Eventually, it happens. You run into your first bad tenant which leads to a tenant eviction. Unfortunately, this usually happens more often in your beginning years as a landlord. Right when you have the least extra cash flow and the most faith in humanity.
Now, not to say it happens to everyone and not to say all hopes for humanity are dashed, but the first time you run into a tenant that has no qualms about not paying you, leaving a mess behind and simply carrying on with their life, is the time you start doubting why you are in even in this business.
Fortunately though, I have some tips to help you either avoid that first let down, cut down on the drama associated with it and save you some headaches. Would you like to find out about them?
Tenant Eviction Lesson One
A breach of your lease is serious business. Whether it’s non-payment, damage to the property or something even more serious. Because it’s serious, you need to take serious action and make sure a) the tenants know this isn’t how it works, and b) you need to start taking the appropriate action to evict the tenants.
One of the biggest issues I see with new landlords is they end up being compassionate, often too compassionate and the one month’s outstanding rent ends up becoming two or three month’s outstanding rent and then the landlord discovers it can take an additional one to three months to get a tenant out.
What might have been a $1,000 decision now could be $6,000, with little hope of ever collecting.
You’re far better off being serious, starting the eviction and then canceling it if you do manage to get paid, rather than hoping the tenant comes through. The other important point from this is it sets the precedent.
If the tenant sees you won’t let them get away with non-payment or any other breach, they will see you treating this like a business and hopefully not let it become a pattern. Now, when it comes to non-payments in my locale, if the tenants pay before the date they are to be out, the eviction becomes null and void.
I tell them this and I also explain I am doing it to cover my ASSets. If they make the payment, no harm, no foul. If they don’t, I am already well into the process of having them removed.
Now I mentioned these are lessons I learned from my first eviction, this is an example of something I learned afterwards. I expected other people to be like me. Honest, respectful and that they would honor their commitments. I was wrong and ended up evicting these people a couple days before Christmas back in 2004.
I then spent the majority of my Christmas break, which I intended to spend with family, repainting a property, fixing holes in walls, repairing damages caused by neglect and cleaning floors, counters and bathrooms. All on a property I had just finished doing all of this less than six months prior. Don’t learn the hard way like I did!
Eviction Lesson Two
Tenants lie. Now don’t take this as a blanket statement, but when it comes to someone facing an eviction and the possibility of living on the street, making up a small fib about paying the landlord doesn’t seem so bad.
You want to believe them, but you’re running a business and you need to remember that. Accept what they are saying at face value and move forward with the hopes that they come through and many often do, but at the same time, don’t delay moving forward with an eviction or with the appropriate steps to take control of your property back as quickly as possible if it goes sideways.
This lesson was first introduced to me when I was continually promised a payment and wanted to believe them, but I was ultimately let down. Over the years this has been reinforced many times by people I have tried to help, only to discover no one was helping me, they were just looking out for themselves.
Eviction Lesson Three
Regaining control of your property should be your priority. When you get caught up in evicting a tenant, it often becomes about the outstanding money. This is understandable, especially if it’s several months rent that never made it to your bank account.
Don’t get caught up in the money because the reality is you will likely never see it. If things are so tight for them they cannot pay rent, where will any extra money to pay you back come from? That’s why it’s so important to take immediate action; the longer you wait, the more you can be out.
Your priority should instead be to get back control of your property so you can once again turn it back into a positive cash flowing situation. Focus on getting the tenant out as quickly as possible using the rules and laws in place in your area.
Some places this can be tougher, some areas are definitely pro-tenant and the process can be long, slow and unfavorable to you as a landlord, but bottom line is your goal should be to get the tenant out and the property back in your control.
In my case, I was able to get my property back just before Christmas and that gave me the gap between Christmas and New Years to get it repaired, repainted and re-rented and in our case, I had it rented out within the first week of January. I went from losing money every month the tenants didn’t pay to having it rented out again with cash once again flowing in the right direction.
