fbpx

Our Archive

Welcome to your Archive. This is your all post. Edit or delete them, then start writing!

Buy MI House > Blog >

Renting out one’s property is a lucrative investment for any homeowner. Whether you enjoy the passive income or could use the extra money for mortgage payments, having tenants can be a great help. However, any landlord who rents out their home should be equipped to deal with poor tenants. You probably heard of nightmare tenant stories, from squatters to partiers and everything in between. In this article, we hope to educate you on the most common types of poor tenants and how to deal with them.

Backyard party at night,

Types of poor tenants

Before we begin, we should note that bad tenants don’t have to exhibit extreme behaviors to be considered difficult to deal with. Indeed, your lessee may be pleasant to converse with and great communicators. However, if they’re missing payments or breaking rules, you don’t need to cut them slack. For now, here’s our list of commonly seen poor tenants you may find yourself facing.

Squatters

Every landlord’s worst nightmare is a squatter. A squatter is someone who occupies your property and refuses to leave. While these cases have been blowing up with the rise of Airbnb, squatting is still a possibility for traditional rental relationships. It’s pretty easy to identify when you have a squatter on your hands. If they refuse to leave the property, refuse to let you enter the property, or even threaten to bring you to court, they’re a squatter.

Late payers

Another type of poor tenant is a late payer. These types of lessees are difficult to deal with because they often make excuses or promise to pay soon. They might pay on time for the first few months, but for whatever reason, end up accumulating late payments. Consequently, you may find yourself having trouble paying mortgage and other bills if you rely on their rent. One quick tip is to include specific payment terms in your contract. For example, you may discuss a potential late fee, strike system, or even eviction section.

Party animals

Of course, we all know the characteristics of a party animal. These types of poor tenants will invite people over, play loud music, and risk damaging the property. Your neighbors will likely complain about the noise level, late-night activity, cars taking up street space, and general conduct of these tenants. Indeed, by renting your property to a party animal, you risk good rapport with your neighbors among other consequences.

Open-shelter tenants

This class of poor tenant is more difficult to identify. If you visit the home and notice common areas were made into makeshift bedrooms, and that there’s more people than you signed onto your lease, you’re dealing with an open-shelter tenant. These lessees typically offer a place to stay for friends and family either for free or a percentage of their monthly rent. This essentially means you’re losing money because more people are covering a smaller rental rate.

Animal lovers

These types of poor tenants mainly affect landlords with a strict no-pet rule. However, the consequences of pets can eventually damage any property. If a potential lessee asks whether pets are allowed, they likely have one. After they move out, you may have to make property repairs to fix bad odors or unclean carpets.

House destroyers

Finally, the last common type of poor tenant is a property destroyer. These people may either make unnecessary bad repairs to the home, or fail to maintain it. The bathroom and kitchen may develop mold, the screen door may be broken, the lawn may be in shambles, etc. On the other hand, you might notice an attempted construction project on a wall or doorframe that never got finished. These tenants destroy the house during their lease, leaving you to drain money into repairs.

Protect yourself against poor tenants

Before signing a lease with any potential tenant, you should take these mandatory precautions. During any rental contract, you should also take steps to keep your tenant’s behavior in check.

Always screen your tenants

Screening everyone is absolutely mandatory to ensure you won’t deal with poor tenants. This includes a background check, a credit check, and verifying income. Actually, the rule of thumb is that a tenant should make at least 3 times the amount of their rent every month. In addition, contacting their previous landlords gives you insight on their past behavior as tenants. This is good for raising red flags early. Don’t know how to properly screen potential tenants? Avail has a great guide to tenant screening that you’re encouraged to check out.

Set rules in your contract

Be prepared for any potential problems by setting rules. Don’t want late-night complaints from neighbors? Set a mandatory quiet hour or curfew. Want to lessen the damage made on your property? Outline your lessee’s responsibility to property maintenance. After this, you should set consequences such as a strike system or end-of-lease agreement. By setting rules beforehand, you are able to act on their poor behavior if it happens. Remember, it’s vital that you get everything in writing and have it signed by the tenant. This makes your contract legally binding. If you need somewhere to start, check out Nolo’s Ten Terms to Include in Your Lease Agreement.

Be strict

Once you outlined all your terms in the lease agreement, stick to them. Don’t let late payments, rule breaking, or other poor behavior slide. By sticking firmly to your rules, you send the message that you’re not playing around. If they break an agreement, carry out the agreed-upon consequence.

Evict when necessary

In addition to the previous note, don’t be afraid of eviction. If you and your tenant signed to uphold a contract, you are legally able to evict them if certain rules were broken. Remember, a lease is a 50/50 relationship. If your tenant isn’t acting accordingly, you are within your rights to end that relationship. If you need a refresher, Landlordology offers a step-by-step guide to evicting tenants.

