Set up a solid Tenant Screening process to avoid Bad Tenants!
The WORST thing a landlord can do is let themselves feel (or be) DESPERATE! DO NOT BE DESPERATE! Be selective in who you rent your property to. Set up a tenant screening system that you will apply to every tenant that shows interest in renting from you. Why? You CAN NOT discriminate PLUS with a system you set expectations, especially if you have a multi-family property. What's a good tenant screening system? Create a one-page Tenant Application Directions form. List the information you want each tenant applicant to provide to you in a Rental Application Package. What should your package include: 1) Tenant Application 2) Proof of Income 3) Copy of Photo ID 4) Background and/or Police Report 5) Credit Report. More information on Tenant Screening HERE.
Set up Security Deposits effectively.
Then claim legal expenses from Bad Tenant Security Deposits.
Make security deposits work for you! No, this does NOT mean trying to keep the tenant's security deposit. That is THEIR money. Instead, use it as an insurance policy, deterrent, and another Tenant Screening tool. How? Set your security deposit to an amount that most Bad Tenants won't be willing to pay. We've seen many landlords charge a $500 security deposit. THIS IS NOT ENOUGH. Commonly, landlords charge one month's rent as security. If possible, we suggest charging TWO MONTH'S security. This will generally be enough to cover the most common tenancy issues like early lease terminations, damage to wood flooring and other expensive repairs that would be the tenant's responsibility to pay. In these cases, consider requiring up front (state it on the Tenant Application) that to move in you require: 1) first month's rent, two month's security. No last month's rent? No. It's in your best interest to hold security and not last month's rent. More on Security Deposits HERE.
Allowing pets? Make sure to require a pet deposit. Puppies can cause LOTS of damage. They can chew on the edge of doors, scratch up glass doors and windows. Older dogs/cats can cause major urine smells that may not every come out of carpets or wood flooring. Always require a pet deposit. Pet security deposits are often charged per pet, and can either be refundable OR non-refundable. Common amounts for a pet deposit are $100 or $200 per pet. For newer properties or higher value properties, pet deposits can commonly be seen as $500 per pet. More on Pet Security Deposits HERE.
YOU'RE NOW STUCK WITH BAD TENANTS.
There are ALWAYS bad tenant solutions. Sometimes the right solution will be in the form of human communication and problem solving. Perhaps you'll need to negotiate an early termination or create a settlement during a Non-Payment Eviction. It's always important for landlords to be familiar with Florida Landlord/Tenant legal remedies and follow them. And in the event of worst case tenant scenarios... have an attorney who specializes in landlord/tenant law help you solve the issue for good.
Communication is key.
Landlords should always be in the habit of documenting everything, and communicating with your tenant regularly. Why? Established regular communication will help keep a good, solid Landlord/Tenant relationship going. It will also make it easier for you, the landlord, to know when there could be an issue. The tenant will either feel more comfortable sharing with you any issues that may be a problem (loss of a job, etc). Or, absence of regular communication with your tenant could help indicate a problem as well. Keep good records of communication with your tenant and make short summary notes on any relevant conversations, reasons/excuses/problems etc.
Make sure to let tenants know AS SOON AS there are any complaints against them: notices/violations/fines, etc. For instance, condos have thin walls. Send them a Courtesy Notice that a neighbor has complained they are playing music too loudly before the situation escalates to a formal Warning or Violation. Keep good copies/records. Why? Complaints can easily and quickly turn into costly FINES. Sure, your lease may stipulate that your tenant is responsible for paying fines. But guess what? The association will go after THE LANDLORD for payment, NOT the tenant!
Note: associations are not legally required to Notice your tenants. If there is a Notice or a Warning or a Fine... they may NOT be posting/serving/delivering any of this information to your tenant! It's very possible they are only communicating with you directly. SO make sure to share ANY related communications from the association, to your tenant right away.
*Tip: as soon as a tenant stops communicating, follow the legal prescription exactly, strictly, timely. Sudden lack of tenant communication is often a good indication that things could be going downhill fast.
We like Courtesy Notices. It's a very fair way of dealing with tenants
and helping to avoid some instances that could otherwise escalate and
become problematic. Courtesy Notices put things in writing, which is
important. And to a tenant receiving one, it is simply a Courtesy and
not any sort of formal complaint, which they usually appreciate. Courtesy notices can be helpful in situations where a tenant was good... and you want to give them a gentle reminder that they can't park their boat in front of the fencing, or their music is too loud, or you haven't received their rent payment yet. BUT don't make the mistake of trying to predict human behavior or how your tenant will act by replacing legal notices with courtesy notices. There is NO WAY to 100% predict if/when a good tenant could turn into a bad tenant! Always protect yourself and follow the legal remedies Florida gives you.
Look to Florida Landlord/Tenant laws for legal remedies.
Get in the habit of serving a Three Day Notice as soon as you can legally. Make sure to adhere to the required number of days, and post or deliver the notice as stipulated in Florida landlord/tenant law. Make sure to sign and date the bottom of the Notice and indicate whether you posted or hand-delivered. Three Day Notices can be easily filled out and served by a landlord without the help of an attorney.
Tenants didn't pay by due date of the Three Day Notice? We suggest hiring an attorney that specializes in evictions, as opposed to using a regular law office that may do an occasional eviction. Why? Law firms that specialize in evictions can do them faster, cheaper, and because they do it all day every day they know the judges, they anticipate all the pitfalls, and they know the timing and system better than anyone. Don't hire your Uncle John who has never handled an eviction. It will take longer and most likely cost you more in the long run. More on Evictions HERE.
