Have you ever had a tenant damage your property? Is there really recourse for excess damage? Learn how to respond, how to prepare for, and how to prevent tenant damage in the future. In this video, we will discuss landlord and renter insurance, legal liability coverage, and the importance of regular rental inspections for landlords. 

If you’ve ever had a tenant damage your property, you know how frustrating it can be. Fortunately, there are easy ways to avoid these problems, provided you know what steps to take. Rentec Direct’s Brentnie and Kaycee discuss tenant-related damage and how it can be prevented and handled in this video. 

Tenant damage is an unfortunate and common occurrence for landlords, but it is fortunately avoidable. Explore the various ways you can discourage tenant damage and what responses you can take if you need to recover money due to the damage. In this video, we will discuss insurance, tenant screening, and other methods you can use to protect yourself from tenant-related damage. 

Can You Make a Tenant Pay for Damage? The Honest Answer – Video Transcript

Brentnie:

Hi, this is Brentnie and Kaycee from Rentec Direct. And today we have another landlord forum question. And I’m just going to hop right into it. This is an interesting one. So this person asks,  “Why does it seem like awful tenants get away with everything?” They say, “I’ve seen so many stories and posts of tenants leaving properties a war zone. And most of the comments are just saying to move on and not pursue anything. Why is this defeatist attitude so prevalent, at least on this subreddit?”

Kaycee:

My goodness. Okay. So I didn’t even know what the question was coming at me. I kind of wanted to approach it with a fresh mind and perspective. Initially, I want to just say, like, no, we love our renters. There are some ones that are challenging to deal with, and ones that cause damage are extra challenging to deal with. But the perception I want to put out there is that there’s a lot of great renters.

But the ones that cause damage and the ones that it can be hard to follow up with to charge for the damage they cause can be so frustrating because why should it be on me to take it out of my rental income to reduce or to get lost rent if I can’t rent it while it’s getting repaired? I’ve definitely been through these experiences as a landlord myself, and it’s frustrating. But I also want to put a little bit of responsibility back on me as a housing provider. 

If I want to reduce the chances of having damage done to my property, I really need to work on my tenant screening, making sure that we’re qualifying and accepting applicants that meet our written screening criteria, that have demonstrated responsibility through landlord references, and financial responsibility through their credit report, so I can set all of us up for the best chances of success and the best chances for non-damage. 

The other thing that I think is important that we all kind of get, we kind of incorporate into our management style, is routine inspections, because catching someone before a lot of damage happens or noticing kind of a lifestyle that would cause more damage in a house, like not taking out trash. I’m thinking of something that would attract pests, keeping things in a closet that can’t support the weight, hanging things on walls, carpet that has stains on it that haven’t been cleaned right away. 

Learn more: Rental Property Inspection Checklist for Landlords and Property Managers 

All these things could be identified in a mid-lease inspection that you can fix before it gets a little out of control, or at least then you can give written notices. So when it comes to lease renewals, is this someone that’s going to qualify to renew the lease? So you’re not renting to someone for years, and then they vacate, and then you’re like, “Great, I have $10,000 worth of damage because I’ve never checked up on this property”. So there’s a lot of responsibility as housing providers to set ourselves up for success. What do you think, Brentnie?

Learn more: Common Causes of Damage in Rental Units 

Brentnie:

Yeah, a lot of the comments are basically an agreement. These are generally few and far between situations, and they are very unfortunate when they happen because it does sour the relationship, and hopefully it doesn’t sour your relationship with your future tenants. The reality is that for situations when this occurs, it’s very difficult to recoup those costs associated with reckless or aggressive property damage. Those are rare, but the costs associated with that process are going to be more than you expect. The cost associated with the eviction process alone is just going to dip into your ROI. The costs associated with repairing, excess damage, and the resulting loss of rent is going to be pretty overwhelming for a lot of property owners. 

And then you’re adding the time and the energy and the expense of taking legal action for damages, that’s often not worthwhile because irresponsible tenants, they’re often without assets or insurance or those steadier wages to garnish. And so it often isn’t worth that time and energy and expense. And so the best possible answer really is taking the onus on yourself as a property owner, as a manager or a landlord, formulating a correct and legal and comprehensive tenant screening process for every applicant that you’re meeting. 

I think that the saying that an ounce of prevention is worth a pound of cure is very true here. And that starts with that amazing tenant process where you’re finding great tenants, and you’re creating a great relationship with them. And tenant screening is kind of the foundational process for that, in my opinion.

Kaycee:

Yeah, definitely. Yeah. All about that tenant screening and those routine checkups and having that responsibility down yourself. 

I was also thinking back to the original question of, like, how we get tenants to be responsible for the financial implications of damages that might happen? You can collect from your security deposit, and there are opportunities to send a tenant to collections if they have truly violated the lease and caused damage that is their responsibility. 

And the other part of it is making sure you have the right insurance and that your tenant has renters insurance, and then there’s also a new type of coverage coming out that’s becoming more popular called tenant legal liability coverage, which might cover beyond a renter’s insurance policy or cover the gaps if a renter says they have renter’s insurance and they don’t, or if you require renter’s insurance and they forgot to pay their premium or they let their policy lapse or they just kind of forgot to even sign up even though they said they were going to. So there are different ways that you can kind of build on your protections to at least help with that financial burden if there are different types of damage. 

I’ve had experiences where I had a tenant cause $10,000 worth of damage, but because of our landlord insurance policy, we were actually able to get a lot of that covered because of the type of damage that was done. So the right policies and the right coverage, and then also taking a look at that tenant screening and working with tenants that you feel like are the most qualified through demonstrated responsibility in your tenant screening process.

Learn more: When Renters Cause Damage? My Real Life Story – Video 

I think it is the best thing that we can do because there are great tenants out there who want to have a great relationship with you as well, and maintain a nice home that they are excited to live in for the long term. That’s our goal, long-term tenants that pay their rent on time.