No matter how good of a landlord you are, or how great your system is, you will sometimes have issues with a problem tenant. It is up to you to mitigate the issues and make for the best. You must have the ability to recognize the problem, have a solid way to handle it, and have a back up plan it that first plan fails. And you have to be ready, able and willing to execute the plan.
I came across a potential problem on my recent tenant. Here is the scenario.
Problem Tenant?
One of my tenants that moved in recently contacted me to get a rental application for her (soon to be) live-in boyfriend. It was the guy I had met at one of her showings that came along with her. As I have stated in the past, this is a huge red flag. If a boyfriend comes out to see the apartment, he will almost definitely be moving in, no ifs ands or buts. At the very minimum, he will be staying there several nights a week.
I immediately asked if he would be staying there at the showing, and both parties denied it. He would be living elsewhere, for sure, 100%, guaranteed. Never, ever would he live there. Ever ever. Now six weeks after move in, he is already there, and has been. In this case, she was just requesting to add him to the lease now. It also makes it clear why she was willing to leave a larger rent subsidized apartment, for my property at $400+ more a month. It is because she could move in her boyfriend.
I personally do not care who sleeps with whom. I want to know who is staying in my properties, because the tenants who share the multifamily space with them will care. If you are an extra person, I want to know who you are, and if I agreed on a price for a lease condition, and the condition changes, I want to be compensated.
Preliminary Checks Are Important
Luckily I had already found out the boyfriend’s name, and ran a public records check. I did this prior to approving the tenant herself. Had he been a bad character, I would have declined my tenant, as even if he did not live there, he would be around. If a tenant has friends that are bad, sooner or later the friends will be around causing trouble. And the tenant is likely also bad; they just have not been caught. The old saying you are a product of your surroundings is very true.
So, with his background, he is not a bad person, but might have a couple of DUIs. I am not sure of his credit score – yet. He has a steady job, and dresses in a reasonable manner. He does not look like a homeless criminal.
I sent an email to my tenant with an application attached. I said if the boyfriend was approved, there would be an extra $50 per month charge, plus a $40 application fee. This is no different than I do with many of my other rentals. Add a person, add $50.
After my email, there was a bit of radio silence. No returned texts, no returned email, no returned application.
I had another turnover in the same property, so I went over there this week. I spoke with her and the boyfriend in person and explained the application and $50 extra. It will start at the next month’s rent. I requested a few unrelated things about where they had items stored in the basement, which is a common area, and not exclusively theirs.
They mentioned that their email and printers were not working, which is another red flag. They said they had no way to print out the emailed application. I am sure they are hiding a bit of information, and they were hoping the issue would go away. I will drop off a hard copy application for him to fill out this week, and expect it back, along with $40, in a few days.
Possible Lease Violation on My Part?
So, there are a few issues. I raised the rent with only a few weeks’ notice. Typically, you have to do that at the end of the lease. In my case, I have a month-to-month term, so I would contractually have to wait until May 1. If they would object to the short notice, even though the boyfriend is already living there, I would just raise it $100 on 5/1 instead. They have a contractual violation with the extra tenant as well.
If they refuse to pay the extra $50 on 5/1, I will just terminate the lease and evict if they do not move out.
Conclusion
If you have a more risky tenant, use a month-to-month lease. A risky tenant will not honor a lease anyway if you think you want to lock them in for a year. The tenant will leave when they want, regardless of the lease term. Only solid tenant honor leases.
An eviction is almost guaranteed by the courts if there is a holdover, which is staying after you have been told to leave, and it is the end of the lease.
I will take my own advice. “Next time, get better tenants in the first place.”
How do you think this will play out? What would you do? Have you ever moved in a ‘roommate’ without your landlords knowledge?
gosh I don’t know, I usually say nothing as 2 people v one isn’t a big deal, I guess the time to know is to know when they viewed it together. I do not know all the occupancy for all my places, I think a mom moved into one of my units after husband died, I don’t pay water or trash so it’s no bigger expense, I don’t really get all up in their business and everyone thinks I’m the cool landlord, but at the same time there are no criminals and my tenants are going on 6 years there. so I pick my battles, I don’t like turn over, my area is high ticket and wages aren’t keeping up with rents, this is a 2 bedroom, 3 bath, townhome I’m renting for $1,750 month. I don’t charge more if someone moves in because I don’t know and I don’t ask them, I try to stay out of their lives if they are a quiet family. I think tenants like peace, they can’t own and they don’t like strict lanlords. NOW I won’t tolerate messy or noise etc,, but counting people I just don’t do. We all do things different and I think I’ve paid dearly for being nice and I”m definitely not as nice as I use to be. I think raising the rent , fine, say it’s to cover water since you pay it. If credit is ran and it’s no good, then what ???? she’s on the hook for having good credit, what to do ?? if he doesnt’ qualify but isn’t a criminal is it worth throwing someone out, Eviction here is 800, I pick my battles very careful. I’d raise the rent a bit and add him and not run credit, she’s on the hook with her credit.
You are probably right in how you handle it, but I think she ( the tenant ) thinks his bad credit will get her in trouble. I think he was left off the lease in the first place for a reason. again if they’re quiet people just raise the rent and don’t worry, that’s just my opinion.
cheri
I generally do not worry about an extra person. In this case, I specifically asked about him, and was told he would not be moving in. Then, less than a couple of weeks later, he is there. As long as the extra rent gets paid, and they submit the application, they will be OK.
Note to Eric: Print a few extra applications and stick them in your glove compartment. One less trip in this case.
Great point. I have them in my truck, but I drove my car that day… I dropped one off yesterday, so we will see.
Great blog. I am a newbie in here. We see this a lot also – woman with children moves in, few weeks later the “fiance” moves in. Used to be, the man provided for the family. Used to be, that is…
Thank you for the comment!
Extra guests is what I see quite often in lower income families. In this case, it turns out the guy actually works, and has a decent credit score. I will be posting an update to the story as soon as I get the rest of the background checks back. With his income, they are now over $80K a year.
I am always suspect when a changes to the lease conditions happen, especially immediately after the initial move in. That is when things start to happen. Extra guests, extra pets, all the things that “I forgot to tell you” items start to show up.
I hope everything works out for you. We are looking at purchasing a home that we will eventually turn into a rental unit. Stories like these don’t freak me out too much, but when you start hearing about all the different things you might have to deal with it does make you step back and think for a second.
Thank you for the comment!
It is always a challenge, but getting great tenants help a lot. Other than that, it’s simple home maintenance.
one advice I would give you is to make sure 1. you don’t have an emotional attachment to the property and 2. take your time to find the right tenant. If you don’t think you can handle being a Landlord or can’t find the right tenant. Don’t worry, just sell it. You’ll save yourself a lot of headache and stress in the long run
Thank you for the comment!
The tenant has turned out good, the boyfriend was rock solid. I also prefer to wait, in this case the tenant was not a bad one, just more risky than some.
Month to month doesn’t work in all states, especially Florida. If you issue a month to month lease then you need to pay a sales tax. You can go month to month after the first year.
Thank you for the comment and information.
That is the first I have heard of that. For some renters, paying sales tax may be worth it… Maybe you can have a year lease, but either party can cancel with a 30 day notice? It’s the FL way of saying “Welcome” to the tourists and snow birds…
She probably didn’t want to add him as a tenant because he’s father to her children and she’s collecting welfare.
Thank you for reading.
Actually it turns out his credit was OK, a and criminal record not too bad. A DWI is about it. They have never been late, although there have been a few close calls.