potential tenants. To perform a credit check, get the social security number, address and name of the applicant, and make sure you have their authorization. Some homeowners require payment of credit check fees, which can cost anywhere from $ 30 to $ 50. While you cannot request a report directly from Experian, TransUnion, or Equifax, you can use a tenant screening service. or a credit bureau.

  • Conduct a thorough background investigation. A thorough background check involves an assessment to check employment and rental history, credit checks, and interviews for all potential tenants. To perform a credit check, get the social security number, address and name of the applicant, and make sure you have their authorization. Some homeowners require payment of credit check fees, which can cost anywhere from $ 30 to $ 50. While you cannot request a report directly from Experian, TransUnion, or Equifax, you can use a tenant screening service. or a credit bureau.
  • Please request a completed application upon presentation. Ask potential tenants to complete the application on the first visit. By allowing them to resend the form later, you are essentially giving applicants the ability to create stories and recruit family members or friends to represent current and former employers and owners.
    Talk to the previous owners. When looking for a candidate’s background, talk to their previous owner, not their current one. If the tenant is unwanted, the current landlord can give them an enthusiastic recommendation, hoping to make the tenant their problem.
  • Contact the candidate’s direct supervisor. Instead of contacting the human resources departments of potential tenant employers, contact their direct supervisors. A helpful, honest and trustworthy employee is likely to display the same personality traits as a tenant.

There is almost always room for compromise. A person with bad credit is not necessarily a bad tenant, as people tend to pay their rent first. Proceed with caution if only part of an applicant’s background check is tarnished. Depending on the severity of the problem, you may offer the requester a trial period with a higher-than-normal security deposit or for a three-month trial period.

3. A building has a bad reputation

From loud parties to unfavorable people who stay in the shadows, there are many reasons why apartment buildings can regularly develop unsavory reputations that affect a landlord’s ability to attract well-qualified and respectable tenants. Concrete steps like renaming the building, fixing neglected landscaping, and repainting need to be swift, so residents see immediate changes, even if they are small at first.

Talk to law enforcement

If necessary, contact the police to find out if certain units in your building generate an above-average number of police calls. With the active cooperation of the police, you shouldn’t have a hard time chasing bad tenants from the property.

Another option is to pay for a police station at one of the rental offices on your property. This can be done by renovating an empty unit into a smaller office with limited services. You should contact your local sheriff’s department for more details and see if such an arrangement is possible.

If you and the resort can’t get along, offering free apartments or reduced-rent units to probation officers and police officers can make it difficult for tenants to vacate the premises immediately and voluntarily.

Develop a system
After weeding out bad tenants, set up a system where quality tenants receive rent credits for partial months, cash or gift cards for referrals. Having such a system in place can help repopulate your property with good and decent residents.

Also, it is important to publicize your efforts. Building a relationship and networking with other property managers in your area can help spread the positivity you are trying to bring to the community. Try to put up signs announcing the new direction and the name of the property to raise awareness in the community.

4. A tenant regularly disturbs the neighbors

While implementing a thorough selection process can eliminate many problematic tenants, it may not prevent future disputes between neighbors. The activities of tenants can regularly, negatively and directly affect their neighbors.

Enable tenants to solve problems
One solution to such disputes is to suggest that all tenants settle the disputes among themselves. Make a clause in the lease that specifically states that all tenants must do their best to resolve the arguments without your intervention. Include a message that if you must participate, a tenant may not be happy with the resolution and someone has a good chance of leaving the property.

If you discover that two tenants are arguing through another resident, politely remind them of the terms of the lease and the possible consequences, such as eviction, that may lie in their future. While tenants are likely to argue, they can also learn to get along and respect each other.

Intervene if necessary

tenants simply cannot deal decently with each other, mediation may be the only option. If neither party is cooperating, explain the consequences in a calm manner to facilitate resolution. At some point, I hope your residents will understand that the net impact is on them, not you.

For added protection, if a tenant tries to blame management, make sure any lease or rental agreement has regulations and property rules, as well as strict clauses regarding such disagreements. You can give “three cautions and you’re out” notice or talk to your property manager about their experience handling disputes. It’s always a good idea to have some sort of documentation that you can refer to later when faced with an annoying tenant.

5. A building has a high turnover of tenants

One of the most common issues that tenants face that causes them to move out of an apartment are disputes over repairs. Therefore, ensuring that all responses to maintenance requests are professional, high quality, and timely is one of the most effective ways to maintain a positive relationship with your tenants. To facilitate inquiries, please send a monthly notice that tenants can dial and return to the office if they need to report a problem with their units.

