Beware Of These Tenants: Advice from A Property Manager

Here is another great article submitted to us that I think you’ll really enjoy and learn a lot from (links in it are for our Real Estate Investor Bronze Members):

In the nine years I have been doing Property Management I have learned that getting the a tenant that will pay the rent on time, and treat rental property with respect is not always an easy task.

First a extensive Rental Application is a must. Everything you can find out about a tenant will help, rental history, employment history, and income for starters. If the applicant is a first time renter, a co-signer is a very good idea.

Here are some of the situations that you could be faced with:

When you show a property, the people tell you that they have all the money for first month rent and security deposit with them and are ready to move in. You tell them that is great, but they have to fill out a Rental Application, they take the application and you never hear from them again. Could be that that if you accept them on the spot, that may have been the only money you would see from them.

The prospective tenants say they have enough money for the first month’s rent and security deposit, however they don’t have a job, but intend to look for a job. Tell them you would be happy to consider them for a rental when they do get that job.

When you hand a prospective tenant the Rental Application, they tell you that they have been evicted more than once, but it wasn’t their fault, and they have a lengthy story. Beware, these are not the kind of tenants you want.

The application shows just that their income is just above the monthly rent, and the prospective renters tell you that it will not be problem. It will be a problem; have them write down all their monthly expenses, and both of you will see that there is just not enough income.

If they are first time renters, go over what is involved in the rental of the property. Young people can be really great, but they just don’t know what is involved and/or expected in renting. Go over what additional expenses and responsibilities that would be involved. They may not be aware that they will have to pay for heat, electric, trash removal and so on.

If you do allow pets, first find out what kind of pet they have. There is a big difference between a small older dog and a Great Dane puppy. If they tell you they work 12 hours a day, but their dog never has had an accident on the floor and sleeps the entire time they are away from home: beware!

The tenants like the property, but want a few changes, like a different paint color (the apartment is off white and they are thinking of red), don’t like the stove, the color of the carpet will clash with their furniture, etc. Again watch out because these people would always be asking for more and may never be happy in your property.

You show the property and there are some things that need repair, The prospective tenants tells you that they can do the repairs if you take the labor and materials off the rent price. Unless you know for certain the tenant can and will do the repairs respectfully decline. I have found that this situation almost never works. The tenant doesn’t get the work done, has taken the repairs out of the rent, if the work does get done it is not what you had in mind and the tenant is offering to do the repairs because he doesn’t have any money

There are many more scenarios, far too many to list here. The bottom line is if you are in doubt, keep listening to the prospective tenant to get a feel of who they are and make sure you check everything on their application. You do have to be aware of the Fair Housing Act, but it is not against the law not to rent to someone with a poor rental history, bad credit, someone with a pet or someone who doesn’t accept you property as long as it is up to code.

You can also get more information about Property Management including an extensive collection of free property management forms exclusively for our Real Estate Investor Bronze Members.

Until my next post,

James

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