I’ve got a vacant rental property that I’m having a hard time getting rented because, well, it stinks. The previous owners had pets, that I regretfully allowed, and they were smoking in the house which was prohibited in the lease. I had the carpets cleaned and they used every product they had but the smell is still awful. If I had to do it over again I would have just replaced the carpets but $275 for the cleaning has me holding out for now. I go over and open the house up every day but the smell still lingers and prospective tenants are walking away. I screen all my tenants thoroughly and they passed my criteria but sometimes things happen in one’s life that has them behaving out of character.
This particular tenant moved out and left her teenage daughter to live there on her own for 6 months. Any red flags there for anyone? Things like this can happen to anyone and it could be worse. I have been made fully aware that I had bad tenants despite my efforts to screen thoroughly. Now I need to determine the actions I need to take to fix the problem because a vacant rental is bad news for cash flow.
How to Deal With Bad Tenants
1. Brush up on your state and federal landlord/tenant laws to ensure you are fully compliant. The laws are always changing so be sure you are in-line with current laws. The comprehensive landlord software I use does actually notify me when laws have changed which has saved me countless hours of researching. The majority of the laws are geared at protecting tenants so it’s important to make sure you are acting within the law.
2. Negotiate with the tenants to try to get them to do the clean up and repair work before they move out. Most tenants want to try to keep some of there deposit and definitely don’t want to incur debt in a court proceeding. I’ve decided not to try to collect for damages beyond the security deposit in my current situation because I think it would be more trouble than it is worth.
3. In my current situation the tenants have moved out but in many cases it is a struggle to get the tenants to vacate the property, if that is the case you are dealing with then you will have to file for an eviction. Filing for an eviction often makes tenants upset and even more damage may occur. With legal fees and costs to repair damages you can easily see costs in the 5 digit realm.
4. Having a licensed collection agent in mind is smart. They are able to help figure out how to go about legally collecting for damages. It’s a good idea to get in contact with a reputable agency as soon as you know that your costs will exceed the security deposit and you will need there service.
How To Keep It From Reoccurring
I’ve said it before and I’ll say it again, your best defense against bad tenants is to establish a strict tenant screening criteria and follow it. Collecting as much information about prospective tenants will give you the best idea who you are dealing with. The list below is the information that I always collect.
Employment information: I like to collect at least three months of pay stubs. You should also call there employer to verify they are currently working and while you have them on the line you might as well check to see what their opinion of the individual is.
Debt to income ratio: Ensure that they will they be able to pay rent.
Credit check: A credit check can reveal a lot of information about how a person handles there finances.
Contact numbers: I require phone numbers of employers and applicants, email addresses and at least one emergency contact number.
Landlord references: Call the previous landlord and ask if they would rent to the tenants again. That gives you a pretty good indication of how they left the property when they moved out.
Criminal background verification: Checking to see if your prospective tenant has a criminal history can tell you a lot about there character.
Eviction Information: Running this report is a great idea for obvious reasons.
Social Security Verification: Verifying an SSN is a cheap way to ensure that the prospect is being honest about who they are.
Bankruptcy Report: Collecting this information will show debts that may not have come up on the credit report.
Sometimes a bad tenant will slip through the cracks despite our best efforts but stay vigilant and keep screening. Good luck and please let me know if you have anything to add to the list or if you have had similar stories you would like to share.