What Every Landlord Needs To Know: How To Identify Bad Tenants and What To Do

What Every Landlord Needs To Know: How To Identify Bad Tenants and What To Do

February 5, 2018
What Every Landlord Needs To Know: How To Identify Bad Tenants and What To Do

We know many landlords like to manage properties by themselves – however, like managing anything, there is a degree of responsibility and experience when it comes to selecting the right tenant. Tenants come in all different shapes and sizes, but the bad tenants really affect you as a landlord and the value of your property.

Here are some examples of bad tenants:

Tenants from Hell
Tenants from hell can be a constant pain in the neck to deal with. Although the tenant themselves are not necessarily toxic, they may have an exaggerated perception of your responsibilities. These tenants they call you up on a regular basis to fix minor issues that you don’t have time for. Over the period of the lease you might be losing more money than you are gaining relative to the time you are putting in for them.

The ‘Non-Payers’
This is a classic bad tenant. This tenant fails on multiple occasions to pay their monthly rent in addition to ignoring emails, phone calls and letters. You as a landlord end up tirelessly chasing this tenant just so they can fulfil one of the most fundamental conditions of your agreement. Unfortunately, if not dealt with promptly, the missed payments can add up as sunk costs.

The ‘Overdue Payers’
Although this tenant pays their rent, they don’t pay on time. Your legal agreement may state that they must pay by the deadline otherwise late payment fees may be incurred. However, these ‘overdue payers’ may even miss these fees, and as a result, the cost of paying rent may continue to increase, making it harder for them to pay time and time again.

The Rule Breakers
Under every lease agreement there are rules outlined on what the tenant can and can’t do. Regardless of the legally binding nature of these documents, rule breakers as the name suggests may (discretely or not) break these rules. For example, you may have a no illicit drugs rule, however, as you are not around all the time, your tenant may take or even sell drugs, and you may not even know about it upon inspections.

The Destructive Tenants
Leasing out your property comes with an expectation that you will be making profits. Destructive tenants do the opposite and causes you to incur a significant amount of losses to your property. All the money you do make goes back into maintenance and repair. It can be quite a tiresome ordeal to have to handle these kinds of tenants.

The Bad Egg
Bad egg tenants may be ones with nothing to lose. The problems revolving around this tenant is a combination of all the bad tenants listed above. Because they already have a bad credit report, eviction history and among other things, these tenants may resolve to break rules, be destructive, pay late, not pay at all and treat your property as if its their own. Detecting these tenants early is the best prevention against these types of tenants.

How To Deal With It

  1. Screening Processes and Check
    Prevention is the best solution. Before you sign on any tenant, the number one rule of thumb is to screen your tenant and do many checks. Some checks you can perform are background checks on credit (to see if they can pay on time), criminal history and or if past landlords have evicted them for any reason. With reliable checks and screens in place, you may be able to prevent the problems from occurring long before they start.
  2. Communication, Communication, Communication
    If we haven’t stressed enough, communication between you and your tenant is the best solution to deal with these tenants and the problems that may come along with them. When you communicate, either in person or through email or phone, it is important to lay down the ground rules and that both parties understand the agreement before moving forward. In some cases, the tenant might have been in an accident which might’ve been the reason for their overdue payments. Once things are clear, you as a landlord can be more direct with your actions.
  3. Punishment and Legal Action
    Screening and checks aren’t always perfect and despite attempting to communicate with them, the results aren’t always satisfactory. What you can do at this point is a number of things:
    – Document their misdoings
    – Send tenants official warnings
    – Consult your lawyer for further action
    – Evict them
    Bad tenants usually take advantage of inexperienced landlords. If you have property located in many places, it may be difficult to manage your property and ensure the smooth running of it all. Here at Property Managers we take the stress out of dealing with these bad tenants and ensure that at every step of the way, tenants are properly screened, communicated to and dealt with promptly.

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