A landlord reports that her nightmare tenancy ended with the city ordering her to tear down her rental unit, and a lawsuit for failing to return the security deposit to the tenant.
According to the landlord, the tenant moved in and then almost immediately began to make demands — everything from a different cable service to remodeling the unit. Later, the tenant took over extra space at the property without permission.
There was no written lease agreement. The tenant dictated the terms of the tenancy, and the landlord complied, making concession after concession in an attempt to placate the tenant. Then, the threats began, and the tenant made good on his promise to ruin the landlord financially.
The landlord claims that she ran a tenant background check, but her problem tenant had her fearing for her own safety. How did things get this far out of hand?
Unfortunately, this is not an uncommon scenario. Landlords blame themselves for these bad actors, but in all likelihood, the writing already was on the wall before the tenant moved in.
Understanding the Scope of a Tenant Background Check
Small landlords, particularly those with only one unit, are the most vulnerable to bad tenants. There are a number of reasons for this. A landlord with one or few units simply doesn’t accrue experience as quickly as professional property managers who oversee dozens of units. Often, small landlords are trying to be nice, and become susceptible to manipulative tenants. Primarily, though, these landlords are targeted because they are the least likely to run a thorough tenant background check.
When vetting tenants, a landlord has to verify more than just income. Previous rental history can expose a problem tenant. That vetting begins with the first contact. Tenants who are pushy, make demands, or don’t indicate a willingness to abide by the landlord’s rules are being disrespectful. That will only get worse. Checking a tenant’s credit is a crucial step in tenant screening, but unless the tenant background check also involves speaking to previous landlords and verifying the information in the rental application, bad tenants easily slip through.
The Power of a Written Tenancy Agreement
One of the greatest benefits of a written tenancy agreement is that drafting it requires the landlord to speak with an attorney before jumping into the rental business. Understanding those legal rights and responsibilities before accepting a new tenant can make all the difference between success and colossal failure. Running a rental business without a clear understanding of those rules is like walking through a field of land mines. You’ll get somewhere by sheer luck, but you won’t get far without getting hurt.
The formality of a written lease accomplishes many things. A lease is crucial for enforcing a landlord’s legal rights. Just the act of presenting the tenancy agreement and discussing it with the tenant can prevent disputes later on.
The lease signing process also provides an opportunity to go over the rules with the prospective tenant before the person takes possession. Without it, the tenancy can succumb to personal emotions, and legal problems.
Terminating a Tenancy 101
Many landlords make the mistake of believing they can break off the tenancy whenever they want and kick the bad tenant to the curb. Once a tenant has taken possession of the unit, getting them out mid-lease is a daunting task. An eviction may involve months of legal squabbling and probably will result in income loss.
As bad as that can be, the situation could be much worse. Landlords who do not follow the notice requirements for evictions or the rules regarding security deposits soon can find themselves owing money to a problem tenant.
The courts and tribunals are not going to save the day. Landlords can get beat up in the legal process, and that only exacerbates the income loss. Landlords who experience bad tenancies feel alone, as though no one cares. Those who share their bad experiences light the way for other landlords to avoid these problems. Treating the rental like a business and teaming up with an attorney before accepting the first tenant are two steps that can prevent a nightmare.
This post is provided by Tenant Verification Service, Inc., helping landlords reduce the risks of renting with fraud prevention tools that include Tenant Screening, Tenant Background Checks, (U.S. and Canada), as well as Criminal Background Checks, and Eviction Reports (U.S. only).
Click Here to Receive Landlord Credit Reports.
Disclaimer: The information provided in this post is not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.