Here are several other things you can try to help you fill your current vacancies:

  • Repair and upgrade units. Make sure all broken or damaged devices are dealt with before tenants complain. Anticipating complaints and correcting the problem reflects your respect for your tenants, as well as your pride in the building. For example, replace worn and worn out carpets and install energy efficient appliances, rather than making makeshift repairs.
  • Monitor the amenities and rentals of competing properties frequently. Tenants often move out to save money on another home. To avoid this, keep an eye out for the competition. Take a look at the market and know how you fit in there, and if you see rent drops on the horizon, lower your rent now. This guarantees a high occupancy rate while minimizing your losses to the competition.
  • Negotiate renewals in advance. It is common among good landlords to negotiate renovations with respectful tenants about three to four months before the end of the lease. Depending on current occupancy levels and the current market, you may offer a renewal incentive or a discount. If the rent needs to be increased, send notices to your tenants with a thank you letter and an explanation. Make sure that you or a member of staff personally deliver the letter to each tenant. For long-term renters, try modest annual rent increases. It may take a while to bring your entire community up to date with current market standards, but you could save money by not having to find new tenants if you evict current tenants.
  • Create a strong sense of community. Host pool or Christmas parties or decorating and gardening contests, or distribute a monthly newsletter where tenants can share information and contribute articles.

Other common tenant problems

6. Parasite problems

No one wants to live in a house with rodents or cockroaches running around. If you regularly avoid hiring an exterminator, you will likely see very high turnover rates in your properties.

Duplexes, apartments, and single-family homes can develop insect problems when the resident or neighbor brings these bugs in, and if you discover that a unit is contaminated with bedbugs, it won’t be long before all the units are out. Instead of letting the situation get out of hand, contact an exterminator to take care of the problem as soon as you hear or receive a complaint.

7. Roof problems

If you know your building’s roof is leaking, fix it immediately and never try to rent the property to an unsuspecting tenant. Tenants have all legal rights to a safe home, and the longer they leave a leaky roof, the more damage and retaliation they will face.

Even the smallest leaks can cause mold, water damage, or even roof collapse. By law, tenants can put their rent money into an escrow account and keep it until the roof is properly repaired, so it’s best to sort out these issues before scheduling a visit.

8. Broken devices

If your lease states that the property comes with appliances, you are legally responsible for the maintenance and repair of those appliances, unless otherwise specified. For example, you can include a clause that the property comes with a used washer and dryer, but the replacement is the tenant’s responsibility. However, if you promise appliances and a tenant moves into the unit and finds, for example, that the stove is broken, you need to remedy the situation as quickly as possible.

While buying a new appliance isn’t cheap at all, buying it before a tenant moves in can save you a lot of hassle and complaints. Keep in mind that tenants can file a claim against you or submit their rent payments to court or to a separate savings account until you repair or replace broken appliances.

9. Security deposit issues

If one of your tenants mistakenly thinks that you can use the security deposit to pay last month’s rent, you could be in trouble. Confusion arises when a tenant mistakenly believes they didn’t have to pay last month’s rent and the landlord can just use the security deposit instead. While the Civil Code states that a landlord can withhold the security deposit to cover the last month’s rent or any unpaid rent during the lease, if a tenant doesn’t pay anything, the security deposit may not be enough to cover the last month. months plus expenses.

If you’ve received an eviction notice from a tenant, but it’s still costing you a month’s rent, you can start the eviction process if you think that’s the best solution. Some landlords specify in the lease that the security deposit will not be used to replace the last month’s rent. You can also collect the first month’s rent, the last month’s rent, and a third installment to use as a security deposit. However, if you choose this route, make sure it is clear in the lease and understood by the tenant before signing the document.

10. Violation of the rules

A written agreement sets out the terms of your lease, including whether a tenant can sublet part of the space to another tenant, or whether a tenant has your permission to keep animals on the property. If the residence belongs to an association of owners, the tenant may be responsible for the exterior and landscaping maintenance of the building.

Whether you have witnessed a lease violation yourself or learned from a third party, it is important to notify the tenant of the violation in writing and ask them to correct the problem or face eviction. . For example, if your lease specifically states that pets are not allowed and you find evidence of a dog, send a letter to the tenant advising them that you are in breach of the terms of the lease and that the animal must be removed from the lease. the property. on a specific date.

Inform the tenant that if they do not relocate the animal then an eviction is possible. Alternatively, depending on the situation, you can make an amendment to the lease asking for an additional deposit and a monthly rent increase to cover any future damage caused by the animal. If the tenant does not comply with your request at the time of an inspection, you can decide whether an eviction is the appropriate action.

11. Late public services

Many landlords do not control payment for utilities until the tenant vacates the property. Whether the utilities are in your name or the tenant’s name determines who is responsible for overdue bills. Make sure your rental agreement is clear and precise.

