The kind of tenants you have can make or break a property management business. Bad ones cost time, money, and a great deal of sanity, and a string of them can put you in a considerable hole. Problem tenants are an unpleasant inevitability in property management, but there are some practical and efficient ways to avoid them altogether.
Property management isn’t just about keeping your tenants happy. You also have to know how to deal with problem tenants in ways that minimize the collateral damage. The best way to avoid flaky-tenant issues is to identify the behavior and employ countermeasures.
Tenants can cause significant damage to your business with payment issues, unwillingness to maintain the property, untrained pets, and excessive parties. Here’s a look at those and other types of problem tenants and how you can avoid them.
6 Types of Problem Tenants
Some tenants make a property manager’s job far more challenging than necessary. Identifying them as soon as possible helps head off any problems before they start. Here are the most common types of problem tenants:
Non Payers and Late Payers
The typical type of bad tenant is the nonpayer or late payer. They are also the most troublesome and usually the most expensive. Property managers depend on complete and timely payments to run an efficient business. Consistently late or missing payments can have critical repercussions for the company.
Subletting and Airbnb
The popularity of Airbnb has many tenants playing amateur real estate agents, allowing untold strangers access to your property. Long-term subletting is another problem. Both have legal repercussions for the property manager if something goes wrong. Along these same lines are the tenants that have perpetual houseguests. A constant revolving door of guests is an open invitation for trouble, from property damage to neighbor issues.
Tenants who destroy property are another common pest for landlords. Regular wear and tear is expected, but many tenants violate their rental agreements by how they treat the property. Unapproved improvements such as painting and shelving are an everyday occurrence, albeit an annoyance. It’s when negligence and property abuse occur that the real problems start.
Negligent Pet Owners
Many pet owners are overindulgent, allowing their animals to run rampant, while others hoard animals, owning three, four, or more. Such a property can be challenging to rent after the tenant and pets move out, especially if the owners were negligent. Damage from urine, chewing, and scratching is challenging to repair and highly costly.
Every landlord has at least one or two experiences with lawbreaking tenants in their career. Some grow marijuana or sell narcotics; others throw loud parties and get drunk on the front lawn. Common screening methods don’t always catch these bad tenants, and you are left dealing with the consequences.
Some tenants are barely on your radar. They are quiet and pay on time with hardly a word in between. Others are the exact opposite, and a day doesn’t go by that they don’t call with a complaint or request. This type of tenant can be a serious time waster and a constant aggravation.
One screening method alone cannot catch every type of lousy tenant that crosses your path. It’s crucial to screen applicants in a variety of ways to cover all your bases.
How to Avoid Problem Tenants
The number one rule in dealing with problem tenants is to stick to the hard line. Don’t deviate from the lease or allow any concessions. Taking a lenient approach when things start to go wrong only exacerbates the problem. Here are some efficient ways to avoid getting problem tenants on your property.
1. Credit Screening
Checking an applicant’s credit report shows how well they pay their bills and miss any payments – critical information for a landlord.
2. Eviction Screening
Run an eviction report to see if the applicant has been evicted through court action in the last seven years. This information goes a long way in heading off nonpayers.
3. Verify Employment and Income
Asking for pay stubs is one way to verify the employment status and income of a potential tenant. It’s imperative to have positive proof that the applicant has steady employment with enough income to pay rent.
4. Get Landlord References
Figuring out whether you have a real landlord on the other end of the phone can be challenging, but talking to previous landlords is a must when screening applicants. Credit and background checks are handy, but a first-person perspective is invaluable.
5. Collect a Security Deposit
6. Provide an Airtight, Crystal Clear Lease
The lease is your biggest weapon against unruly and unscrupulous tenants. Make sure it contains all the rules, stipulations, and obligations in simple, straightforward language. The easier it is to understand, the harder it is to argue things like pet policies, smoking, and late fees in court.
7. Spot Check
Pop in for unannounced spot checks to make sure the tenants are not violating the lease terms. Many states have laws regarding tenant privacy, though they often require at least 24-hour notice and have other restrictions. Many states allow a landlord to include language in the lease that provides for a specified number of spot checks per year. Be sure to check your state’s regulations.
Dealing with bad tenants is part of being a property manager, but that doesn’t mean it has to ruin the experience. Effective screening and research can weed out a lot of the bad apples.
The Screening Pros With Answers You Need
The screening process is a vital tool for avoiding problematic tenants. Rent Safe is a digital service that helps renters easy-submit their applications for rentals through an online portal and enables landlords to streamline the steps to screen potential tenants.
The Rent Safe software allows transparency for both parties to see at a glance where they are in the application and screening process. Contact our team to see how our platform can help simplify your rental applicant screening processes.