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April 16, 2024

How to Deal with Bad Tenants

Daniel Berlind
CEO

As a property manager, dealing with bad tenants can be a real headache. Whether it’s late rent payments, property damage, or noise complaints, bad tenants can cause stress, frustration, and even legal issues. In this post, we’ll explore what constitutes a bad tenant, the types of bad tenants and common issues, what to do if you have bad tenants, tenant rights you should know, and tips for avoiding bad tenants in the first place.

What is a Bad Tenant?

Ah, the bad tenant. The bane of every property manager’s existence. This is the tenant who thinks paying rent on time is optional, treats your property like a garbage can, and keeps the entire building up with their late-night parties. Let’s face it, dealing with bad tenants is no fun, but it’s a necessary evil if you want to keep your properties running smoothly.

Qualities of a Bad Tenant

Failure to pay rent

Few things are worse than a tenant that pays their rent late or doesn’t pay at all. The last thing any property manager wants to do is chase after their tenants to get what’s owed. Failure to pay rent can quickly snowball into an eviction, which ends up being extremely time-consuming and expensive.

Causing damage to the property

Walking into a unit to discover that your tenant (or former tenant) has wrecked the property triggers an immediate headache for most managers. Not only does it mean having to spend time and money on repairs, but it also means having to deal with an unhappy tenant who may not take responsibility for the damage.

Subletting the property illegally

Most apartments don’t allow subletting units – and for good reason. Subletting is when a tenant leases the unit to another party without notifying the apartment manager or changing the lease. This party now takes on the responsibility of paying the rent, but they are not officially on the lease. This presents a number of problems, particularly during the move-out process or if there is a complaint against the new party.

Violating the terms of the lease agreement

A good lease agreement is designed to protect the manager and the property from potential problems. Violating the terms of a lease, such as by allowing unauthorized occupants or pets, causing damage to the property, or engaging in illegal activities on the premises, can result in the property manager withholding some of the security deposit or seeking additional compensation for any damages incurred. Failing to adhere to the lease terms could also lead to eviction, resulting is lost income for the property manager and a damaged reputation for both parties.

Being a nuisance to neighbors

As it turns out, most people don’t want to be kept up at night by their loud neighbors throwing a party or dogs barking. This is why most leases include a quiet enjoyment clause, which requires tenants to follow all noise ordinances and respect the rights of those living around them.

What to Do About Bad Tenants

So, what happens when you find yourself stuck with a bad tenant? First and foremost, establish a plan for communication. All interactions should be documented, so it’s best to communicate via email or send a follow-up email after any phone call. This will come in handy if things escalate and you need to provide evidence of any incidents or complaints.

Talk to the tenant – Sometimes, a simple conversation can solve the issue. Explain your concerns and try to come up with a solution together.

Send a written warning – If the issue persists, send a written warning to the tenant outlining the problem and the consequences if it continues. If it’s a lease violation, consider sending a formal 3 Day Notice.

Consider legal action – If the tenant continues to violate the lease agreement or cause problems, you may need to consider eviction or legal action.

Now, let’s talk about maintaining your sanity. It can be tempting to get emotionally involved in the situation, but creating boundaries and staying professional is key. Remember, you’re running a business, not a therapy practice. Use empathy, but don’t let bad tenants take advantage of your kindness.

Tenants’ Rights You Should Know

Every tenant, no matter which state they reside in, has certain rights and protections in their property. These can include:

  • The right to a safe and habitable living environment
  • The right to privacy
  • The right to quiet enjoyment of the property
  • The right to be free from discrimination

One of the most important laws to be aware of as a property manager is the Fair Housing Act. These laws protect people on the basis of the following:

  • Race
  • Color
  • National Origin
  • Religion
  • Sex
  • Familial status (including children under the age of 18 living with
  • parents or legal custodians, pregnant women, and people securing
  • custody of children under 18)
  • Disability

Some states may have additional protections, such as criminal history or source of income. The FHA prevents landlords and property managers from refusing to rent, making housing unavailable, setting different parameters or requirements, providing different services or facilities, or persuading homeowners to rent dwellings by suggesting that people of a particular race, etc., have moved or are about to move into the neighborhood.

The Fair Credit Reporting Act is also relevant to property managers and landlords alike. It states the ways in which a property manager may use a tenant’s credit history for screening purposes. Under this act, the property manager must get an applicant’s permission to run a credit report, provide information on the credit reporting agency used, and inform the applicant if the information contained in the report was the basis for denial.

Each state has its own laws protecting tenants, so be sure to carefully review the laws in your state. Some states, such as California, and considered tenant-friendly and have dozens of laws protecting them. Other states, such as Arkansas and West Virginia, have the least amount of protective legislation and tend to favor the property manager or landlord.

Avoiding Bad Tenants

Prevention is always better than cure, so here are some tips for avoiding bad tenants.

Have a thorough screening process – Conduct background and credit checks on potential tenants to identify any potential red flags.

Verify employment and income – Make sure potential tenants have a stable source of income and can afford the rent.

Be clear about expectations – Set clear expectations in the lease agreement, including rules around noise, pets, and property maintenance.

Respond promptly to issues – Sometimes, all it takes to resolve an issue is quick, courteous communication. Address any issues or complaints from tenants promptly to prevent them from escalating.

To Sum Up…

Dealing with bad tenants is never easy, but knowing how to handle them can save you a lot of stress and headaches. By understanding what constitutes a bad tenant, the types of issues they can cause, and how to prevent them, you’ll be better equipped to manage your properties and keep your tenants happy and satisfied.