How can I get my credibility back with a tenant I hired ?

[Kimberly Kesterke]

Well- despite all of the advice against it, I hired one of my tenants to do some basic property management work. He wanted work and I needed some help - pure and simple. You know how hindsight is 20/20? Well, I'm going to share some things in this post that make me cringe- and yes, I agree with you on the front end.... I was an idiot. But I would like advice on how to get my credibility back after the classic mistake of commingling business with a tenant. 

Long story short, I have a tenant in one of my properties who I trusted. He and his wife paid rent on-time, he seemed like an honest guy and I really needed a new team member to help be my "boots on the ground". Being an out of town landlord, I needed someone to help keep contractors straight, help pick up supplies and keep the jobs running. Basically I needed a project manager, and since he claimed to have helped real estate investors in the past, I felt like this could be a successful partnership. 

Cringe-worthy mistake #1: I sent over a business credit card for him to use for supplies 

(yes, I'm an idiot). I justified it by: 

1. I trust the guy 

2. It will help save me time 

3. He rents from me, I like this guy as a person- why would he do anything shady?? 

well- after about 3 weeks that one bit me in the behind- charges from Family Dollar and Lowes popped up that were not authorized. I immediately cancelled the card and had him return what he bought- which after pressing him for the receipts it was clear they were not job related charges. 

Had he been a contractor, I could have fired him, but since he is one of my tenants, I felt I needed to tread lightly. I wasn't willing to press charges or make a huge deal about it-  and decided this was my own stupid tax for even thinking a credit card was a good idea in the first place. ( I have to take some responsibility there on my end). 

Cringe-worthy mistake #2: By hiring him, he clearly saw that I needed additional help, which damaged my credibility as a landlord.

As landlords, we have to keep a distance. As soon as tenants feel too comfortable, they start to take advantage... which leads to... 

Cringe-worthy mistake #3: I gave him an exception in paying rent on-time this past month.. 

(insert throw pens, remote controls, your computer mouse at this forum post) 

If I haven't lost you from my absolute lack of common sense and lack of following my OWN Processes, read on as to why this was the nail in my coffin with this tenant.....

A little back story- he called me up at the beginning of the month with "the story". We all get them- heck, I get one from each new tenant at least once within the first 3 months they start renting from me. And I'm good at being firm. 

However, since he had helped me out with these renovation projects, I felt I owed him a favor. I told him I wasn't happy that he was going to be late, and that I would make an exception this once. I asked him when he could have rent paid and he said 01/17. 

Well- you guessed it- its 01/17- end of day, no rent. I reached out earlier today and you know what his response was? " I will get it to you later". He acted like I was the one bothering him!! (Landlord credibility completely annihilated). 

The lesson I learned here was to never ever ever ever hire a tenant to do any sort of work. And secondly, never ever ever waiver on rent collection processes. And never give a tenant/ project manager a credit card ( I pretty much added that in for myself- anyone reading this with any common sense already knows that) 

So the purpose of this post is two fold- One- I would love some advice on how I can get my credibility back with this tenant and avoid this every single month until his lease expires in June. And Second- if in the future it seems like a good idea to hire a tenant to do some work- please think twice. 

[Theresa Harris]

@Kimberly Kesterke  Your response to I'll get it to you later is to show up with a notice tomorrow followed by an eviction notice.