It’s important to remember, once you have control, you have so many more options. You can get any renovations or repairs done if they are needed, which usually doesn’t make sense to do when the bad tenants are still in place. You can decide if this landlord business is right for you or not and either get ready to find better, more suitable tenants for the next go around, or you can start preparing to sell.
But many of these decisions are delayed for you unless you have control of the property and get those tenants out.
Eviction Lesson Four
Knowledge is power. Understanding the steps involved in evicting a tenant is actually very powerful and many landlords I’ve walked through the process with locally, tell me it’s actually empowering.
It’s human nature to be fearful of something new and the first time we have to go through the process of evicting a tenant, it’s not only a new experience, but also very stressful.
Your mind is filled with concerns your property will get destroyed, you’ll never be able to get the tenant out and that it could potentially cost you a fortune. All with the pressure of not knowing when or how long this could go on!
Granted, in some areas the process is much easier than others, but learning the process early is much simpler than having to do it under the pressure of a time sensitive eviction.
So where do you get this knowledge?
You can start with some of your local government service offices. They often have a consumer landlord tenancy agency or hotline that can provide you some information. It is usually the extended bureaucratic version, but it provides a starting point.
From there you might want to research local apartment or rental associations for landlords. They can be a great resource for first time landlords. They also should have tons of information regarding evictions, leases and everything in between that you can use to improve other areas of your landlord business.
The majority of these associations require memberships for complete access, but they often have lots of free information to help you move forward.
Finally, seek other landlords in your area. Networking with other landlords can be very advantageous for everyone involved. Locally, it can provide you with changes in local laws or upcoming new rules. On the bigger scale, it can be a resource for you to learn and make the job of being a landlord easier. (Never mind the opportunity to share this website to your new associates!).
This is part of how I learned to do my first eviction. I was a member of a local real estate group and sought out several of the members to get some guidance. By networking independently of the group, my wife and I formed some life long relationships with some great people who we are glad to have as friends and fellow landlords.
Knowing how to evict a tenant isn’t knowledge you really want to have, but if the situation comes up, you’ll be happy that you do have it.
Eviction Lesson Five
Keep an eye on your property, especially the days leading up to the eviction date!
Depending on how the eviction went, you could end up with some vindictive tenants, after all, it’s never their fault they couldn’t live up to the agreement they signed with you, it’s only your fault for evicting them.
One of the ways they can be vindictive is to leave all the doors and windows open when they move out in the dead of winter. Much like my first evicted tenants did. The patio door was left wide open too along with every light on.
Now back then I didn’t know to check out the property earlier (and sometimes the damage is already done by the time you get there) and we were lucky enough the downstairs tenant arrived home to tell us about it. Before he called, he went through and closed all the windows, turned off the lights and closed the door(s).
I now warn landlords to even just do a quick drive-by of their property leading up to the day the tenants are supposed to be out, or in the case of a suited property, I keep the other tenants in the loop as to what is going on so they can be my eyes and ears on site.
If you’ve also established good relationships with the nearby neighbors, you can let them know what is happening as well. Some landlords become concerned that the other neighbors will think less of them for having a bad tenant, but more often than not they respect that you are taking action and keeping them informed.
Your property is a huge investment and spending a little time driving by, chatting with the neighbors and keeping other tenants in the loop just helps you protect your investment.
Well, there’s probably another half dozen warnings I could throw your way, but consider the lessons above as your priorities. Of course, much of this can be avoided by making sure you screen your tenants diligently before you ever hand out keys. From there you also want to make sure you have a [signed] written lease that’s valid for your area. It’s another pitfall that new landlords fall into. Without a written lease, you leave far too many loopholes that a bad tenant can take advantage of, so make sure you have a lease and again, one of the networking groups is a great place to look for these.
They may not be perfect, but they are a starting point.
[Editor’s Note: Be sure to use AOA’s low-cost screening services and up to date rental forms designed for your protection!]
Bill Biko has become “the Educated Landlord” through both training and the school of life. With almost a decade’s experience of landlording, Bill’s been mentoring and assisting landlords for the last five years and you can find more of his tips and articles to make your life as a landlord easier, more profitable and less stressful at www.TheEducatedLandlord.com.