As the owner of an investment property, tenants are your lifeblood. So the last thing you want is a thorny relationship. After all, they are the ones providing you with income. But if you do find yourself stuck with difficult tenants, consider the following:
Tip One: Check Their Background
The best way to cope with bad tenants is not to rent property to them in the first place. Therefore it’s recommended you use a thorough screening process. Run checks on: their background; their employment status and especially their former rental history. However, if you’ve ended up with difficult tenants it’s still worth running background checks. You should contact their previous landlords. They may have advice on how to deal with them.
Tip Two: Keep It Civil
When you have a bad tenant who doesn’t pay rent; damages property and is rude or nasty, it’s easy to get angry and emotional. However, make sure you always stay civil and don’t inflame the situation. Firstly, you won’t help matters and the tenant’s attitude will only get worse. Secondly, if you start getting abusive or taking matters into your own hands, you could wind up in court.
So while landlords changing the locks on a difficult tenant sounds great it in the movies, it’s actually illegal and you’ll get into lots of trouble if you do this. Keep calm at all times. If the tenant gets rude or aggressive then go through a third party like a real estate agent. It’s generally a good idea to have a third party present at all confrontations so you have a witness should matters escalate. So staying matter of fact and calm will definitely help your cause.
Tip Three: Know the Law
State laws are very strict about wrongful eviction. There are also clear rules and regulations about what your rights as a landlord are. Make sure you’re absolutely on top of them and that you follow them to the letter. Often difficult tenants can be quite litigious and won’t hesitate to take you to court. So by being certain of your state rights and responsibilities you’ll have the ammunition to deal with any hostile situation that could arise.
Tip Four: Nip It in the Bud
There are early warning signs you can read. If you’ve got a tenant who’s consistently late in paying rent or one who is constantly damaging property – you should record all your communication with them from early on. If they are giving fanciful excuses that don’t seem legitimate you can take the matter to a rental tribunal or the Fair Trading Department. Each state has it’s own laws regarding eviction for late payment of rate. Find out what the law is in your state. If you’ve got a tenant who’s fallen behind in arrears for a considerable amount of time, it may be best to get rid of them before the matter gets worse.
Tip Five: Make Them an Offer They Can’t Refuse
If all else fails and you have the tenant-from-hell who simply refuses to leave and is behind in rent or causing damage to the property, consider offering them an incentive. Remember that your property is an investment and you need income flowing in. However, just like an off plan property, you are removed from it and can’t always control what’s going on. Sometimes it’s worth cutting your losses rather than getting into a protracted legal battle.
If you have a really horrible tenant who’s out to make your life miserable, then definitely consider this option. You could tell the tenant that if they leave within the week you won’t take them to the rental tribunal and will waive their outstanding arrears. At least this way you’ll be shot of them and will have learned the hard way about how to choose next time.