What would you do in this situation?

Question

So we had a tenant who accidentally (no idea how this actually happens) left their bathroom sink, which had a little blockage, running over night and caused flooding onto their floor and into the unit below. We immediately called a water mitigation co. who came out do dry things out but some damage was already caused in the form of ruined paint and drywall. We are still assessing the damage but our insurance deductible is $1k. Curious how others would handle this situation?

Do you make the renters pay for it since it was complete negligence? Put them on a payment plan to cover it? Eat the cost, file insurance claim and warn them that if something like that happens again they are out of there? The tenants have only been there a couple months, though up to this point seemed to be great tenants. The lease doesn't specifically call out this act but does has some clauses regarding damages caused by gross negligence.

Account Closed · Answer

If your lease is unclear, perhaps your state's Real Estate law can offer come clarification. The deductible "seems" fair, and a payment plan. The Black and White PM in me says it's not the owners fault. The vacancy fear part of my brain wouldn't want to overly burden a new tenant at a time like this. Best to just be a human being here, and talk it out with your tenant. Come to some agreement, that both parties can live with. What is the tenant saying in regards to damages?

Debbie C. · Answer

I would have the tenant pay for the repair. The only question would be how to charge them, all at once or on a payment schedule. That is up to you.

They were careless and caused the damage, they should take the responsibility to make it right, and if they are great tenants then they should want to do the right thing.

You did not mention if they have a renters insurance policy in place. We require our tenants to be covered and to name us as "additional insured". That will cover a number of things that can happen to your property that the policy will pay for because many tenants will not have the extra money.

Good Luck

Scott Lyons · Answer

Thanks everyone for the great feedback. @Debbie C., we did not require renters insurance but will going forward.

Account Closed - renters haven't really said much other than being very apologetic. Unfortunately when this happened we rushed to fix the issue so more damage didn't occur and we immediately called a company to come fix it while working with our insurance rather than asking the tenants if they have insurance and having it go thru theirs.

@Anthony Wick -  not sure how much it will cost as we are still fixing. Just happened over the weekend. But a good amount of damage to drywall that will likely have to be replaced.

Lessons learned all around.

Account Closed · Answer

@Scott Lyons I don't think you "rushed" incorrectly. Most insurance company's are appreciative of action to prevent further damage to the property and in turn a larger claim. It's not too late if they do have insurance. Get the property repaired, and then start working on restitution if any. Sounds like you're doing fine...best of luck.

Greg M. · Answer

And so many landlords still question why they should require a renter to have Renters insurance.

Assuming that you didn't require your tenant have Renters Insurance, you might as well file under your insurance and make the tenant pay the deductible. I suspect the dramatic increase in your insurance premiums and/or time spent finding a new insurance carrier at significantly higher rates after this one drops you will just be a cost you need to bear.

Anthony Wick · Answer

@Scott Lyons. The last thing I would do is simply eat the cost due to a tenants negligence. It doesn't matter that is was an accident. It's not your accident to pay for. You didn't say how much the final cost will be. I would first try and have the tenant file under their insurance. Then file under my insurance. And absolutely charge the tenant full out of pocket price. I would attempt to get them to pay for it all at once, then a payment plan if that is not possible. And do NOT let them take it out of their damage deposit, which should never be used while a tenant still lives there.

Matt Ziegler · Answer

We recently had a similar issue happen at one of our properties. We plan to update the leases to clarify that stopped up toilets/ drains are the responsibility of the tenants.

The restoration company was helpful in working with the insurance and repair folks as well.

It a pain and a mess, but will be  fixed with a lesson learned.

What would you do in this situation?

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