Owning a rental property is a great way to earn passive income. Unfortunately, you run the risk of encountering difficult tenants at one stage or the other. Such tenants seem bent on giving you a hard time through incessant complaints and other debilitating demands. Some may even cause significant damage to your property or consistently pay their rent late.
How to Deal With Difficult Tenants
In the rental property game, challenges always come up. From filling vacancies to maintenance issues, property managers have to tackle them all. One of the most common sources of trouble, though, is difficult tenants. Every property manager has had problem tenants at least once in their lifetime. The trick is to learn how to identify each kind so that you can tailor your treatment accordingly.
Here are the different types of bad tenants and how to handle them:
1. Tenants Who Pay Their Rent Late or Partially
This is the type of difficult tenant that most property managers or landlords commonly encounter. For whatever reason, a tenant might pay their rent late or ask to give you a partial payment first.
It is important that your rental agreement includes all necessary rent stipulations. This includes how much the rent is, when it is due, and when it is considered late. You should include any late fees you intend to charge. This way, you have proof (in the form of a signed contract) that the tenant agreed to the terms of the rent.
Of course, this will not stop your tenant from defaulting on their rent or asking to pay partially. If that happens, you must exercise a firm hand. Let the tenant know that you cannot be lenient about this. You may feel tempted to offer leeway if your tenant is a nice person, but this will only give them the wrong impression. Soon enough, they will find ways to abuse your kindness.
If you need someone to blame, you can always tell the tenant that there is no way around the late fees because of your accounting system. Send a polite warning letting your tenant know that you will take action if they fail to pay their rent by a deadline.
An email works best so that there is written proof. When that day comes, send them a notice of Non-Payment of Rent. Basically, this means the tenant can either settle their balance or move out.
Landlords often find it harder to be strict with their renters, but property managers can usually keep their personal feelings separate from their work. Either way, the burden to pay should not fall on your shoulders. It is the tenant’s responsibility to pay rent.
2. Demanding Tenants
Tenants come in all shapes and forms. While a lot of them tend to keep to themselves, some always seem to find ways to bother you with complaints and demands. A request here and there is fine, but there comes a point when it becomes too much.
Tenants cannot expect you to jump on every minor request, especially if what they are asking for is something that, according to the lease, they should take care of themselves.
However, dealing with demanding tenants can be tricky. If tenants feel like you are not listening, they can grow angry and even threaten litigation. No matter how rude or irritating they are, you must stay calm and answer them in a professional manner. If you let your emotions get the better of you, it will open you up to liability.
If the tenant’s demands are related to maintenance problems or health and safety issues, it is important to check your lease agreement. Your agreement should outline the landlord and tenant responsibilities, making it clear who should take care of the problem.
It is also a good idea to check your state laws. Some states are friendlier to landlords, but most others are friendlier to tenants. Then again, according to the Landlord-Tenant Law, tenants have a right to livable conditions. If your tenant is complaining about something that might interfere with that, then you should address the problem.
3. Destructive Tenants
Destructive tenants are some of the most problematic tenants. These tenants make so-called “improvements” to your property by adding or removing certain fixtures. A standard lease agreement typically covers stipulations on alterations.
In most cases, the tenant must secure the landlord’s approval before pursuing the change. However, some tenants take it upon themselves to make these changes without consulting you. You must assess these on a case-by-case basis.
Other times, tenants will deliberately damage the property out of anger. If this happens, you must send a written request to the tenant asking them to remedy the situation.
Sometimes, the damage will be too severe for the tenant to handle themselves. In other cases, they will refuse to make repairs out of spite. Either way, you can coordinate with your own vendors to fix the issue and then ask the tenant to foot the bill. Your agreement should give you the authority to do so.
Of course, some tenants will argue that the damages were already there when they moved in. This is why it is important for you to take photos of the property beforehand and have the tenant sign them as proof. That way, you have a point of comparison. Conducting regular inspections will also allow you to identify maintenance issues and address them before they worsen.
4. Tenants With Destructive Pets
A lot of property owners refuse to let animals onto the premises — and for good reason. Pets can wreak a lot of havoc. In fact, destructive pets are one of the most familiar tenant problems. Some pets can even cause damages so severe that you will find it hard to land another tenant after the current one moves out.
If you have a no-pets policy, make sure to include it in your lease agreement. It is equally important to enforce this clause strictly. If you do allow pets, inspect the property every once in a while to pinpoint any damages. The pet owner should cover the cost of repairs. Additionally, in some states, certain animals are illegal to keep as pets. California, for instance, does not allow ferrets or hedgehogs, among others.
Keep in mind, though, that the Americans with Disabilities Act allows tenants to live with service animals even if you have a no-pets policy.
5. Tenants With Long-Term Guests
Difficult tenants can also come in the form of hosts, whether it is hosting unapproved long-term guests or as an Airbnb host. It is okay if a tenant wants to let a friend or relative sleepover for a night or two. But, if it turns into a month-long setup, then that is a cause for concern.
First of all, not all states have lax laws about short-term vacation rentals. Florida, for one, has many. Secondly, your lease agreement should have language regulating occupancy limits. The more specific, the better. In a lot of cases, tenants must first clear it with their landlord or property manager. If you find that a tenant is breaking this clause, ask them in a polite but firm way to fix the problem.
6. Tenants Involved in Illegal Activities
It should go without saying that tenants involved in illicit acts are a big red flag.
You should not turn a blind eye to these types of difficult tenants or you risk becoming complicit. This includes the illegal growing of marijuana, selling or abusing illegal drugs, and the like.
If you discover your tenant performing criminal acts, the best thing you can do is to alert the authorities and start the eviction process. Property managers usually know how to handle evictions, whereas landlords may need the help of an attorney.
Why Screening and Lease Agreements Matter
Exercising the proper way to handle difficult tenants will save you from potential litigation and a ton of headaches. In most cases, your lease agreement will protect you from liability.
Therefore, it is imperative that you use specific language in your agreement to avoid loopholes. But, as they say, prevention is better than the cure, and you can spare yourself a lot of time and trouble by screening your tenants thoroughly.
Property managers can help landlords with the screening process. Find the best property management companies, HOA management companies, or real estate companies in your area using Florida Property Management’s online directory.
RELATED ARTICLES: