Handling bad tenants is a crucial skill for all landlords, or else they can find themselves losing money, dealing with frequent headaches, or even getting into legal battles.
Most Common Issues With Bad Tenants
When it comes to the worst tenants, here’s what landlords will run into:
- Property Damage – These are the tenants who are more than dirty—they’re destroying carpets, putting holes in walls, and breaking windows.
- Lawbreakers – Is your tenant selling stolen merchandise out of the unit or doing drugs?
- Late Rent or Don’t Pay at All – Late payers require extra time and attention, while those who don’t pay are the worst of all.
- Frequent Maintenance Requests – These are the ones with unreasonable requests, such as pestering you about replacing the carpet or wondering what a noise is.
- No Communication – When you ask about scheduling an inspection or if they plan to renew the contract, they don’t respond.
- Break Lease Rules – They allow guests to stay too long, have too many cars, move in extra people after the contract is signed, or are too loud, among other things.
- Refuse to Leave – The contract is up and they’re still living in the unit.
13 Strategies for Handling Bad Tenants
Landlords who know how to get good outcomes from bad situations will have fewer headaches and more profit in the long run by doing these things:
- Screen Thoroughly
- Create an Ironclad Lease Agreement
- Explain Expectations Verbally
- Document Everything
- Be Rigid With the Rules
- Stay Calm
- Lead By Example
- Offer Incentives
- Offer Cash for Keys
- Raise the Rent
- Evict the Tenant
- Hire a Property Manager
- Get Legal Help
1. Screen Thoroughly
The best way to handle bad tenants is to not give them the lease in the first place. With good screening practices, you can generally uncover who’s going to handle the property well.
Besides the obvious (like ordering a full tenant screening), here’s what the best landlords always do before signing a lease:
- Follow up with all references (employers, landlords, and personal references) and ask lots of questions.
- Have an interview—or at least a good conversation—with the potential tenant beforehand.
- Give them a chance to explain issues on the application, such as a prior bankruptcy or eviction.
2. Create an Ironclad Lease Agreement
A landlord’s lease agreement should thoroughly cover every expectation and rule in the lease itself. Be sure that everything is written in plain English so that your tenants are more likely to understand the agreement.
This helps to both set the ground rules for what’s expected, as well as cover you legally in the event things turn ugly.
3. Explain Expectations Verbally
Even if you create the best lease agreement in the world, some tenants just won’t read it. For this reason, it’s important to explain your expectations in the property.
You probably don’t need to explain that breaking windows is bad, but you should cover things like:
- Pet rules
- Security deposit amount and return policy
- Inspection frequency
- Options to renew the lease (as well as any planned rent increases)
- How many cars are allowed
- Overnight guest policy
4. Document Everything
When it comes to a misbehaving tenant, one of the best things to do is to document their behavior. This way, you can show it to the tenant to try to help them correct their behavior.
Your tenant has a history of noise complaints, but they deny it. You have documented 5 issues in the past year alone. This may help the tenant realize they need to improve, or an eviction may follow.
Of course, the other reason to document their behavior is to use in court, should a legal issue arise or you begin the eviction process.
5. Be Rigid With the Rules
As soon as a landlord looks the other way on breaking a rule, tenants are going to take that as permission to continue on with their behavior.
If a tenant pays the rent late, and the landlord doesn’t charge a late fee, the tenant thinks they can pay late. On the other hand, if the landlord sends a text the day after the due date and (calmly) asks for rent as well as a late fee, the tone has been set.
It’s the same thing with noise complaints, having too many people in the unit, bringing in pets, and more.
6. Stay Calm
It may be incredibly hard to keep your cool and stay rational when confronted with an irritating tenant situation. However, lashing out or retaliating can cause a tenant to dig their heels in rather than work out an acceptable agreement with you—such as a cash for keys situation.
Furthermore, acting rashly could lead to legal trouble for you.
7. Lead By Example
A landlord’s actions can be a great tone-setter for the tenant-landlord relationship. If the landlord’s texts are terse and riddled with errors, then tenants will likely respond the same way back.
If the landlord drags their feet on taking care of maintenance issues, the tenant won’t repay with kindness. If a landlord is overly critical during an inspection, the tenant may withhold necessary maintenance requests for fear of retaliation.
By treating the tenant with respect, and fulfilling their end of the agreement, landlords can help guide tenants in their behavior.
8. Offer Incentives
It’s in most people’s nature to want to punish misbehavior rather than find a way to reward a change for the better.
For example, perhaps a tenant has a history of noise complaints. The landlord could either choose to move ahead with an eviction, or find a way to incentivize the tenant to change.
The landlord could offer $25 off rent each month without a noise complaint. Perhaps do this for six months, and then maybe the incentive will no longer be required (although there’s a decent chance this incentive may need to be in place for the duration of the agreement).
Many landlords balk at this suggestion, but if it helps you avoid eviction and keep a good tenant (besides the noise complaints) around longer, then it’s worth a try.
9. Offer Cash for Keys
Cash for keys means that a landlord pays their tenant to move out of the unit. This is generally used for tenants who have stayed in the unit past the end date. It’s a good solution to a messy, expensive eviction process.
However, landlords can also use this during the lease term. If the situation is so bad that having the tenant leave is better than waiting out the lease, then the landlord can offer them cash to leave.
A landlord could offer the tenant $1,000 cash if they leave within a month, $500 if they leave the following month, or $200 the month after.
10. Raise the Rent
Raising the rent is a good way to deal with tenants that aren’t awful, but perhaps you’d rather have someone else in the unit.
However, maybe you’d be just fine with those tenants if they were paying $200-$300 more per month. Maybe the tenants love the unit and don’t want to leave—perhaps they’d stick around even with the rent increase, and everyone wins.
If they don’t want to pay the increase, the landlord can start over and find a better tenant the next time around.
In almost all situations, rent can only be raised at the end of a lease.
11. Evict the Tenant
Perhaps the most obvious solution, eviction might be the best of a bad set of options. In some places, landlords can evict tenants for any reason at all (no-fault eviction). However, some states are beginning to adopt laws that allow evictions for specific reasons (just-cause eviction).
If your tenant is simply annoying or doesn’t communicate, be sure to know the local and state laws about evictions.
12. Hire a Property Manager
If the tenant isn’t destroying property or avoiding rent, then maybe the best option is to avoid the situation altogether. By handing the reins over to a property manager, you can create distance from a tenant that bothers you.
Also, perhaps a pro can figure out how to keep the tenant from acting out. While property managers usually cost around 8% – 12%, it may be worth it for some landlords.
13. Get Legal Help
While not the most fun option, sometimes landlords will need to understand the law before moving forward with a specific action. Some legal items a landlord might consider are:
- The legality of no-fault evictions (and if the tenant’s actions meet the threshold for a just-cause eviction)
- What might be considered retaliation
- Options to sue the tenant for damages
- What can the landlord deduct from the security deposit
- What certain items might mean in the lease contract