Small Business Brief

Real Estate

A Landlord’s Headache: How to Legally Deal With Terrible Tenants in the US

Can you imagine having a tenant cost you thousands of dollars?

Sadly, this was the case for Frank, a landlord of over 20 years. Unable to reach his tenants about their late rent payment, Frank came by to check up on the property. Pulling into the driveway, it was instantly obvious that something was very wrong.

The rental property’s yard was overgrown, the front door was open, and inside it looked like an abandoned building. It turned out that the tenant had vacated the property weeks ago, leaving behind thousands of dollars worth of damages.

With about 12 million landlords in America, horror stories like this happen all the time. If you’re a landlord dealing with a troublesome tenant, it could end up costing you a fortune. That’s why it’s crucial you know your rights and take action right away.

Read on to find out how to deal with some of the biggest landlord problems.

Types of Bad Tenants

While some tenant issues are only mildly troublesome, others can be a complete nightmare. Here’s a shortlist of the type of common tenant problems that can occur:

  • Late payers
  • Damaging property
  • Unauthorized subletting
  • Lawbreakers

While each tenant issue is different, they all have a similar effect of making your life as a landlord miserable. It may be tempting to feel angry at yourself or the tenant for having to deal with these issues.

Yet, we caution that you do your best to separate your emotions from the business of being a landlord. The less emotion you bring into this, the easier it will be for you to think clearly and create an effective action plan.

Let’s start by creating an action plan for when a tenant is either refusing to pay or will only making partial payments.

Problems With Payment

Landlords commonly have to deal with their tenant making partial payments, late payments, and sometimes no payments at all. Here are the steps, in order, for dealing with tenants who can’t pay:

  • Set ground rules during the lease signing
  • Firmly enforce rules
  • Non-payment of rent notice

You have to be proactive, and anticipate the possibility of payment problems before they ever occur.

Set Ground Rules

The best way to be proactive with payment problems is by setting ground rules during the lease signing. You need to be crystal clear with your tenant when explaining what will happen should they fail to pay. If there are late fees, make sure they know how much and when they apply.

Keep it Friendly

Try telling your tenant that the payment management system you use is rigid and doesn’t allow for late payments. Some landlords will even say things like, “penalties automatically deduct” to avoid any phone calls pleading for more time.

Firmly Enforce Rules

Even when you’re proactive, you’ll still have to deal with payment issues as a landlord. When this happens you have to immediately enforce the late payment fees you outlined in the lease.

You can search online, or use this guide for tenant eviction, to help with drafting a non-payment notice. If after enforcing the late fees the issue still isn’t resolved, you’ll need to deliver a non-payment notice.

Damaging Property

Are you dealing with a tenant that’s causing damage to your home? Whether they’re neglecting the yard or allowing their pets to run the house, a destructive tenant can cost thousands of dollars. Here are the steps for dealing with a tenant that’s destructive:

  • Proactively take photographs
  • Document everything
  • Complete thorough inspection

Sometimes, even after taking every precaution, you can still end up with a tenant that doesn’t respect your property.

Proactively Take Photographs

You won’t be able to prove the damage your tenant caused if you don’t have before photographs. Make sure you proactively photograph both the interior and exterior of the property before allowing the tenant to move in. You should also have the tenant sign off on a pre-move inspection that documents the status of the property when they first arrived.

Document Everything

It might seem silly, but take photographs of every single thing your tenant has done to damage the property. Did they move out and leave a mess of debris behind?

Photograph the debris, and document about how much you’d estimate it weighs. This will go a long way in helping you seek payment for damages if things end up in court.

Complete Thorough Inspection

Of course, you’ll document all of the damage you can see, but what about the less obvious destruction? Make sure you set aside at least a couple of hours to walk through the house, inspecting every inch of the property, inside and out.

Unauthorized Subletters and Lawbreakers

Do you have tenants who are subletting out a part of the property without your permission? Before you do anything, verify that the subletting is taking place. There’s nothing worse than accusing a tenant of something, only to find out you’re incorrect.

Once you’re positive there’s a subletter on the property, you’ll need to reach out to your tenant. We suggest that you email them first so you have a time stamped document showing that you reached out to them. In your email let them know what part of the lease addresses subletting.

Usually, contacting the tenant is enough to motivate them to have the subletter leave. If they don’t stop subletting, you may have to take the tenant to court or mediation.

Taking Legal Action

Remember, waiting for a tenant issue to go away on its own will only cause you bigger problems in the end. It’s up to you to be proactive, get the facts, communicate, and in some cases take legal action.

The type of legal action you’ll take will depend greatly on what situation you’re dealing with. That’s why it’s important for you to be certain of what’s happening, and have evidence to back it up.

Not sure what legal actions you’ll need to take with your tenants? Go ahead and check out our legal section today!