UrbanSpeaker

Top 10: Deal With Bad Tenants

January 25th, 2010. Published under Top 10. 2 Comments.

I own a rental property currently, and I have 3 people renting from me.  Unfortunately, I had a bad tenant.  Not one who didn’t pay rent or damaged things, but someone who was very disturbing to the other tenants.  The eviction process went quite smoothly, and despite a few insulting letters, I remain unscathed.

Over the past 9 months, I have learned a tremendous amount about how to be a friendly landlord, but also how to deal firmly and in a controlled manner with any issues that arise.

1. Interview your Applicants

Letting people into your unit because they are your friends is not a good enough reason to begin a lengthly business relationship.  It is important to consider what would make this person a good or a bad tenant.  There are many factors that could indicate a bad tenant, such as bad credit history, criminal record or mental/physical health issues. Do your due diligence.

2. Sign the Papers

My bad tenant refused to sign the lease agreement before moving in.  To avoid any hassles, legal or otherwise, have the lease agreement signed before you hand over the keys. (and if the tenant is under 18, have them get a co-signer)

3. Take Care of Your Own

To be a good landlord, make sure that you are prompt in making any necessary repairs.  Mole-hill sized problems that are left can often become mountains.  Get out and buy yourself some decent tools that you can rely on for as long as possible.

4. Start a Slush Fund

Keep a bank account for all your rental affairs.  Deposit rent checks, and withdraw to pay bills and the mortgage.  Over time, if your unit is profitable, your account will build up a positive balance.  This “slush” at the bottom of the account will help out if there are ever any surprises.

5. Take a Month

When a new tenant moves in, collect their first and last month’s rent.  This will help protect you from tenants who break contract, are delinquent or refuse to pay for repairs when they leave.  It’s a small insurance policy for any eventuality.

6. Get it in Writing

If ever you have to deal with a unruly tenant, make sure you deal with them through email as much as possible.  That way all your interactions are documented and can be reproduced if necessary.  However, you should also be available via phone as much as possible, just incase there is an emergency.

7. Join the Club

In most cities, there are landlord boards or organizations which can be very helpful to many situations.  Many of the people who volunteer with them are landlords, or ex-landlords themselves, and often have been in the same situations that you are dealing with.  It always helps to have some backup.

8. Secure the Area

No neighborhood is completely safe from break-ins or vandalism and it is important to keep your property and tenants safe.  Keeping criminals away could be as simple as trimming your hedges up and installing motion-sensitive lighting, neither of which cost much at all.  Assess your area and act accordingly.

9. Don’t Include it All

When you advertise a property, consider what you will be including with it, such as cable, TV, hydro, a refrigerator, washer, dryer, etc.  The more you are responsible for at a property, the higher the odds are that something may get destroyed.  A lower rent where the tenants pay more per month for things they want extra is a better route then charging more and giving more right off the bat.

10. Keep Going

Don’t be afraid!  Being a landlord is a lot of fun, and if you go about it the right way, you will never regret it.  Keep learning and remember why you’re doing it.

Photo by: Kodiax2