Curable Lease Violations?
Got a loud tenant, and complaints from the neighbors? Did they park their boat in front of the fencing overnight? Forget to take their trash bins? There are many things tenants will do that are considered CURABLE... meaning, you'll need to serve them with Notices for each violation. Violations can turn into Fines easily and quickly depending on the association or municipality, or even your own lease. Keep everything in writing in the event the curable violations aren't cured and you need to take further action. If the property is in an association, yes they most likely DO have the ability to evict your tenant for you and make YOU pay for it! SO make sure your tenant is adhering to your lease AND any association rules and regulations BEFORE that association starts sending Notices. Notices will soon turn to fines, and those fines will need to be paid. Bad Tenants won't pay them. It'll be the landlord's balance sheet with lots of new legal expenses tacked on! Be proactive and make sure your tenants are correcting ANY and ALL curable violations or offenses right away.
Bad Tenant Solutions for a move-out like this?
Two truckloads of JUNK to haul away!
Bad tenants can move out and leave you with truckloads of junk to dump. Bad tenants can be hoarders which means truckloads of junk left INSIDE your unit as well. This can be costly.
Landlords should consider adding a clause to their lease indicating expectations for move-outs to include removing all items from the property and dumping/removing all trash. It's also possible to add a monetary penalty. You CAN customize your lease to include bad tenant solutions for common situations like this one.
Beautiful beige walls turned PINK and BLUE!
Bad tenants paint walls without permission.
Deep and bright colored walls are even more expensive to paint over than if you have to simply touch up a white or beige wall. It can get frustrating especially if the security money you are holding isn't enough to cover the expense. As the landlord you may want to consider adding a monetary penalty to your lease stipulating the cost per wall to re-paint in the event the tenants paint a wall without permission and don't return it back to it's original state at move-in. A good amount to start with is $100 per wall as penalty.
This was a new AC unit when tenants moved in. BAD TENANTS never changed the AC filter!
Bad tenants don't change AC filters.
BAD TENANTS don't change AC filters. It's one of the most common AND COSTLY issues for landlords. We ALWAYS recommend adding the size of the AC filter to the lease so it's in writing. AND during the move-in with new tenants ALWAYS show them how to replace the filter, taking it out and putting it back in while they watch. Another suggestion is to provide them with extra AC filters so they get in the habit of changing them. We like to open the package and write each upcoming month on them, to make it easier for the tenants to remember to change them. Write on the side "JANUARY" on one, "FEBRUARY" on the next, and so on.
What happens when BAD TENANTS leave the AC in bad dirty condition at move out? FIRST THING... CALL AN AC COMPANY to go out, inspect the unit, and give you estimates for anything they suggest to remedy. For instance, if it's been three years of one dirty filter, the coil will need to be acid washed. Have the AC tech give you a written estimate for that suggested coil cleaning. YOU NEED TO HAVE REPAIR COSTS IN WRITING. Once you have these costs in writing, you can claim any legitimate costs from the tenant's security. NOT HOLDING ENOUGH SECURITY and under $5k? You can take them to small claims court.
Always take photos of the condition of everything as soon as the tenant moves in. And as soon as the tenants move out.
Take photos of the floors, the oven/fridge/microwave, bottoms of
drawers and cabinets, under sinks, bathtubs, the garage. Take photos of
the AC closet and filter, the AC vents and ceilings. Make sure to take photos (and count) all the
hurricane shutter panels!Take photos of any nail holes or paint chips or broken tiles etc. that you are leaving to new tenants, that is YOUR responsibility and not theirs. You don't want to cause additional problems after move-out by claiming repair expenses for items that the tenants weren't responsible for - it could cause all sorts of additional issues. Be meticulous in keeping photos, and comparing photos between move-in and move-out.
Good documentation IS VITAL if you decide to report tenants, sue them or turn them over to a collections agency. Photos WITH good accurate documentation is the best way to win!
Reporting BAD TENANTS.
Recouping money owed to you. And more...
Most landlords won't have the ability to report bad tenants to the credit bureaus directly. And there's no national database for Bad Tenants (though we wish there was!). But there ARE still things a landlord can do.
1) Small claims court (amounts under $5k). Take all documentation, copy of the lease, and photos to court. No attorneys needed - it's a simple process and the case is decided while you're there. If you show proof of claims, generally landlords win.
2) Seek judgement from a court. Give your documentation to an attorney and have them file in court. If you win, even if the tenants don't have the money now, you become a lien holder and could be paid in the future and/or have an easier time collecting through a Collections Agency.
3) Give your documentation to a Collections Agency. They can usually collect better if there is a court judgement, BUT most will also try to collect with the documentation you've given to them. They will generally negotiate for a lesser amount than what is owed to you, and charge either a flat fee or take a percentage of any monies collected. They will follow and continue to try to collect from the tenants as long as they possibly can. They use skip tracing and other methods to find tenants that you may not be able to yourself. And THEY may be able to report the delinquency to the credit bureaus on your behalf. There are a bunch of collection agencies that work with landlords. We suggest doing your due diligence to find the right remedy for you. Here's one source to check out: www.rentrecoveryservice.com.
FOLLOW THE LAW.
Don't change locks or turn off water or harass bad tenants.
There are always LEGAL remedies to be found for every situation.
Good Tenancies Start with
GOOD TENANT SCREENING practices
and continue with GOOD COMMUNICATION.