Reach out to us!

Sometimes it’s too late to act on the damages a poor tenant leaves behind. If your tenant left behind a weird odor, property damages, and other high-cost repairs, consider selling your home to a house-buying company. House-buying companies will purchase your home off you, unmade repairs and all, for a fair cash price. Do you live in or around Macomb County, Michigan? Deal with us! We’d love to check out your home and do business. For a fair cash offer, visit our home page. For any other inquiries you may have, feel free to call us at 586-200-1710.

Read More

Renting out one’s property is a great real estate venture when looking for a continuous source of passive income. However, at some point, a homeowner may decide it’s time to fully sell that property. This could be for any number of reasons; perhaps you are moving far enough away that it’s become a burden to maintain the property. Perhaps you are comfortable financially and don’t want to deal with the hassle of tenants. Whatever the reason, selling one’s rental house is common and easily achieved when done correctly.

But one question can’t be ignored: how do you do this when your property is currently being leased?

Many homeowners face the reality of needing to sell their property while it is occupied. This can be tricky territory to maneuver, but worry not! When conducted in a reasonable and professional manner, you should find the process can be quite stress-free. Here are our tips for selling your rental property during an active lease.

Two people signing a contract.

Options for selling your rental property during an active lease

There are a number of routes you can take when choosing to sell your home under an active lease. Here they are:

1. Wait until the lease expires

This is the most obvious option, but also potentially the longest and most inconvenient for you. While you are avoiding problems with tenants by waiting out their lease, this can be lengthy and time-consuming.

2. Search for an owner who will also rent out the property

Selling your property to a new homeowner who will also rent it out can be beneficial both to you and the current tenant. The tenant’s lease will then transfer over to the new landlord, who must abide by the old contract’s same rules and agreements. If you’re not under a tight time crunch, this is a great option for all parties involved.

3. “Cash-for-keys” agreement

This is a commonly practiced method whereby you will essentially pay your tenant to move out sooner. This can be done in a number of ways. Negotiate with your tenant; perhaps you can pay their security deposit, or provide moving services. Whatever the case may be, the objective is basically to incentivize them to leave. When done civilly, this can be a clean and easy way to end their lease early.

4. Sell to the tenant

If the tenant has lived there long enough, or the location is too convenient to let go of, they might just be interested in taking the property off your hands. When you first begin the process of trying to sell your home, be sure to keep the tenant adequately updated. They may end up becoming the buyer if you provide them with a timely notice.

5. End the lease if the tenant has violated the agreement

Unlike the cash-for-keys agreement, this particular method can be a bit messier. If your tenant has clearly violated the lease, you are fully within your rights to terminate the contract and move forward with selling your home. Remember that there are legal statutes which oversee these exact situations. Inform yourself on the procedures of evicting and what notices need to be made before you take this matter on.

Additional tips

As you just read, there are a number of methods you can adopt in order to sell your home during an active lease. In addition, here are a few crucial behaviors you should practice to ensure that the whole process is clean, clear, and mess-free.

A homeowner and leaser having a conversation.
  • Be communicative. To prevent any unnecessary arguments and misunderstandings, the landlord should be as open and communicative about the process as they can be to the tenant. You don’t need to update them on every single step and every prospective buyer. However, you should give fair notices and answer any questions. This will quell their own fears and confusion about the situation, leaving you both happy, informed, and prepared.
  • Be firm. Additionally, it’s important to remember why you are selling your rented property. Regardless of how the tenant feels, you are still on a schedule. While negotiations with your tenant can be done during an active lease, remember to keep the goal in mind: to sell the home.
  • Get everything in writing. Throughout the entire process, be sure to get all agreements officially signed by both parties in clear-cut, legal writing.
  • Remember tenants have rights. Our legal system has ensured that both landlords and tenants have certain property, privacy, and other rights. Before you embark on any ventures during the selling process – especially when it comes to entering the property – be sure to understand what your legal boundaries are by staying informed on tenant rights.
    • Rule of thumb: When showing the house to prospective buyers, give tenants a fair warning. You are legally obligated to notify them 24 hours before entering the home. Generally, it is better to set up specific, agreed-on dates and times with your tenant for house-showing.

Avoid the hassle of looking for a buyer

Want to know the quickest, cleanest way to transfer ownership of your property? Work with a house-buying company! These local businesses will buy homes off you for a reasonable price – no realtor needed. When working with a house-buying company, you can forego the stress of repairs, updates, and paperwork, all while knowing you are receiving a fair price for your home.

For more information, be sure to scour our website and contact us for any questions or proposals!

Read More
×

You're just a form away from getting a cash offer for your house. Just fill out some basic information below and let's get started!