For example, if you agree to the utilities being in your name and the tenant has to pay you monthly, those utilities will become your responsibility if the tenant leaves without notice. On the other hand, if your contract states that the utilities are on behalf of the tenant, the utility company will attempt to locate the resident in the event of late payment. The utility company cannot legally force a new tenant to pay the balance owed by a previous tenant.

12. Intentional damage

It is unfortunate that some tenants leave the landlord with significantly high costs by intentionally causing damage before leaving. In any case, it is always good to document the condition of the apartment: take photos of the property before renting it and take photos after the tenant has moved in. Make sure the photos are time stamped, as this can help prove your case in court.

In addition, you should always protect your investment by purchasing a home insurance policy specially designed for homeowners. Keep in mind that a traditional home insurance policy may not cover a rented apartment or building, so you need a policy that covers your liability when the building is rented, as well as any damage to your property. the structure caused by your tenants. .

There have been numerous cases of flooding or fires caused by problem tenants or other occupants who ultimately destroyed properties because the owner failed to insure the unit. This is why it is extremely important to protect yourself with a specific home insurance policy. Fortunately, liability coverage is almost always included in a landlord’s insurance policies, and liability coverage protects you from a lawsuit if your tenant decides to take legal action.

However, if your policy does not include liability coverage or if you want to increase your coverage, check with your insurer to see if adding this coverage is available through a comprehensive policy. To further protect yourself, ask the tenant to have a minimum amount of tenant insurance.

13. Illegal use of the home

If you are informed of any changes to your unit, it is essential that you take steps to protect yourself by seeking legal advice from an experienced lawyer and reporting the incident to the appropriate authorities. However, be careful to avoid negative reactions from the tenant.

On the other hand, you may have a tenant engaging in offensive behavior that negatively affects their neighbors, only to find that these activities are completely legal. In this situation, it is best to write a letter formally asking the tenant to stop acting immediately or face eviction. For example, a tenant can practice with his rock band from 10 a.m. Until 3 p.m. M. Every Monday and Wednesday. However, the municipal noise ordinance is at 11 p.m., so while your neighbor finds it disgusting and disrespectful, the tenant is legally entitled to play during those hours.

Eviction: the final solution

Unfortunately, in some extreme cases, eviction may be the only option. Sometimes a landlord finds that giving a tenant one chance turns into two chances, which then translates into a third chance, and so on. This is a waste of time, aggravates and can lead to loss of rental income.

If you think you’ll end up in court in the near future, or even just want to protect yourself, just in case, it’s always a good idea to keep a detailed record of tenant issues, as you need to prove. cause of expulsion in court. Many landlords underestimate the need for paper documents when dealing with troubled tenants, mistakenly believing verbal agreements are upheld in court. However, this process can be made much easier by documenting every interaction you have with your problematic tenants.

The common expulsion procedure is as follows:

  1. Understand the eviction laws in your city and state
  2. Have a valid legal reason for the eviction.
  3. Trying to reason or compromise with the tenant
  4. Serve a formal eviction notice
  5. File your eviction with the competent court
  6. Prepare and attend the court hearing
  7. Evict the tenant
  8. Collect any overdue rent

Since the cost of an eviction can be extremely high depending on the circumstances of your specific situation, taking legal action to evict a tenant should be your absolute final option. For example, some landlords have reported spending thousands of dollars to get troubled tenants out of their properties, and these expenses may include:

  • Court file fees: $ 50 to $ 500
  • Processing Server Fee: $ 30 to $ 150 per defendant
  • Related expenses: $ 400 to $ 700, depending on the difficulty of notifying all tenants of the service, as more than one attempt may be required
  • Eviction Services Company Fee: $ 140 to $ 500 to handle eviction documents
  • Legal counsel: $ 200 to $ 400 per hour, or $ 500 to $ 5,000 or more in total attorney fees if the tenant files for a trial and hires their own attorney.
  • Additional Charges: Depends on tenant damage and cost of repairs, loss of rent, new locks and cleaning.

Last word

If you decide that despite your best efforts, the relationship between you and your tenant just isn’t working out, it’s best that everyone involved begins the eviction process. However, check with your attorney to make sure you follow state and federal laws to do so and don’t try to remove the tenant yourself. Shutting down utilities, removing tenant property, or changing the locks on the front door of the complex or tenant’s apartment can have serious legal repercussions. An eviction may be the only solution, but to avoid involving the court system and lawyers, try to remain available and visible to tenants before issues arise and after they are reported.

Have you had to deal with annoying tenants? Do you have words of wisdom for other homeowners in the same situation?

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