Trouble Tenants - Keep or Push Out?

[Jeff L.]

Hey BP!

Could really use your advice on this one. 

I purchased a duplex property and inherited tenants (a couple) in one of the units. They had lived in the unit for 18 years before my purchase and I have now held the property for 1 year. 

The tenant was paying way below market rate for the unit $600 when I purchased it. During the first summer of ownership i attempted to raise rent (gradually) $100 to a total of $700/mo. The tenants made a huge deal of it and said they were going to be homeless. Since we were nearing the end of the summer (moving season) I offered to give them a break and sign an 8 month lease at $600 to give them time to find a new home. 

The 8 months is now coming to an end. These tenants have been very rude and condescending, but they do take great care of the property. I sent them a letter last week to let them know that we will be renovating the property when their lease terminates, and the rent will increase to $1000/mo. Based on my conversation with them last year, I was sure this would require them to move. However, the tenants have rudely said that they will cut cable, cancel trash service, etc. to stay in the unit and make ends meet. 

Frankly, I would never rent to these tenants because they would not pass my screening criteria. But now that I already have a lease with them, I am not sure if I can require them to go through screening before signing a new lease. My questions are as follows:

1) Would you allow these tenants to stay in the unit at the new $1000/mo rate?

2) Is it legal for me to screen these tenants and disqualify them if I have rented to them in the past? Would it be better to simply not renew their lease and tell them to vacate?

3) Any other advice you have that could be of help. 

Thank you all for your support!

Jeff