Having a heart in business sucks sometimes

[Matthew Kelley]

I’m sure a similar question has been posed in the past but I’m struggling with this. I feel I know the answer is simple but having a heart sucks in business sometimes..

I’ve been renting to a gentleman who is a single dad. His son ended up leaving going away to college. He’s been struggling paying rent on time. I’ve kept everything business like and filed for eviction 7 times in the past two years for non payment of rent. He’s always come up with the money and paid all the fees. His lease expires in February and I sent him the non renewal of his lease letter and that he must be out.

This is a multi family house that I reside in the other side so it allows me the right to not renew a tenant. 

After receiving the letter and realizing I wasn’t renewing his lease he told me he didn’t have the money to put down for a new place or have the money to move. He’s such a nice guy and I’ve been sooooo understanding throughout the last two years. 

What would you do? 

I ultimately want to renovate that unit and get a better return and know evicting him is the best option to ultimately go. How would you go about doing it? 

[Jim K.]

@Michael I Kelley

We all know what caused the mortgage crisis. Banks made a special dispensation to loan to subprime borrowers, people who were clearly unqualified to assume the loan burden they were taking on. And because the banks did it en masse and profited off it, it's known as "predatory lending." We castigate the banks because they enabled people who should not be enabled.

Well, what are you doing?

Let's look at your tenant. In the last two years, conditions have been such that you've filed for eviction seven times. Does this sound like a guy who's really able to pay the rent? Or a guy who clearly needs a cheaper place to live?

You could drop your rent to charitably accommodate this gentleman. That would be the humane and decent thing to do if you really want to do right by him, if you chose to invest in this tenant. Get that rent down to a level that he can really afford. Otherwise, what you're really doing is leading this guy from money crisis to money crisis. Making his life miserable. Not giving him the chance to regroup, put aside some savings, start changing his life.

So...no, you're not willing to do that? You feel that it's your asset and you should be able to charge market rate for it? You want to improve the asset and charge even more for it, thereby improving the neighborhood, thereby structurally improving the community and doing good that way? Not willing to pay a neverending compassion tax specially put in place for landlords to pay and no one else? Do you want to follow a system to help your community that has been proved to work a million times over (capital investment in a community increases the value and tax base of a community) and not follow a system that clearly isn't sustainable (unstructured charitable handouts)?

Do you want to continue as you have and hope for the best? Again, you really are just making this guy miserable, jerking him along from crisis to crisis. He is unable to systematically afford your rent. He simply doesn't have the income with his lifestyle. Are you willing to help him alter his lifestyle to make better use of the money he has (very low probability of success) or teach him how increase his income (also very low probability of success)? Ready to turn life coach for a grown man with a son in college?

Because as I see things, if this guy had the life skills and the courage he needed to get by in this world he would already have come to you and explained his situation. He would be making active efforts to find a roommate if he really wanted to stay. Or he would be out already. This guy is clearly unable to manage his finances, clearly lacks the tools. Does it take a genius of self-realization to come to the conclusion that SOMETHING HAS TO CHANGE, after getting seven eviction notices in two years?

How do you know that getting him out won't be the impetus that actually motivates him to look hard at his finances and get some financial education, finally? Well, you don't. You do know that stringing him alone, as you have, hasn't worked seven times in a row. You realistically have overwhelming cause to believe that doing nothing and hoping for the best isn't going to change anything.

I agree with @Darius Ogloza. Give him a free month's rent and pay for movers to get him out and go live somewhere else.

Sometimes, people have to run up against the limits of society to realize that it's time to change. Sometimes, people have to hit rock bottom before they realize which way is up. Stop getting in this guy's way. How old is he? 50? When will it be time for him to start behaving like a grown man who takes care of his own business and not cry and whine for Daddy Landlord to change his diaper and powder his tender bottom?