How to Deal with a Tenant that Damages the Property?

Being a landlord can be an ideal job. You get to earn passive income just by staying at home, or while juggling with another job. Though it may require a lot of work, it will surely give you financial security. You will just need to advertise your properties, find tenants, and manage them. But just like any other job, it is not always rainbow and butterflies. Being a landlord can sometimes be a headache. There are instances where you need to handle serious things. Such as dealing with tenants who cannot pay rent, tenants who have personal issues or worst, tenants that damage the property. These are probably the landlord’s biggest nightmares and surprising truths of being a landlord. If you are a prospective landlord, how are you going to deal with a tenant that damages the property?

Others may say that there is a simple solution to this problem. Simply screen your tenants carefully. While this may be true, we cannot disregard the fact that damages can still happen no matter how thorough you choose your tenants. Damages can range from simple to major problems. Who should cover the costs? Who will be responsible for fixing it? In this article, you will learn the steps on how to deal with a tenant that damages the property.

How to Deal with a Tenant that Damages the Property?

Investigate the Reason Behind the Damage

The first important step to do once a tenant reports damage is to investigate the reason behind the damage. It is crucial to know how and why the damage occurred. Doing this will help you figure out the next steps to do. Typically, there are two reasons behind damages:

• Accidents – As a landlord, it is not right to jump to conclusions and assume things. Accidents happen and they are inevitable. Just keep the communication between you and your tenants clear on how you are going to resolve it. Sticking to the lease agreement will also be helpful.
• Damages did on purpose – On the other hand, there are also instances where you have encountered a bad tenant. In this situation, the tenant is not taking care of the property and damages the rental property on purpose.

Identify the Severity of the Damage

Once you learned why and how the damage happened, the next thing to identify is how serious the damage is. In addition, you also need to know the type of damage. Is it just property wear and tear? Or is it actual property damage? Knowing the type of damage is vital to avoid any confusion or misunderstanding between you and the tenant. You might have assumed that it is done by the tenant only to find out that it is existing damage.

Make a Documentation

Do not forget to document everything! As much as possible, make thorough documentation and a timeline of the damage. This will serve as your evidence and proof and any actions done and will be done further. Documentation will also help you in case the issue will be brought up to the court.

Know the Law

As mentioned above, damages can happen in two or different ways. As to whether who should be responsible for the damage may differ depending on the state and region. In most areas, it is the tenant who should cover the costs. Knowing the law in your local area will help you figure what to do next in case the tenant refuses to cooperate with you. It is also good to know the law so you will be confident that the actions you are taking or will take are justifiable by the law.

Refer to the Leasing Agreement

So, let us say the damage is caused by the tenant. What should you do next? This time, you need to revisit the rental agreement. Most of the time, there are clauses included in the leasing agreements that tackles what covers the tenant’s responsibility on the property. Talk to your tenant and negotiate. If the tenant is willing to take responsibility for the damage, the issue should be resolved quickly. Besides, the agreement sometimes says that the landlord can take the repair costs from the security deposit. Provide the necessary receipts and proof of the total amount.

Take Legal Actions

Even after all the negotiation and communication yet the tenant is still not taking responsibility for the damage, take legal actions. You can either evict the tenant or sue the tenant for property damage. But of course, with your lawyer’s guidance. He/she will decide what is the best action to do in resolving the issue. This step is the last option you can do if everything still did not work. As much as we wanted to avoid reaching this extent, protecting your property and your business is more important. The same goes for knowing and fighting for your rights. Legal actions might be a complicated and long process, but the authorities may be the last resort and option. Above everything, be sure to stay calm and respectable when handling the issue.

How to Prevent Tenancy Issues

Now that you know how to deal with a tenant that damages the property, here are the things you can do to avoid these incidents:

• Make an inventory of the property – Before you allow a tenant to move in, you need to take an inventory of the property. If possible, along with photographic evidence of the property’s condition. The inventory should indicate the furniture, appliances, and other fixture’s condition and their quantity. Then make sure the tenant acknowledges their current condition before letting them sign the leasing agreement. Furthermore, they should also agree to maintain the condition of the property until the contract ends. In addition, the landlord should have a checklist for move-in and take as many pictures as possible.
• Tenant Screening – Though accidents can be inevitable, it is still important to thoroughly screen your tenants. Perform background checks on potential tenants. You can ask for their rental history and contact their previous landlord, credit score, current job, or any qualifications you think you might need. Doing this can lessen the chances of having bad tenants.
• Perform Rental Inspection – It will also be helpful if you can come to an agreement with your tenant about a rental inspection. For example, have them agree to conduct an inspection once or twice a year. This will allow you to see how they are maintaining the property, or if they do not. If there are also wear and tear in the property, you can immediately take action.

Conclusion

To sum it up, being a landlord requires skills and patience. If you want to be one, need to be careful in every action you make so you can avoid property management mistakes.

DISCLAIMER:

Neither Alpesh Parmar nor Wealth Matters associated claim to be an expert in tax, legal, or insurance strategies. Please consult an expert or advisor.

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